Toronto Mayor Rob Ford has been accused of breaking election-finance laws.Fred Lum/The Globe and Mail
Mayor Rob Ford has filed "complete and transparent" documents that invalidate multiple requests for a compliance audit, his lawyer contends.
Thomas Barlow submitted a detailed response to requests filed in recent weeks for a compliance audit, saying Mr. Ford's campaign filings conform with both the Municipal Elections Act and City of Toronto bylaws.
City council's compliance-audit committee is meeting Friday to decide whether to retain an external auditor to review the campaign's books.
At issue is whether Mr. Ford breached election rules by turning to his family holding company, of which he is a shareholder, to advance cash to cover election expenses before his fundraising operation kicked into gear.
"That is a question that the compliance committee is going to have to answer," York University political scientist Robert MacDermid said.
It wasn't until this past March that Mr. Ford's campaign organization repaid $77,722.31 to his family's holding company, which had procured election-related goods and services early in the 2010 mayoral race, according to documents filed late Wednesday afternoon with the city clerk's office in response to three requests for a compliance audit.
The file describes Doug Ford Holdings (DFH) - the federally incorporated entity that owns the Ford family's printing company, Deco Labels and Tags - as just one of several "vendors" to the campaign that had to wait to be repaid until the mayor cleared his election-related debts earlier this year. The documents further note "there was no interest paid to DFH since DFH was a vendor, and not a lender, to the Campaign."
The residents who filed compliance-audit requests allege that the payments constitute a de facto loan. Election rules say campaigns must pay election expenses from campaign accounts opened at recognized financial institutions.
But Mr. Barlow's submission strenuously disputes that characterization. "DFH delivered goods and services through its subsidiary, Deco Labels and Tags, or subcontracted for goods and services from other vendors. In every instance, all goods and services rendered by DFH have been paid from the Campaign's account."
He also dismisses suggestions that Mr. Ford improperly exceeded his statutory campaign spending limits or accepted a $1,596.73 corporate donation from a caterer, noting that the firm is a sole proprietorship.
The other applicants also filed more detailed documents on Wednesday. Mr. Barlow, who was preparing Mr. Ford's response over the past week, has not yet had an opportunity to address the latest issues being raised.
Max Reed and Adam Chaleff-Freudenthaler, who filed a 17-page submission last Wednesday, filed an amended version that further alleges that two of Mr. Ford's campaign events - the complimentary wine-and-cheese party held at the Toronto Congress Centre on March 26, and a second function at the Grand Baccus banquet hall on June 5 - included only "incidental fundraising." They contend that the combined cost of almost $62,700 was "miscategorized" as a fundraising expense. Mr. Barlow dismisses previous allegations that the campaign overspent.
At the meeting, Mr. Reed and Mr. Chaleff-Freudenthaler will also be urging the committee to ask an auditor to ensure that the campaign paid fair market value for the $211,624.32 worth of goods and services purchased from the Ford family company, Deco Labels and Tags.
According to their filing, "if the Rob Ford Campaign did receive a discounted rate from Deco Labels and Tags, the difference between the price paid and the fair market value of the goods and services" amounts to a corporate contribution, which is prohibited under City of Toronto election bylaws.
Ted Ho, whose initial request was based on a Globe and Mail investigation, retained civil-rights lawyer Peter Rosenthal to prepare a more detailed eight-page submission, also filed Wednesday.
Mr. Rosenthal cites several recent judicial decisions - including one focused on a nasty battle over Vaughan Mayor Linda Jackson's campaign finances - indicating that council is obliged to order a compliance audit if there are "reasonable grounds" to believe election rules have been compromised. "There is little discretion in deciding whether to order a compliance audit once reasonable grounds are found to exist," Mr. Ho's submission says.
Mr. Chaleff-Freudenthaler and Mr. Reed are also invoking case law on compliance audits, citing in their submission judicial decisions about cases in which the scope of the audit far exceeded the original compliant.
Special to The Globe and Mail