Government-owned Canada Post has placed its money and weight behind a Liberal fundraiser's aggressive and controversial cross-Canada expansion of his Montreal-based messenger-service firm.
Messenger-service companies in several cities have protested to the federal government that the Crown corporation is using its massive resources and influence to unfairly back the expansion of Montreal-based messenger Intelcom.
The Globe and Mail has discovered that Intelcom and Canada Post officials have common ties to the Quebec wing of the federal Liberal Party.
Critics contend that the connections raise questions about why a Crown corporation chose Intelcom from the ranks of hundreds of couriers for a potentially lucrative alliance.
Canada Post spent $1-million in 2001 to buy 50 per cent of Intelcom Courier Inc., a major Liberal donor then controlled by Daniel Hudon, a fundraiser and former member of the finance committee for the Quebec wing of the federal Liberal Party. Mr. Hudon became active in the Liberals' Quebec wing when his friend, Justice Minister Martin Cauchon, was president from 1993 to 1995, Liberal insiders say. Canada Post president André Ouellet was then foreign affairs minister and Jean Chrétien's political minister for Quebec, responsible for the Quebec wing.
"It absolutely bears questioning as to why this particular company was chosen," said Progressive Conservative MP Peter MacKay.
"Given those connections, it certainly raises questions of fairness and the appropriateness of this entire enterprise, given that two individuals stand to make sizable gains because of the long-standing weight that Canada Post would have in this area."
Since Canada Post purchased half of Intelcom from Mr. Hudon and his partner Sylvain Hurtubise, senior officials from Canada Post have visited some of the postal service's suppliers to push them to switch their messenger business to Intelcom.
The officials include the postal service's chief of purchasing, Gilles Courville, now on secondment to Intelcom as a salesman, and Roger Legaré, until recently senior adviser to Mr. Ouellet, Canada Post's president.
Mr. Legaré was also executive director of the Liberal Party's Quebec wing in the mid-1990s under Mr. Ouellet and Mr. Cauchon. (He left Canada Post in September when Human Resources Minister Jane Stewart appointed him to the Employment Insurance Commission.)
Dozens of rush courier companies have formed the Alliance to Stop Canada Post, arguing that a government-owned monopoly should not expand to compete against existing small businesses. They also charge that the postal service is squeezing its major suppliers to switch to Intelcom, helping the company grow -- as well as the stakes owned by Mr. Hudon and Mr. Hurtubise.
"This is just a get-rich formula," said Jack Hansen, a co-owner of QA courier, which operates in Toronto and Montreal. "What is the process that the Canadian government went through to make such a lucrative opportunity? Why weren't all courier companies notified of this?"
A spokesman for Canada Post, Francois Legault, said political ties had nothing to do with the acquisition of half of Intelcom. It was chosen because it was one of the 10 largest domestic messenger companies in Canada, and "one of the best," he said.
He said there was no public competition, but would not say whether any other company was considered.
Mr. Hudon is a friend of Mr. Cauchon, now Mr. Chrétien's Quebec political minister. From 1993 to 1995, Mr. Cauchon was president of the Quebec wing, Mr. Legaré the senior staffer, and Mr. Ouellet the Quebec political minister.
Mr. Hudon became a member of the finance committee of the Quebec wing, and organized regional fundraising cocktails on the south shore of Montreal, where he lives, according to well-placed Liberals. Later, Mr. Hudon was friendly with Alfonso Gagliano, Quebec political minister from 1997 to 2002, who was also responsible for Canada Post as public works minister.
In 1998, Intelcom donated $22,901 to the Liberal Party, placing the firm on the list of the party's top 50 corporate donors, alongside Canada's biggest corporations.
It also donated $5,732 in 1999, when Mr. Hudon donated another $2,000. In recent years, it also donated smaller sums to three MPs: $934 to Mr. Cauchon, $460 to Laval-East MP Carole-Marie Allard, and $815 to Mr. Gagliano.
An aide to Mr. Cauchon, Luce Asselin, said Mr. Cauchon had no involvement in Canada Post's decision to buy into Intelcom.
In addition to Canada Post's purchase of 50 per cent of Intelcom, the courier company was a minor partner when Canada Post bought warehousing and "logistics" firm Progistix-Solutions Inc. from BCE Inc. for $36-million. Intelcom acquired 2.63 per cent of the shares.
Intelcom took over several other rush couriers in Quebec, Calgary and the Toronto area, according to corporate-registry documents. Mr. Legault refused to say whether Canada Post financed the acquisitions.
Canada Post has denied the charge that it has pushed suppliers to switch to Intelcom.
But employees of two supplier firms, who spoke on condition of anonymity, said Canada Post officials accompanied Intelcom sales representatives to meetings and warned there could be repercussions if they did not switch to Intelcom.
"Because we are a big supplier, they said we have no choice, we have to go with Intelcom," said one employee at a major firm.
Mr. Legaré and Mr. Courville confirmed they attended sales meetings, but not to put undue pressure on suppliers.
Mr. Legaré confirmed that he went with Intelcom on sales calls when he worked for Canada Post, but declined to comment further. Neither Mr. Hudon nor Mr. Hurtubise returned telephone calls requesting comment.
Mr. Courville, who said he is still a Canada Post employee but now assigned to work for Intelcom and temporarily paid by the rush courier, denied linking Canada Post supply contracts to Intelcom sales, saying he has no power to cut off suppliers.
He said he visited not only Canada Post suppliers, but other companies as well.
He said there is no pressure implied by Canada Post's purchasing manager or an adviser making sales calls. "It's a question of judgment," he said.