Thursday, September 23, 2010


BC Rail Political Corruption Trial: Thursday, Sept. 23, 2010

The Canadian Press
Published: September 23, 2010

VANCOUVER - A lawyer at the legislature raid trial in Vancouver says BC Rail was in good financial shape when it was sold to CN Rail for $1 billion, despite claims that the Crown corporation was a money loser. {Snip} ...

Defence lawyer Kevin McCullough, who represents one of three former government employees in the political corruption case, continued Thursday in British Columbia Supreme Court to cross-examine a member of the committee that approved the sale. {Snip} ...

"Did Mr. Mahoney tell you, sir, that in 2002 BC Rail had a great year, that in 2003 they were having a solid year, and that they told the government that although there was risk we could manage the railway under the existing restrictions, no new debt, no debt forgiveness, and no subsidies?" McCullough asked the witness.

Kenning said he couldn't recall Mahoney making such a statement, though he couldn't rule out that it happened.

Last week, Kenning denied that the "fix was in" for CN Rail to win the bid.

BC Rail's former president has suggested he was let go in 2001 because he opposed a plan to run the company into the ground.

Mark Mudie said in court documents pertaining to his wrongful dismissal lawsuit that the "failure strategy" would have strengthened the case for selling the railway.

McCullough accused Kenning Thursday of tailoring his testimony.

"BC Rail was a company that was not only making money, but the complaint that you've suggested — that they had a poor operating ratio, the justification you'd suggested for sale — is simply a bogus justification," McCullough said.

Operating ratio compares a company's sales figures to its operating expenses ...

Read more HERE. And HERE.

and HERE.

BC Rail director sat in CIBC box at Canucks games, trial told

Vancouver Sun - September 23, 2010

VANCOUVER - A director of BC Rail testified today at a political corruption trial that he accepted seats in the CIBC [Canadian Imperial Bank of Commerce] private box for Vancouver Canucks game.
But Brian Kenning couldn't recall whether it was before or after CIBC was awarded the untendered $6.1-million contract to act as financial advisor for the BC Rail sale.

"I think I went to one or two games," the witness recalled about sitting in CIBC's private box.

"You don't recall it was before CIBC got the $6-million contract?" asked defence lawyer Kevin McCullough.

"I've been to the CIBC box two to four times in my lifetime. I can't recall when," Kenning replied.

Asked if he considered it appropriate to attend the CIBC box for Canucks hockey games during the BC Rail transaction, Kenning replied: "I never really thought about it."

{Snip} ...

The Crown contends Basi and Virk leaked confidential information about the BC Rail bidding process to a lobbyist representing one of the bidders, OmniTrax, in exchange for cash and other benefits.

Basi's cousin, Aneal Basi, is accused of money laundering.

At the time. Dave Basi was the top political aide to finance minister Gary Collins and Virk was ministerial assistant to transportation minister Judith Reid.

Aneal Basi worked in communications for the transportation ministry.

The government announced on Nov. 25, 2003, that CN Rail was the winning bidder to take over BC Rail operations. The $1-billion deal was finalized in 2004.

The defence contends there was a bias in favour of selling to CN because the chair of CN was David McLean, the chief fundraiser for Gordon Campbell's 1996 election campaign.

The government contends the deal was not a sale but a long-term lease of 60 years, with option renewals of up to 990 years.

The police investigation led to search warrants being executed on the legislature on Dec. 28, 2003.

Gary Collins, the former finance minister, is expected to testify next week.

Read more HERE.


Bias allegation raised during B.C. Rail sale

By Keith Fraser, The Province September 22, 2010

 A former B.C. Rail board member offered to resign from a committee handling the controversial sale of the Crown corporation when an allegation of bias was levelled against him, the Basi-Virk trial heard Tuesday.
The allegation against Brian Kenning was revealed during the fifth day of his cross-examination at the government corruption trial.

Under questioning from defence lawyer Kevin McCullough, Kenning admitted that board chairman John McLernon told him that MLA Pat Bell had complained about a comment Kenning made that allegedly revealed a perception of bias ...

Read more HERE.


Ex-B.C. Rail board member unable to recall details of perks

The Province - Sept. 23, 2010

Former B.C. Rail board member Brian Kenning accepted invitations to the CIBC corporate box at Canucks games, the Basi-Virk trial heard Thursday.

But Kenning could not say whether he attended the games before or after the investment banker was awarded a $6-million untendered contract as financial advisor on the sale of BC Rail.

Kenning has been on the witness stand for more than a week. The next witness is expected to be former finance minister Gary Collins. It’s anticipated he’ll be testifying some time next week. {Snip}

Read more HERE.

A comment which bears repeating:

North Van's Grumps has left a new comment on "BC Rail Political Corruption Trial: Thursday, Sept. 23":

"Optics" has been the word that the Defense team has been using at the BC Rail trial, and the optics of laying charges should have been laid on with an even hand.

How about this for similarities with strikingly different results on the part of the police, and Special Prosecutor.

Dave Basi and Bobby Virk leave their safe haven of Victoria to go to Denver, Colorado where Omnitrax picks up their tabs for their attending one football game. Omnitrax was in the running for a chance to be the winning bidder for BC Rail: Result: Breach of Trust charges are laid against Dave Basi and Bobby Virk.

That's fair, they're Government officials.

Witness Kenning on the other hand is invited by CIBC World Markets to sit in their box to watch a Vancouver Canucks hockey game, up to four times. CIBC World Markets "won" an untendered contract for the BC Rail Marine division and then went on to run the sale of the freight division of BC Rail deal where "leaks" occurred in the process. Fees paid to CIBC World Markets by BC Rail: over $6 million dollars in 2004.

Nothing wrong with the latter, attending free functions, so says Witness Kenning, its done all of the time.

Kevin McCullough then reminds the Witness of his earlier testimony on how the six Directors went about deciding who was to be their investment banker.

There wasn't a list of names presented, just blank pieces of paper*. Amazingly they all wrote down CIBC World Markets.

BC Mary comment:  *also known as carte blanche. 

Thursday's trial ended at 3:00.

Next court date is set for Monday, September 27th at 10:00
Apparently Canadian Press yanked the story on your first link, it's dead.

What is it with elites and Pro hockey? Maybe they are grateful to have some "celebrities" to justify their hugely inflated incomes?

Try again. I think it's OK.

My god mary is this all it's going to be I don't know I don't recall I'm not sure... How can this continue why can't the judge compell them to testify.
I'm in agreement with an earlier post that said martin brown should have spent the summer recess in jail for contempt of court.
And what ever happened to the whole mess of the Libs shredding documents and emails pertaining to the bc rail case that was before the courts during an election no less.
Finally a big thank you to all the posters here who keep me informed
thanks everyone
Wouldn't CIBC keep a record of those who've attended games using their facilities? Of course they would! Maybe it's time for a memory refresher?

I know exactly what you mean ...

but y'know what?

These illustrious members of Gordo's Gang are telling us an awful lot already ... in their own peculiar way.

And soon we'll see/hear Gary Collins testimony. Oh, the questions! One of which is: is Gary Collins still a member of that Gang, or not?
Some more great information. I hope the defence plans to call the BCR auditors to the stand. The Tumbler line writedown would have to be well documented. It would be interesting to see what criteria they used. I recall rumours that the government had approvals in place for the other mines at the same time...

It looks like all the loose ends are going to bite somebody in the butt!!!

It scares me how often has this happend outside of the public eye?

BCR Piglet

"What role did CIBC World Markets play in the sale of B.C. Rail?

Hon. G. Collins: Again, I'm not the minister responsible, but they were, to the best of my knowledge, providing financial advice to Mr. Trumpy's team of advisers."

snipped from Hansard, which means you can find it on your own accord.

Mr. Trumpy's team of advisers????

Mr. Trumpy was on the Evaluation board of BC Rail or was their another team that Mr. Trumpy was participating in with the sale of bc rail?

BC Rail Board of Directors hired Cibc..........
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