Nov 06, 2007 04:30 AM
Bruce Campion-Smith
Ottawa Bureau Chief
OTTAWA–Federal government lawyers likely would not have recommended a $2 million payout to Brian Mulroney had they known about his financial dealings with Karlheinz Schreiber, says Eddie Goldenberg, Jean Chrétien's former top adviser.
"Knowing then what we know now, I would doubt that the department of justice would have recommended a settlement and frankly I would doubt that the government of the day, the minister of justice of the day, would have agreed to that recommendation," he said in an interview.
Chrétien was the prime minister who signed off on the cash settlement with Mulroney in January 1997.
Mulroney, prime minister from 1984 until 1993, had sued the federal government after the justice department named him in a letter alleging his involvement in a kickback scheme for Air Canada's purchase of Airbus jetliners in 1988.
At the time of the settlement, the government was under the impression that Mulroney had had only limited dealings with Schreiber, the alleged architect of the scheme.
In a transcript of an examination for discovery held in 1996, Mulroney was asked a question about Schreiber and replied, "I had never had any dealings with him."
But it was later revealed that the former prime minister had received $300,000 from Schreiber. He says he had sought Mulroney's help launching a chain of pasta restaurants and on behalf of a German-based company that wanted to set up an armament plant in Quebec.
But Goldenberg, who was Chrétien's senior policy adviser at the time, suggested the prime minister was in the dark about the extent of Mulroney's dealings with Schreiber, a fact he says that might have changed the government's willingness to offer a settlement.
Last week, the CBC's fifth estate and The Globe and Mail reported that Mulroney delayed paying taxes on the $300,000 he got from Schreiber.
"I further doubt that the government would have agreed if those facts were on the record at the time," Goldenberg said in an interview yesterday.
"The very fact that he had had monetary dealings with Mr. Schreiber. ...
"He had at least let it be believed that he didn't have any monetary dealings with him," Goldenberg said.
Instead, he said that Chrétien accepted the recommendation of the justice department to settle with Mulroney.
"At the time, the department of justice recommended to the minister of justice and attorney general that they settle for whatever reasons," Goldenberg said.
"It was very much a recommendation from the department of justice to the minister of justice. ... He accepted that recommendation and he made that recommendation and the prime minister accepted it right away. There wasn't much debate."
But Mulroney spokesperson Luc Lavoie says the $300,000 paid by Schreiber has become a red herring and had nothing to do with the Airbus affair.
Instead, it was meant as payment for Mulroney's help with business ventures.
"This retainer was paid after Mr. Mulroney left office and was in no way connected with the Airbus transaction," Lavoie said yesterday in an email.
And he said when the RCMP finally closed their investigation into the Airbus affair in 2003 and cleared Mulroney of any wrongdoing, "they had known for a full two years about the $300,000 retainer," Lavoie said.
Chrétien himself says he was relieved when the government settled out of court, saying it spared Mulroney, the police and "the reputation of all our public institutions and officials."
But then he admits his own surprise at news of the payments received by the former prime minister.
"Of course, I was as mystified as every other Canadian when Mulroney later admitted to having received $300,000 in cash payments from Schreiber after leaving office," Chrétien writes in his new book titled My Years as Prime Minister.
"However, as I told my officials, the only proper thing to do was to accept the word of a former prime minister of Canada," he said.
Prime Minister Stephen Harper has rebuffed opposition demands for an inquiry, but it's not likely to dampen calls for an accounting of Mulroney's business dealings with Schreiber.
Bruce Campion-Smith
Ottawa Bureau Chief
OTTAWA–Federal government lawyers likely would not have recommended a $2 million payout to Brian Mulroney had they known about his financial dealings with Karlheinz Schreiber, says Eddie Goldenberg, Jean Chrétien's former top adviser.
"Knowing then what we know now, I would doubt that the department of justice would have recommended a settlement and frankly I would doubt that the government of the day, the minister of justice of the day, would have agreed to that recommendation," he said in an interview.
Chrétien was the prime minister who signed off on the cash settlement with Mulroney in January 1997.
Mulroney, prime minister from 1984 until 1993, had sued the federal government after the justice department named him in a letter alleging his involvement in a kickback scheme for Air Canada's purchase of Airbus jetliners in 1988.
At the time of the settlement, the government was under the impression that Mulroney had had only limited dealings with Schreiber, the alleged architect of the scheme.
In a transcript of an examination for discovery held in 1996, Mulroney was asked a question about Schreiber and replied, "I had never had any dealings with him."
But it was later revealed that the former prime minister had received $300,000 from Schreiber. He says he had sought Mulroney's help launching a chain of pasta restaurants and on behalf of a German-based company that wanted to set up an armament plant in Quebec.
But Goldenberg, who was Chrétien's senior policy adviser at the time, suggested the prime minister was in the dark about the extent of Mulroney's dealings with Schreiber, a fact he says that might have changed the government's willingness to offer a settlement.
Last week, the CBC's fifth estate and The Globe and Mail reported that Mulroney delayed paying taxes on the $300,000 he got from Schreiber.
"I further doubt that the government would have agreed if those facts were on the record at the time," Goldenberg said in an interview yesterday.
"The very fact that he had had monetary dealings with Mr. Schreiber. ...
"He had at least let it be believed that he didn't have any monetary dealings with him," Goldenberg said.
Instead, he said that Chrétien accepted the recommendation of the justice department to settle with Mulroney.
"At the time, the department of justice recommended to the minister of justice and attorney general that they settle for whatever reasons," Goldenberg said.
"It was very much a recommendation from the department of justice to the minister of justice. ... He accepted that recommendation and he made that recommendation and the prime minister accepted it right away. There wasn't much debate."
But Mulroney spokesperson Luc Lavoie says the $300,000 paid by Schreiber has become a red herring and had nothing to do with the Airbus affair.
Instead, it was meant as payment for Mulroney's help with business ventures.
"This retainer was paid after Mr. Mulroney left office and was in no way connected with the Airbus transaction," Lavoie said yesterday in an email.
And he said when the RCMP finally closed their investigation into the Airbus affair in 2003 and cleared Mulroney of any wrongdoing, "they had known for a full two years about the $300,000 retainer," Lavoie said.
Chrétien himself says he was relieved when the government settled out of court, saying it spared Mulroney, the police and "the reputation of all our public institutions and officials."
But then he admits his own surprise at news of the payments received by the former prime minister.
"Of course, I was as mystified as every other Canadian when Mulroney later admitted to having received $300,000 in cash payments from Schreiber after leaving office," Chrétien writes in his new book titled My Years as Prime Minister.
"However, as I told my officials, the only proper thing to do was to accept the word of a former prime minister of Canada," he said.
Prime Minister Stephen Harper has rebuffed opposition demands for an inquiry, but it's not likely to dampen calls for an accounting of Mulroney's business dealings with Schreiber.
