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Politics SNC-Lavalin, Jody Wilson-Raybould and Trudeau’s PMO: The story so far

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  • There is enough evidence to bring SNC-Lavalin’s bribery and fraud case to trial, a Quebec court ruled Wednesday, months after the Trudeau government was rocked by controversy about whether the Prime Minister improperly pressed his attorney-general to settle the engineering firm’s case out of court. SNC had tried to convince a Quebec judge that the case didn’t merit going to trial.
  • Jody Wilson-Raybould and Jane Philpott, the former cabinet ministers expelled from the Liberal caucus over the SNC affair, said Monday that they would run as independents in the 2019 election. The announcements came within 20 minutes of each other in their ridings of Vancouver-Granville and Markham-Stoufville, respectively.
  • Ms. Wilson-Raybould’s relationship with the Liberals soured earlier this year after she alleged that, when she was justice minister in 2018, Prime Minister Justin Trudeau and his staff inappropriate pressed her to intervene with federal prosecutors and get them to reconsider a deferred prosecution agreement with SNC. Mr. Trudeau could have avoided the controversy if he accepted responsibility for the SNC file and apologized in February, Ms. Wilson-Raybould told The Globe and Mail last month.


SNC-Lavalin and Libya: A primer

SNC-Lavalin's Montreal headquarters.

Paul Chiasson/The Canadian Press

What is SNC-Lavalin? Based in Montreal, SNC-Lavalin is one of the world’s largest engineering firms, active in more than 160 countries. In Canada, where it employs about 9,000 people, it’s responsible for things like Quebec’s James Bay hydroelectric project and the Canada Line transit system in Vancouver. The Canadian government has invested heavily to help the company succeed over the years: From 2002 to 2018, the company got at least $2-billion in loans from Export Development Canada, making it one of the biggest beneficiaries from the federal export agency, according to data obtained by The Globe. But beyond Canada’s borders, some of SNC’s projects, and the methods allegedly used to obtain them, have gotten it into trouble: Allegations of bribery in Bangladesh got the company barred from World Bank-financed projects in 2013, and this year, a former SNC CEO pleaded guilty to breach of trust in the corruption scandal surrounding a Montreal hospital project.

Why does it matter so much? SNC is perceived to be a major breadwinner for Canada’s (and particularly Quebec’s) economy, but in terms of job numbers, the picture is more complicated. The company has fewer than half as many Canadian jobs now than it did in 2012, and there are four times as many employees outside Canada than inside. Meanwhile, its legal troubles, leadership changes and political hurdles to its business in Saudi Arabia have cost it billions in revenue and left it potentially vulnerable to foreign takeover. SNC is one of 10 companies the Quebec government has deemed strategically important to the province, and Premier François Legault has said he wants to prevent its headquarters from leaving Quebec. That makes the firm politically important to Prime Minister Justin Trudeau too: His Liberals’ re-election hopes in 2019 will hinge on Quebeckers’ support, and any threat to one of Quebec’s major employers could have dire consequences for his government.

SNC-Lavalin’s employees by area

Britain:

10,000

Quebec: 3,400

Ontario: 3,000

B.C.: 1,000

Rest of

Canada:

1,600

Canada

Britain

Rest of world

Rest of

world:

33,435

Note: SNC has provided estimates of its Canadian work

force. The rest of world figure comes from a subtraction

of the Canadian and British numbers from an overall

figure in the company’s 2018 annual report.

MATT LUNDY, THE GLOBE AND MAIL, SOURCE: SNC-LAVALIN

SNC-Lavalin’s employees by area

Britain:

10,000

Quebec: 3,400

Ontario: 3,000

B.C.: 1,000

Rest of Canada:

1,600

Canada

Rest of

world:

33,435

Britain

Rest of world

Note: SNC has provided estimates of its Canadian work force. The rest

of world figure comes from a subtraction of the Canadian and British

numbers from an overall figure in the company’s 2018 annual report.

MATT LUNDY, THE GLOBE AND MAIL, SOURCE: SNC-LAVALIN

SNC-Lavalin’s employees by area

Britain:

10,000

Quebec: 3,400

Ontario: 3,000

British Columbia: 1,000

Rest of Canada:

1,600

Rest of world:

33,435

Canada

Britain

Rest of world

Note: SNC has provided estimates of its Canadian work force. The rest of world figure comes from a

subtraction of the Canadian and British numbers from an overall figure in the company’s 2018 annual report.

MATT LUNDY, THE GLOBE AND MAIL, SOURCE: SNC-LAVALIN

What did it do in Libya? During the rule of the late dictator Moammar Gadhafi, SNC was involved in major public-work projects in the North African country, including a prison, an irrigation system and a new airport. In 2011, Swiss authorities and the RCMP began investigating claims that SNC had been bribing Libyan officials to get access to construction contracts. A former SNC executive vice-president, Riadh Ben Aissa, pleaded guilty in Switzerland to bribery and money-laundering in connection with SNC’s Libyan projects, which he admitted involved bribes to Mr. Gadhafi’s son, Saadi. SNC has admitted there was wrongdoing in Libya, but blames it on rogue employees who have since left the company, and says it has cleaned up its internal practices since then.

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Who is prosecuting the company? Federal prosecutors charged SNC in 2015 with attempted bribery and fraud over its activities in Libya from 2001 to 2011. If convicted, SNC would be barred from federal government contracts for 10 years. SNC tried to strike a deal with the prosecutors, what’s called a “deferred prosecution agreement.” DPAs – an established practice in the United States and Britain, but introduced to Canada only last year through new corporate-crime legislation – let companies admit wrongdoing, pay compensation and, in exchange, avoid trials that might be more costly or damaging to their reputations. On Oct. 10, 2018, the Public Prosecution Service of Canada announced that there would be no such deal, though The Globe later learned through court documents that SNC was informed of that decision on Sept. 4.

More reading on SNC-Lavalin

Interview with SNC-Lavalin CEO Neil Bruce: ‘We want to put this behind us'

In depth: How much does SNC-Lavalin actually matter to the economy?

Explainer: What are deferred prosecution agreements?

From the archives: The inside story of SNC-Lavalin’s Gadhafi disaster

What happened to Jody Wilson-Raybould?

Feb. 27, 2019: Jody Wilson-Raybould prepares to testify before the House of Commons justice committee about the SNC-Lavalin affair.

Blair Gable/The Globe and Mail

Jody Wilson-Raybould was the federal justice minister for three years, the first Indigenous woman to hold that post. In January, 2019, Mr. Trudeau reassigned her to Veterans Affairs in a cabinet shuffle, giving the justice portfolio to David Lametti. She didn’t last long in the new job, quitting from cabinet on Feb. 12, though she continued to serve as MP for Vancouver-Granville. Then, as the SNC affair dragged on, the Liberals booted her and former cabinet colleague Jane Philpott (more on her below) from caucus on April 2. Ms. Wilson-Raybould announced on May 27 that she’d run as an independent in October’s election.

In October, 2018, Ms. Wilson-Raybould had faced a crucial choice about the SNC case when the company lost its bid to have a deferred prosecution agreement. The Globe and Mail, citing sources familiar with the matter, reported on Feb. 7 that she had come under pressure from the Prime Minister’s Office to intervene and make the Public Prosecution Service of Canada reconsider a deal, but she refused. The Prime Minister and Privy Council Office chief Michael Wernick later denied that anything improper had happened (more on that below), but Ms. Wilson-Raybould was unable to give her version of events because of solicitor-client privilege. Finally, Mr. Trudeau gave a cabinet order allowing her to speak about her tenure as justice minister, though not events after that, or conversations between her and the PPSC chief. That cleared the way for a dramatic hearing of the House justice committee on Feb. 27, where Ms. Wilson-Raybould alleged, among other things, that:

  • She faced four months of “consistent and sustained” pressure from the PMO, PCO and Finance Minister’s office to “politically interfere” in the SNC case, despite her insistence that overruling the prosecutors for political reasons would be inappropriate. Asked several times if she thought this pressure was illegal, she said no.
  • Mr. Trudeau, Mr. Wernick, PMO officials and the Finance Minister’s chief of staff repeatedly reminded her or her staff about the then-upcoming Quebec provincial election. They feared a threat that SNC would move its Montreal headquarters, costing thousands of jobs, which would be politically disastrous to the Liberals.
  • Mr. Trudeau's principal secretary, Gerald Butts, at one point told her chief of staff there "is no solution here that doesn't involve some interference," and that the Prime Minister's chief of staff, Katie Telford, said "we don't want to debate legalities any more."
  • According to directives given to her then deputy minister, the next justice minister, David Lametti, would have conversations with Mr. Trudeau stressing that the SNC file was a priority.

Weeks after she testified in person, she backed up her version of events with a cache of documents submitted to the committee. She also gave them an audio recording of a December conversation with Mr. Wernick in which he said Mr. Trudeau was “in a pretty firm frame of mind” in his desire to settle the SNC case out of court. Ms. Wilson-Raybould replies:

We are treading on dangerous ground here – and I am going to issue my stern warning – because I cannot act in a manner and the prosecution cannot act in a manner that is not objective, that isn’t independent. This is the about the integrity of the government. ... This is going to look like political interference by the Prime Minister.
Listen to Jody Wilson-Raybould's recording of her Dec. 19, 2018, conversation with Michael Wernick, Clerk of the Privy Council. The Globe and Mail

When Mr. Butts came before the committee on March 6, he gave a different timeline of events, stating several times that he didn’t know Ms. Wilson-Raybould had made up her mind in September until after she had left the job in January. He also talked about events after the cabinet shuffle, things she said she couldn’t talk about. He claimed that Ms. Wilson-Raybould had been offered the Indigenous Services post, but turned it down because of concerns about enforcing the Indian Act, and that while Justice was her “dream job,” Mr. Trudeau had to move her to another post to avoid setting a precedent where ministers could say no to reassignment: “If you allow a minister to veto a cabinet shuffle by refusing to move, you soon will not be able to manage cabinet. It was not possible in this instance for the Prime Minister to go further than additionally offering the Veterans Affairs post.”

MORE READING ON JODY WILSON-RAYBOULD

Profile: Why Jody Wilson-Raybould was destined to speak truth to power

First Nations leaders question Wilson-Raybould’s decision to decline Indigenous Services post

Emily Riddle: The gaslighting of Jody Wilson-Raybould: Indigenous women have seen this before

What is the Public Prosecution Service of Canada?

At the heart of the SNC-Lavalin controversy is the PPSC, an independent agency that oversees federal prosecutions and looks into violations of the Canada Elections Act. Within that mandate, the PPSC’s director, called the Director of Public Prosecutions, essentially acts as the attorney-general’s deputy (though there is also a deputy justice minister in the House of Commons, currently Nathalie Drouin). The justice minister can’t give the DPP orders on election matters, but in any other kind of case, the minister can issue directives to them or even take charge of prosecutions. So in the SNC case, it would be within the justice minister’s power to ask the DPP to reach a settlement even if they had previously decided not to. And this could still happen: Mr. Lametti said on Feb. 10 that it’s still possible he could push for an out-of-court settlement.

Who’s who in the federal government

Elected

Appointed

Justin Trudeau

Prime Minister

David Lametti

Justice Minister

It is made up of the PM and the PM’s top political staff, who advise the PM.

Oversees Canada's justice system. Helps the federal government to develop policy and to draft and reform laws as needed.

Prime Minister’s Office (PMO)

The Privy Council Office (PCO)

Department of Justice (DOJ)

Public

Prosecution Service of Canada (PPSC)

Supports the PM and Cabinet. Led by the Clerk of the Privy Council, it helps the government in implementing its vision, goals and decisions.

Prosecutes federal offences and provides legal advice and assistance to law enforcement.

Michael Wernick

Clerk of the

Privy Council

Kathleen Roussel

Director of Public

Prosecutions

MURAT YUKSELIR / THE GLOBE AND MAIL

Who’s who in the federal government

Elected

Appointed

Justin Trudeau

Prime Minister

David Lametti

Justice Minister

It is made up of the PM and the PM’s top political staff, who advise the PM.

Oversees Canada's justice system. Helps the federal government to develop policy and to draft and reform laws as needed.

Prime Minister’s Office (PMO)

The Privy Council Office (PCO)

Department of Justice (DOJ)

Public

Prosecution Service of Canada (PPSC)

Supports the PM and Cabinet. Led by the Clerk of the Privy Council, it helps the government in implementing its vision, goals and decisions.

Prosecutes federal offences and provides legal advice and assistance to law enforcement.

Michael Wernick

Clerk of the

Privy Council

Kathleen Roussel

Director of Public

Prosecutions

MURAT YUKSELIR / THE GLOBE AND MAIL

Who’s who in the federal government

Elected

Appointed

It is made up of the PM and the PM’s top political staff, who advise the PM.

Oversees Canada's justice system. Helps the federal government to develop policy and to draft and reform laws as needed.

Justin Trudeau

Prime Minister

Prime Minister’s Office (PMO)

The Privy Council Office (PCO)

Department of Justice (DOJ)

Michael Wernick

Clerk of the

Privy Council

David Lametti

Justice Minister

Public

Prosecution Service of Canada (PPSC)

Supports the PM and Cabinet. Led by the Clerk of the Privy Council, it helps the government in implementing its vision, goals and decisions.

Prosecutes federal offences and provides legal advice and assistance to law enforcement.

Kathleen Roussel

Director of Public Prosecutions

MURAT YUKSELIR / THE GLOBE AND MAIL

More reading on the PPSC

Kathleen Roussel: The mandate and mindset of the top prosecutor pushing ahead with the SNC-Lavalin case

A glossary of denials

Watch: Prime Minister Justin Trudeau denies on Feb. 7 that his office 'directed' Jody Wilson-Raybould to help SNC-Lavalin avoid a criminal prosecution.

‘Directed’

The day The Globe’s original story broke, both Prime Minister Justin Trudeau and Mr. Lametti denied the reported allegations. But the wording of those denials is important. Here’s what Mr. Trudeau said, speaking at a news conference on transit funding in Vaughan, Ont., on Feb. 7:

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The allegations reported in the story are false. At no time did I or my office direct the current or previous attorney-general to make any particular decision in this matter.

Asked whether the PMO exerted any influence, he focused again on the word “direct”:

As I’ve said, at no time did we direct the attorney-general, current or previous, to make any decision whatsoever in this matter.

‘Pressure’

The Globe’s initial reporting never said that Mr. Trudeau had directed Ms. Wilson-Raybould to act, only that she was pressed to intervene and declined. On Feb. 7, Mr. Lametti did deny that he or Ms. Wilson-Raybould had been pressed on SNC:

As the Prime Minister said earlier today, neither the Prime Minister nor his office put my predecessor or myself under pressure nor gave any directives.

‘Discussed’

Then at a Vancouver news conference on Feb. 11, Mr. Trudeau acknowledged that he had discussed the SNC-Lavalin matter with Ms. Wilson-Raybould last fall, but did not address the allegations that she was pressured. Instead, he said he had met twice with Ms. Wilson-Raybould in Vancouver in recent days, and that:

She confirmed for me a conversation we had this fall where I told her directly that any decisions on matters involving the director of public prosecutions were hers alone.

Then on Feb. 15, after Ms. Wilson-Raybould’s resignation, Mr. Trudeau said she had approached him in September of 2018 to clarify whether he was ordering her to make a particular decision on the SNC prosecution. He said her question came amid a major lobbying campaign on the matter that included SNC and the Quebec premier:

Which is why Jody Wilson-Raybould asked me if I was directing her or going to direct her to take a particular decision, and I of course said, ‘No,’ that it was her decision to make and I expected her to make it. I had full confidence in her role.

‘Lawful advocacy’ and ‘inappropriate pressure’

At House justice committee hearings on Feb. 21, Mr. Wernick, the PCO chief, added a new phrase to the lexicon – “lawful advocacy” – which was how he described efforts by Mr. Trudeau and senior officials to persuade Ms. Wilson-Raybould to revisit the SNC settlement, and that there was no “inappropriate pressure” applied:

If you boil it down for Canadians as to what is going on here with the facts that we have and all of the facts that I know from my participation in meetings and conversations, we are discussing lawful advocacy.

Mr. Wernick stood by his “lawful advocacy” remarks when he was called back before the committee on March 6. But Ms. Wilson-Raybould’s Feb. 27 testimony to the committee stressed several times that, in her view, the pressure she faced had been “inappropriate.” Mr. Trudeau responded by saying he disagreed with Ms. Wilson-Raybould on that point:

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I therefore completely disagree with the former attorney-general’s characterization of events.

‘Normal operations of government’

When Mr. Butts testified on March 6, he denied that anything improper had happened, and that even if something was being done improperly, Mr. Trudeau would have “put a stop to it” had he known about it. In his written statement, he said the talks with Ms. Wilson-Raybould had been lawful and normal:

I am firmly convinced that nothing happened here beyond the normal operations of government. Highly trained legal staff in PMO worked closely with PCO’s legal team on all aspects of the file ... people may have a caricature in their mind based on media coverage about what a relationship between a minister and PMO staff looks like. This was certainly not that.

‘Erosion of trust’

At a March 7 news conference in Ottawa, Mr. Trudeau acknowledged that there had been frictions behind the scenes between his justice minister and the PMO, but said he didn’t know about them until it was too late:

What has become clear over the various testimonies is over the past months there was an erosion or trust between my office, my former principal secretary and the former attorney-general. I was not aware of that erosion of trust. As Prime Minister and leader of the federal ministry, I should have been.
Watch: Mr. Trudeau addressed the SNC-Lavalin affair on March 6, saying he didn’t realize there was an “erosion of trust” between his office and Ms. Wilson-Raybould.

Who’s left the fold

Ms. Wilson-Raybould hasn’t been the only one to leave an important political post since the SNC controversy began: It’s also cost Mr. Trudeau another cabinet minister and a top aide. Here’s more about them.

Jane Philpott

Jan. 14, 2019: New Treasury Board president Jane Philpott addresses the media after a swearing-in ceremony at Rideau Hall.

Adrian Wyld/The Canadian Press

Alongside Ms. Wilson-Raybould, who became a close friend after the 2015 election, Ms. Philpott was a star in the Trudeau cabinet, serving variously as ministers for health, Indigenous services and finally as president of the Treasury Board. On March 4, she abruptly quit cabinet, saying in her resignation letter she had “serious concerns” about Mr. Trudeau’s alleged behaviour and lost confidence in how he handled the SNC issue:

The solemn principles at stake are the independence and integrity of our justice system. It is a fundamental doctrine of the rule of law that our Attorney General should not be subjected to political pressure or interference regarding the exercise of her prosecutorial discretion in criminal cases. Sadly, I have lost confidence in how the government has dealt with this matter and in how it has responded to the issues raised.

Ms. Philpott was dropped from the Liberal caucus on April 2. Like Ms. Wilson-Raybould, she plans to run as an independent in October’s election.

More reading on Jane Philpott

Profile: Philpott puts her political capital behind her friend

Campbell Clark: The loss of Philpott has turned the SNC-Lavalin controversy into a crisis

Gerald Butts

Dec. 9, 2016: Principal secretary Gerald Butts, right, and chief of staff Katie Telford watch their boss, Mr. Trudeau, speak at a first ministers' meeting in Ottawa.

Chris Wattie/Reuters

Aside from Ms. Wilson-Raybould, the SNC affair has taken another political casualty among the Prime Minister’s inner circle: Mr. Trudeau’s principal secretary and old friend, Gerald Butts. In a Feb. 18 letter, he announced he was quitting his PMO job to protect the office from the accusations of political influence, which he categorically denied:

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I categorically deny the accusation that I or anyone else in his office pressured Ms. Wilson-Raybould. We honoured the unique role of the Attorney General. At all times, I and those around me acted with integrity and a singular focus on the best interests of all Canadians.
... Any accusation that I or the staff put pressure on the Attorney General is simply not true. Canadians are rightly proud of their public institutions. They should be, because they work. But the fact is that this accusation exists. It cannot and should not take one moment away from the vital work the Prime Minister and his office is doing for all Canadians. My reputation is my responsibility and that is for me to defend. It is in the best interests of the office and its important work for me to step away.

The exit of Mr. Butts, an important engineer the Liberals’ 2015 election victory, leaves Mr. Trudeau without one of his two top aides at a crucial time ahead of the 2019 election. The other top aide, chief of staff Katie Telford, is now the most senior political operative in the PMO. She is expected to step aside for campaign work in the leadup to the October election race.

MORE READING ON GERALD BUTTS

Gerald Butts on the SNC-Lavalin affair: What you missed from March 6’s hearings, and what it means

Campbell Clark: Canadians must now judge who is more credible: Gerald Butts or Jody Wilson-Raybould

Konrad Yakabuski: Gerald Butts’s master class in taking down an adversary

John Ibbitson: Butts, Wernick testimony ensures SNC-Lavalin will hang over Liberals until election

The reaction so far

Conservative Leader Andrew Scheer rises during Question Period on Feb. 7, 2019.

Adrian Wyld/The Canadian Press

Opposition: After Ms. Wilson-Raybould’s testimony, Conservative Leader Andrew Scheer called on the Prime Minister to resign, saying he had “lost the moral authority to govern.” NDP Leader Jagmeet Singh has called for a public inquiry of the SNC-Lavalin affair.

Liberal caucus: MPs in Mr. Trudeau’s party have generally kept quiet about Ms. Wilson-Raybould’s allegations or publicly backed the Prime Minister. The Globe canvassed 179 MPs to see what they thought: More than 30 responded, with most defending Mr. Trudeau’s actions. Here’s a compendium of their responses.

SNC-Lavalin: CEO Neil Bruce told The Globe he was unaware of any political pressure related to their DPA request, and didn’t comment on how Mr. Lametti would handle the file as justice minister.

Who’s looking into this, and who isn’t

House justice committee: This committee conducted a broad study of SNC and deferred prosecution agreements in general, not focused specifically on the allegations of interference. It voted on March 19 not to hear any further witnesses, despite motions from the opposition to keep going. Before that, it heard testimony from Ms. Wilson-Raybould on Feb. 27 and Mr. Butts on March 6, and twice from the Privy Council Clerk and deputy justice minister.

Ethics commissioner: At the behest of two NDP MPs, Ethics Commissioner Mario Dion announced on Feb. 11 that he would look into the matter under the terms set out in the Conflict of Interest Act.

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Anne McLellan: On March 18, Mr. Trudeau named a former Liberal justice minister as a special independent adviser to look into whether the roles of justice minister and attorney-general should be separated. She’s due to give Mr. Trudeau her findings by June 30.

OECD: In 1999, Canada signed on to a global anti-bribery convention overseen by the Organization for Economic Co-operation and Development. The OECD’s working group on bribery announced on March 11 that it is concerned by the SNC allegations and would monitor the outcome of the various investigations.

RCMP: Mr. Scheer of the Conservatives wrote to the RCMP’s Commissioner on Feb. 28 asking for an investigation. But Ms. Wilson-Raybould has not alleged any criminal wrongdoing, and legal experts are divided on whether a police probe is warranted. Mr. Trudeau has said that no one from the RCMP has contacted him or his staff in regard to SNC.

Analysis and commentary

Editorial: For Justin Trudeau, is it too late now to say sorry?

Campbell Clark: Trudeau’s high-EQ image doesn’t mesh with the management style that has been revealed

Konrad Yakabuski: Sorry, Justin Trudeau: Jody Wilson-Raybould and Jane Philpott aren’t the villains here

Andrew McDougall: Trudeau channels Trump as he ejects Wilson-Raybould and Philpott from caucus

Eric Reguly: SNC-Lavalin’s probable exodus from Canada is a national shame

Margaret Wente: Who do you trust, Jody or Justin?

John Ibbitson: Leak detailing Supreme Court appointment rift only shows how little Trudeau’s camp respects the rule of law

Lawrence Martin: Jody Wilson-Raybould should quit the Liberal caucus

Martha Hall Findlay: Wilson-Raybould and Philpott aren’t principled because they’re women. They’re just principled

Readers’ views: From the comments

‘Ethical Liberals are being forced out of the party.’ Readers respond to ousting of Wilson-Raybould and Philpott from Liberal caucus

'Who was trying to pressure whom?’ Readers respond to reports of disagreement between prosecutors on SNC-Lavalin

Readers respond to poll reporting more than half of Canadians support criminal trial for SNC-Lavalin

‘Either we are a law abiding country or we aren’t.’ Readers respond to Wilson-Raybould testimony

Did the PMO advocate for SNC or place pressure on Wilson-Raybould? Readers discuss Michael Wernick’s testimony

Should the Jody Wilson-Raybould case be viewed through the lens of feminism? Readers debate

Is Trudeau’s management style the problem in the SNC-Lavalin case, or is the nature of modern politics to blame? Readers discuss

Compiled by Globe staff

With reports from Robert Fife, Steven Chase, Sean Fine, Shawn McCarthy, Justine Hunter, Paul Waldie and The Canadian Press

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