Executives at a Quebec labour investment fund seeded with millions in public money suspected years ago that the fund paid for half of the construction cost of a lavish yacht named The Touch which was used to woo a long list of Quebec politicians, labour leaders and businessmen accused of corruption.
Wiretaps introduced as evidence on Wednesday captured Quebec Federation of Labour president Michel Arsenault being informed by QFL investment fund CEO Yvon Boluc in 2009 that a that a company half-owned by the fund was billed for millions in construction material.
"We paid for 50 per cent of the boat, damn it," Mr. Bolduc said in the conversation. Mr. Arsenault replied that it was news to him.
The yacht was owned by Tony Accurso, the onetime construction boss accused of a raft of corruption-related charges who has been a central figure at the Charbonneau inquiry examining corruption in the province's construction industry.
Several wiretap recordings of conversations between Mr. Arsenault and Mr. Accurso revealed how close the two men were. They planned and took vacations together, including on The Touch, on Mr. Accurso's dime, while Mr. Arsenault was quick to pick up a phone to lobby Jean Charest, then premier, to boost Mr. Accurso's interests.
And Mr. Accurso's ties to the labour fund went way back: His early business ventures received fund money, but at least four of Mr. Arsenault's predecessors also went on the Touch, the commission heard.
However, the boat payments were too much for Mr. Arsenault, who, in the wiretap, expressed disbelief, and maintained in his testimony Tuesday that he "still doesn't believe" the investment fund paid for the boat construction, but that it wasn't his problem because it happened before his time.
(In 2010, companies Mr. Accurso controlled, including some once partly owned by the fund, pleaded guilty to $1.7-million in tax evasion for false billing related to the Touch construction.)
Commission head Justice France Charbonneau suggested Mr. Arsenault turned a blind eye to the yacht billing because of his friendship with Mr. Accurso. Mr. Arnsenault denied it.
But Mr. Arsenault looked after Mr. Accurso in other ways. In one wiretap, Mr. Accurso complained bitterly that an engineering contract for a major highway construction contract was going to the "Chinese." (It later turned out the contract went to a company from the Philippines.) Days later, Mr. Arsenault was on the phone to Mr. Charest to demand the work stay in Quebec hands.
Mr. Arsenault maintained the calls were to lobby on behalf of Quebec workers and engineers, not Mr. Accurso. However, he quickly called Mr. Accurso after the phone call to reassure him that Mr. Charest "had turned white as a ghost" when he heard the complaint. He also said Premier Pauline Marois, then an opposition leader, was on the same page.