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A man makes his way into the Charbonneau Commission in Montreal on Sept. 3, 2013.

GRAHAM HUGHES/The Canadian Press

A whistle-blower from Quebec's FTQ-Construction, one of the province's biggest and richest unions, has told the Charbonneau corruption inquiry that senior Mob and Hells Angels bosses were woven into the fabric of the organization's top echelon.

Ken Pereira, a union executive from 2005 to 2009, testified Tuesday that he always knew top union officials, including executive director Jocelyn Dupuis, were tight with Hells Angels. But it was a meeting in late 2008 or early 2009 at a Hilton in the Montreal suburb of Laval that he says he realized Montreal's Mafia was really running the union.

Mr. Pereira, who had been complaining about Mr. Dupuis's lavish spending on booze and restaurant meals, was summoned to meet with reputed high-level mobster Raynald Desjardins, who explained he was there to settle "the issue with Dupuis."

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Mr. Desjardins also explained that construction boss Tony Accurso and former FTQ-Construction president Jean Lavallée were now in charge of the union's multibillion-dollar investment fund.

"I got scared," Mr. Pereira testified. "I understood what he wanted to say was that at that moment, I discovered that Jocelyn Dupuis, who I thought was the boss, wasn't the boss. Raynald Desjardins was the boss."

Mr. Desjardins, a long-time close associate of the godfather of the Montreal Mafia, Vito Rizzuto, had "great influence" over Mr. Dupuis, Mr. Pereira testified. (Mr. Desjardins is awaiting a first-degree murder trial for his alleged role in the death of mobster Salvatore Montagna.)

Mr. Pereira said it was Mr. Accurso's Laval restaurant, Onyx, that the union's leadership used as their "bunker" to plot strategy.

In earlier testimony, Mr. Pereira described a cosy relationship between Mr. Dupuis and Normand (Caspar) Ouimet, a powerful member of the Hells Angels. Top union officials and gang members regularly frequented the same restaurants, golf clubs and strip bars.

When a biker strip club named the 10-35 burned down in Chambly, a Montreal suburb, the union bosses helped rebuild, even investing $1-million into it from the FTQ-Construction investment fund.

"Everyone at the FTQ knew Jocelyn Dupuis was part of or hanging around with the gang. His family was the FTQ, but he had another," Mr. Pereira said. "He didn't even bother pretending to hide."

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In 2008, Mr. Pereira said he began looking into Mr. Dupuis's expenses. He found the union boss could spend up to $4,000 a day on meals, and often made cash claims that added up to $70,000 in one six-month period. "Anybody could see Dupuis was living beyond his means," Mr. Pereira said.

Executives would photocopy each other's receipts to submit them for reimbursement, Mr. Pereira said.

Mr. Pereira said he went to Michel Arsenault, president of the FTQ, to complain about the expenses. The union head asked him not to go to the media while the problem was sorted out.

Instead, the union executive demanded Mr. Pereira return the receipts he had examined, or be expelled from the union. He said another union executive, Eddy Brandone, offered him the keys to his Mercedes in return for his silence. Later, he testified Mr. Brandone warned him "nobody could control the Mafia" if they caught wind of his informal auditing of union expenses.

Mr. Pereira gave the union executives copies of their receipts and sent originals to the Sûreté du Québec. Mr. Dupuis now awaits trial on fraud charges. He is accused of using his position to help construction bosses inflate profits on government contracts.

Mr. Accurso is also facing fraud charges on several cases involving land deals and alleged bribery in the Montreal region.

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Like several witnesses facing trial, Mr. Dupuis sent a lawyer to try to argue for a publication ban on the evidence. Justice France Charbonneau shot down the request, saying a trial is months away and the details of the inquiry testimony will have long faded.

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