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Former Tory MP Rahim Jaffer, right, and his business partner Patrick Glemaud prepare to testify before a Commons committee on April 21, 2010.

FRED CHARTRAND/Fred Chartrand/The Canadian Press

Former Conservative MP and caucus chairman Rahim Jaffer conducted unregistered lobbying activities on behalf of his company inside the Harper government, in breach of the Lobbyists' Code of Conduct, according to watchdog Karen Shepherd.

In a report released on Monday, the Lobbying Commissioner criticized the actions of Mr. Jaffer and his business partner, Patrick Glémaud, who were at the heart of a major political controversy that also engulfed Mr. Jaffer's wife, former MP Helena Guergis.

"Although Mr. Glémaud and Mr. Jaffer were not successful in securing more than $178-million in government funding that they were seeking, their activities required registration," Ms. Shepherd writes. "This report shows that registration is required even if the desired outcome is not achieved."

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Mr. Jaffer and Mr. Glémaud will not face any penalties as a result, as the report pointed out that "breaches of the Code carry no fines or jail terms."

The RCMP investigated the matter, but determined that the file was not strong enough for prosecution.

"In a letter received on March 29, 2011, the RCMP advised me that they had closed their file due to the potential limitations for prosecution under the Lobbying Act," Ms. Shepherd wrote.

The Conservatives have shown little sympathy toward Mr. Jaffer since the start of the controversy. In a statement, the Prime Minister's Office emphasized the fact that Mr. Jaffer and Mr. Glémaud "did not secure any government funding."

"Our government put in place tough laws to ensure lobbying in Canada takes place above board and according to the rules. That is why we referred all non-reported meetings to the Lobbying Commissioner of Canada for her review," said PMO spokesman Andrew MacDougall.

But Stephen Harper's former chief of staff, lawyer and lobbying expert Guy Giorno, used his Twitter feed to state that the failure to obtain federal funding is not an excuse in this case. "Sorry, even ineffective lobbyists must register," Mr. Giorno said.

Ms. Shepherd concluded that Mr. Jaffer and Mr. Glémaud conducted lobbying activities on a number of occasions, such as the time in 2010 that they communicated with the office of then-environment minister Jim Prentice, seeking $600,000 in funding for a company called RLP Energy Inc.

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The report found that the communications "were not performed as an act of kindness, or on a voluntary basis."

Overall, the report said that Mr. Jaffer and Mr. Glémaud's company, GPG, submitted three proposals under the Green Infrastructure Fund worth a total of $178-million.

"Evidence obtained during the course of the investigation demonstrates that Mr. Glémaud and Mr. Jaffer communicated with federal public office holders in respect of the awarding of grants, contributions or other financial benefits," the report said.

In response to the report, Mr. Glémaud blamed the "often ambiguous provisions" of the Lobbying Act.

And Mr. Jaffer expressed his concern over the fact the Commissioner of Lobbying pursued her investigation even though the RCMP has decided not to lay any charges.

The NDP, meanwhile, blasted the fact that the legislation does not include any penalties for breaches to the Lobbyists' Code of Conduct.

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"We're not at all satisfied with the outcome of today's findings," Winnipeg MP Pat Martin said. His colleague, Alexandre Boulerice, added that the legislation should be amended to include penalties.

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