SNC-Lavalin Group Inc.’s CEO Neil Bruce wrote to Prime Minister Justin Trudeau in mid-October, 2018, lamenting the fact that his company, which he called a crown jewel of Canadian industry, "had not been treated very well” in the weeks after it was denied the opportunity to negotiate a settlement of corruption and fraud charges.
The Oct. 15 letter from Mr. Bruce to Mr. Trudeau is dated the same day that Michael Wernick, the Clerk of the Privy Council, the bureaucratic agency that serves the government, talked by phone with SNC-Lavalin chair Kevin Lynch, who was clerk of the privy council from 2006 to 2009. Mr. Wernick, who revealed this conversation at a Commons justice committee hearing this week, said Mr. Lynch voiced frustration about the government’s refusal to negotiate a deferred prosecution agreement (DPA).
Mr. Bruce sought a meeting with Mr. Trudeau “at your earliest convenience" on the matter, saying that after his company disclosed the news that it would not have a chance to avoid prosecution, the price of its stock dropped significantly. He said the company “experienced one of the darkest days in SNC-Lavalin’s history.”
This letter to Mr. Trudeau was submitted recently to the Commons justice committee, which called hearings into the matter after The Globe and Mail reported on Feb. 7 that officials in the Prime Minister’s Office put pressure on Jody Wilson-Raybould when she was justice minister and attorney-general to order a settlement with the Montreal construction and engineering giant.
Mr. Bruce did not obtain the meeting he sought with Mr. Trudeau. The Prime Minister replied to him in a Dec. 6 letter saying that “because the issues you have raised pertain to matters before the courts,” he would instead bring the chief executive’s letter to the attention of Ms. Wilson-Raybould. He wrote the same day to apprise Ms. Wilson-Raybould of the letter.
On Oct. 19, SNC-Lavalin applied for a judicial review of the prosecution service’s decision.
Ms. Wilson-Raybould told the committee last week she faced “consistent and sustained” political pressure, including “veiled threats,” from Mr. Trudeau and top officials to shelve the SNC-Lavalin prosecution. The independent Director of Public Prosecutions, Kathleen Roussel, had informed SNC-Lavalin early last September she had turned down its request for a negotiated settlement known as a deferred prosecution agreement (DPA) to avoid a trial. The attorney-general has the authority to accept or override this decision.
Ms. Wilson-Raybould was demoted to veterans affairs in a January cabinet shuffle, which she said she believes stemmed from her opposition to negotiating a deal with SNC-Lavalin.
The controversy has cost Mr. Trudeau three high-profile colleagues: Gerald Butts resigned as his principal secretary, and Ms. Wilson-Raybould and former Treasury Board president Jane Philpott have quit cabinet. Ms. Philpott, who had no role on SNC-Lavalin, stepped down this week, citing “serious concerns” about the political pressure exerted on Ms. Wilson-Raybould.
The phone conversation between Mr. Wernick and Mr. Lynch was not in the federal lobbyists’ registry. The Office of the Commissioner of Lobbying said on Thursday it is “currently assessing the information put forward by Mr. Wernick.”
In his letter, Mr. Bruce said Ottawa’s refusal to enter negotiations was “disappointing news,” noting that the company’s counsel, former Supreme Court justice Frank Iacobucci, was not “afforded the courtesy of a meeting or even a call with the [director of public prosecutions] after several requests were made" to let him explain the rationale behind SNC-Lavalin’s request for a settlement.
SNC-Lavalin faces one charge of corruption under the Corruption of Foreign Public Officials Act and one charge of fraud under the Criminal Code. It is alleged that SNC paid millions of dollars in bribes to public officials in Libya between 2001 and 2011 to secure government contracts. The engineering company says executives who were responsible for the wrongdoing have left the company, and it has reformed its ethics and compliance rules.
If convicted, SNC-Lavalin could be banned from bidding on federal contracts for up to 10 years.
A deferred prosecution agreement would set aside the case without a trial. In such deals, which are used in the United States and Britain, a company accepts responsibility for the wrongdoing and pays a financial penalty, relinquishes benefits gained from the wrongdoing and puts in place compliance measures.
Mr. Bruce said not only SNC-Lavalin was hurt, but also its shareholders, noting two pension plans, Caisse de dépot et placement du Québec and the Canada Pension Plan, and other top financial institutions hold the company’s shares. “The [recent] erosion in stock price … impacted many innocent Canadians who are saving for the future,” the CEO wrote.
“Surely this is not a fair or just outcome for Canadian savers," he added.
On Thursday, the Prime Minister used an early morning news conference in Ottawa on Thursday to speak at length about the political crisis.
Mr. Trudeau says he did not realize there was an “erosion of trust” between his office and Ms. Wilson-Raybould during the fall of 2018, and acknowledged he should have done so.
He offered no apologies or contrition. He acknowledged no wrongdoing.
“There are conversations that were experienced differently. I regret, and we will ensure that we have measures to improve the functioning of my office and the way in which we engage with ministers and members of the caucus,” Mr. Trudeau told reporters.
Ms. Wilson-Raybould told the committee that senior government officials between September and December last year repeatedly returned to the question even after she told them her mind was made up and that she supported the director’s decision. She listed 10 conversations or meetings that involved 11 officials.
Mr. Trudeau acknowledged on Thursday morning that he should have paid more attention to growing friction between his staff and Ms. Wilson-Raybould.
“What has become clear through the various testimonies is that, over the past months, there was an erosion of trust between my office and specifically my former principal secretary and the former minister of justice and the attorney-general,” Mr. Trudeau told reporters at the National Press Theatre.
“I was not aware of that erosion of trust. As Prime Minister, and leader of the federal ministry, I should have been.”
He sought to reassure Canadians nothing untoward happened. “There was no breakdown of our systems, of our rule of law, of the integrity of our institutions.”
On Thursday, the Public Prosecution Service of Canada (PPSC) joined the national debate, saying on Twitter its staff must be free to carry out their duties without "political influence.” It said: “prosecutorial independence is key to our mandate. Our prosecutors must be objective, independent and dispassionate, as well as free from improper influence – including political influence.”
A spokeswoman for the prosecution service said the tweet was not approved by Justice Minister and Attorney-General David Lametti, but was part of a preplanned suite of tweets designed to help inaugurate its new account on the social media platform. “The tweet was part of a package of tweets prepared for the launch of the PPSC Twitter account, and circulated for approval to PPSC senior management and the DPP,” Nathalie Houle said.
Prime Minister Justin Trudeau addressed the SNC-Lavalin affair Thursday, saying he didn’t realize there was an “erosion of trust” between his office and former attorney-general Jody Wilson-Raybould, and acknowledged he should have realized this was taking place.
Conservative Leader Andrew Scheer called it “very troubling that Justin Trudeau’s actions and attempts at interference have made such a statement necessary.”
“Justin Trudeau would have Canadians to believe that all of this took place simply because different people had different experiences of events. But there is something that Justin Trudeau simply does not understand. The truth cannot be experienced differently. There is such a thing as right and wrong and real leaders know the difference between them.”
Mr. Trudeau said he will seek outside advice on whether to separate the posts of attorney-general and justice minister – a question that has arisen during the debate on the matter. His announcement comes one day after Mr. Wernick, Canada’s top bureaucrat, suggested MPs on the justice committee study the idea, while cautioning such a change could have "consequences, intended and unintended, for decades to come -- and should not be rushed.”
Asked whether he was making an apology in his Thursday address to media, Mr. Trudeau indicated he was not. He said he will not apologize for defending jobs at SNC-Lavalin. Mr. Trudeau noted he would be apologizing to the Inuit later in Iqaluit for how Ottawa handled tuberculosis outbreaks in the North between the 1940s and 1960s.
“I will be making an Inuit apology this afternoon. But in regards to standing up for jobs, and defending the integrity of our rule of law, I continue to say there was no inappropriate pressure." The apology was later postponed because of bad weather in Iqaluit.
He said he hoped to learn from what has happened regarding SNC-Lavalin. “I can tell you without a doubt I have taken and will continue to take many lessons from these recent days and weeks.”
Mr. Scheer said on Thursday that Mr. Trudeau has not dispelled Ms. Wilson-Raybould’s account of events.
“It’s now beyond dispute that he and his office bullied and threatened Ms. Wilson-Raybould in an attempt to get her to let SNC-Lavalin off the hook,” the Conservative Leader said. “When she resisted these attempts, he fired her.”
Mr. Scheer noted that the Prime Minister’s Office and Privy Council Office – the bureaucratic agency that serves the leadership of government – have not produced studies to back up their assertion that thousands of jobs would be lost if the company were convicted.
In his Thursday news conference, Mr. Trudeau offered a version of his Sept. 17 meeting with Ms. Wilson-Raybould that differs from her testimony to the Commons justice committee last week.
The B.C. MP told the committee she cautioned Mr. Trudeau on Sept. 17 that she had already decided to allow Ms. Roussel to proceed with the prosecution of SNC-Lavalin. She said she told him: “I had done my due diligence and had made up my mind on SNC and that I was not going to interfere with the decision of the director."
After Mr. Trudeau reminded her that day he was an MP from Montreal, where SNC-Lavalin is based, Ms. Wilson-Raybould testified that she asked him to stand down.
“Are you politically interfering with my role, my decision as the attorney-general? I would strongly advise against it,” she recalled telling Mr. Trudeau.
On Thursday, the Prime Minister was repeatedly asked why the PMO and the Privy Council Office continued to press Ms. Wilson-Raybould after Sept. 17.
He told reporters he still did not realize Ms. Wilson-Raybould was unwilling to consider the matter further.
“My staff and I believed that the former minister of justice and attorney-general was open to considering other aspects of the public interest,” he told reporters. “However, I now understand that she saw it differently.”
The Prime Minister also said he believed Ms. Wilson-Raybould promised on Sept. 17 to keep an open mind.
“I asked her if she could revisit that decision – if she was open to considering, to looking at it, once again," he said. "And she said that she would.”
Ms. Wilson-Raybould directly addressed this exchange during her Feb. 27 testimony, saying although she agreed to further discuss the matter with Mr. Wernick and her deputy justice minister, she did not leave open the possibility of reversing her decision.
“I agreed to and undertook to the Prime Minister that I would have a further conversation with my deputy and the clerk – but that these conversations would not change my mind," she told the committee.
Asked again why his office and the Privy Council Office kept pressing her, Mr. Trudeau said officials were keen to protect jobs.
“SNC-Lavalin is a company that employs 9,000 Canadians across this country. They create many thousand spin-off jobs in peripheral industries,” he said, describing the company as one of Canada’s major employers. “They are also a company facing serious criminal charges … These are the types of situations that make governing a challenge.”
When asked whether he had misled Canadians when he characterized the original Feb. 7 Globe story as reporting false allegations, Mr. Trudeau said: “There was never any inappropriate pressure. There were many conversations on a delicate matter, but there was never any inappropriate pressure.”
Mr. Trudeau repeated an early defence of his conduct, saying he is disappointed Ms. Wilson-Raybould did not alert him she was concerned about what was happening.
“One of the things central to my leadership is fostering an environment where my ministers, caucus and staff feel comfortable coming to me when they have concerns. Indeed, I expect them to do so,” he said.
“In Ms. Wilson-Raybould’s case, she did not come to me and I wish she had."
With a report from The Canadian Press