A Conservative MP who serves as parliamentary secretary to the Canadian Heritage Minister raised thousands of dollars in political contributions from people involved in a high-stakes campaign to win a new Toronto radio licence.
Paul Calandra, the MP for Oak Ridges-Markham, attended and received money at two private fundraising parties that included people connected to two of the bids under consideration by the CRTC, which reports to Canadian Heritage.
When a Globe and Mail reporter brought up the fundraising activities recently, Mr. Calandra said he did nothing wrong. He also said he will give back some of the money.
The fundraising episode shows that five years after the Conservatives banned corporate donations to political parties, a link remains between political fundraising and business interests. The Conservative Party recently warned riding associations that fundraisers should be "no-lobbying zones" and reminded ministers and parliamentary secretaries to avoid real or perceived conflicts.
More than 20 companies are competing to win a rare and highly coveted new spot on Toronto's FM dial at 88.1 FM.
The Canadian Radio-television and Telecommunications Commission held hearings this year but has not yet announced a winner.
In late March, one of the applicants, WorldBand Media Inc., owned by CEO Prabha Selvadurai, hired Hill and Knowlton to lobby Canadian Heritage, the CRTC and members of Parliament on its proposal for a new talk-radio station.
The Globe has learned that just over two weeks later, on April 10, a private fundraiser took place in the basement of a suburban Markham, Ont., home owned by Mr. Selvadurai's sister, Kirupalini Kirupakaran. Dr. Kirupakaran has pledged to the CRTC that she will invest up to $2-million in WorldBand Media should it win the competition. About $22,000 was raised at the event. Mr. Calandra also received a contribution at another basement fundraiser from the head of a second company competing for the prized spot on Toronto's radio dial.
The April 10 fundraiser was attended by Mr. Selvadurai, along with several members of his immediate family. Former Ontario Tory cabinet minister David Tsubouchi, who sits on WorldBand's board of advisers, attended, as did five others who have pledged to invest in the proposed radio station, which would be called Touch FM.
Some who attended the evening cocktail event estimate there were about 30 to 40 people in the room, including members of Mr. Calandra's constituency office and riding association team.
In an interview, Mr. Calandra said neither Mr. Selvadurai nor members of his immediate family made donations. That means most of those who did give likely made contributions at or near the $1,100 maximum allowable annual figure.
The contributions have not been disclosed publicly as they have not yet been filed with Elections Canada.
Mr. Calandra initially declined to say who hosted the fundraiser and claimed he had never received donations from anyone associated with Mr. Selvadurai's companies.
However, after going though the donations over several days to answer questions from The Globe, Mr. Calandra said that in fact five people listed with the CRTC as proposed WorldBand investors made donations worth a total of about $5,000 – and that those donations will be returned. He said the riding association will ask its auditor whether the host of the event has made an in-kind donation by offering her basement rent free.
"One person who had spread the word about the fundraiser did not understand the conflict that he might have been putting us or himself in by inviting these people," Mr. Calandra said. "It was one person who was responsible for these five potential conflicts, but it wasn't Prabha in any shape or form. He knew the rules and he was bang on."
The MP said it's routine for a riding association to initially accept donations and later reject them as they are reviewed prior to filing with Elections Canada. His campaign returned eight donations from the 2011 election campaign worth a total of $1,100. After the 2008 campaign, Mr. Calandra's association returned two donations worth a total of $350.
Heritage Minister James Moore was in Markham the day after the fundraiser to announce art funding projects with Mr. Calandra. The minister did not attend the fundraiser and both the minister and the MP say they've never discussed the fundraiser or the CRTC application.
The minister's office did not comment when asked whether the fundraiser raised any concerns.
In an interview, the CEO of WorldBand Media, Mr. Selvadurai, said he did not invite the investors to the fundraiser. He also said he was not aware they had made donations. He said the event was not related to his CRTC application, but he also said it's important to make MPs aware of his business.
"As a Toronto businessman, it is important for me to ensure these MPs know about my business and intention to grow my business in Toronto," he said in a prepared statement sent by e-mail after several phone conversations with The Globe.
Mr. Calandra said his riding association is also reviewing a contribution from Stan Antony from another fundraiser this year that was held in the basement of a home in Richmond Hill, Ont., on Feb. 22. Mr. Antony is leading a competing bid for 88.1 with the CRTC that would be called Stan FM.
The Conservative Party is clearly aware that parliamentary secretaries are at risk of running into political trouble through fundraising. The party's national council sent an e-mail to riding associations in June specifically warning against real or apparent conflicts.
"Since Ministers and Parliamentary Secretaries are in charge of specific portfolios in the government, they have special duties to be and appear to be free from any conflict of interest," states the note. "For this reason, people who make financial contributions to politicians and political parties must not receive or even appear to receive preferential access to politicians. In short, all fundraising events need to be no-lobbying zones."
The CRTC is an independent federal regulator that reports to Parliament through the Minister of Canadian Heritage, James Moore. However the limits to that independence were made clear last year when then-Industry minister Tony Clement called a CRTC ruling on Internet fees "simply wrong" and ordered the regulator to reconsider its ruling, which it did.
In June, the federal Conservatives appointed a new CRTC chair, Jean-Pierre Blais, replacing previous chairman Konrad von Finckenstein.
A WorldBand Media website says Touch FM "will drive high-quality, locally-sourced content to audiences underserved by current mainstream News/Information/Talk radio programming." The website says the station has "proposed partnerships" with Toronto Life, Sun Media and iPolitics.ca.
Because of the large number of voters in the riding, candidates running in Oak Ridges-Markham had the highest spending limit in the country during the 2011 federal election, at $134,351.