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Police probe suspected frauds at city hall Add to ...

The Sûreté du Québec will investigate questionable transactions in Montreal after the city's auditor-general raised suspicions of fraud, kickbacks and influence peddling involving private companies and city officials.

The Parti Québécois called the incidents in the auditor-general's report the tip of the iceberg, saying that questionable practices also exist at the provincial level.

City auditor Michel Doyon said he investigated as far as he could the possible improprieties in the sale of city property for far less than market value. The rest is up to the police, he said.

In one transaction, the city's housing and development corporation bought a property for $773,000 and sold it for $1 to a company owned by Tony Accurso, owner of a construction company who has received numerous contracts from the city.

A few of Mr. Accurso's companies were recently raided as part of a Revenue Canada tax fraud investigation. Mr. Accurso was also involved in a deal under investigation by the city auditor for a controversial water-meter contract worth $335-million that Mayor Gérald Tremblay suspended after allegations of influence peddling and kickbacks.

Other deals highlighted in the report included one in which the city's housing development agency sold a building at less than market value and without public tenders to a numbered company whose owners include Montreal entrepreneurs Vincenzo Chiara, Joey Saputo and Giuseppe Borsellino.

As part of the city auditor's investigation, the private firm Deloitte&Touche was hired to investigate other land transactions. In its report released along with the auditor's report yesterday, the firm raises questions about the housing agency and its former director-general, Martial Fillion, a former provincial Liberal government adviser, who was suspended over a land deal involving the Montreal construction firm Frank Catania and Associates.

Municipal Affairs Minister Nathalie Normandeau said allegations of corruption at the municipal level are a source of serious concern. "I read the [auditor's]report. I find it disturbing, worrying and it is very important that we shed all the light on this," she said yesterday.

The Official Opposition said the province should set an example by creating a climate of trust and transparency rather than an environment that encourages conflict of interest. PQ House Leader Stéphane Bédard noted that Premier Jean Charest changed disclosure rules to allow ministers and their spouses to own companies that receive government contracts.

"What they are doing is allowing conflict of interest and defining how it can be done. I am completely dumbfounded that a company owned by a minister can be allowed to do business with the government," Mr. Bédard said.

The PQ also criticized the Liberal government over the return to the private sector of former health and social services minister Philippe Couillard, who left politics last year. The province's lobbying commissioner has reported that Mr. Couillard negotiated his own hiring conditions, including salary and benefits, with a private health care firm while he was still a member of the Charest government.

The lobbying commissioner's report said Mr. Couillard remained minister for seven weeks after negotiating his a contract to join Persistance Capital partners, which run private health-care clinics. Mr. Charest rejected the suggestion that this was an appearance of conflict of interest.

PQ members cited numerous examples that they said show ministers ignoring conflict of interest rules, including the fact that Mr. Charest and his cabinet ministers are several months late in disclosing their assets as required by law.

The Premier said he will not disclose in his statement the $75,000 a year he receives from the Quebec Liberal party. "There's no conflict of interest in that," Mr. Charest said.

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