Harper Ex-Chief of Staff Broke Law, Canada Police Allege

Nigel Wright, Prime Minister Stephen Harper’s former chief of staff, broke the law by helping a senator repay about C$90,000 ($86,150) of improperly claimed expenses, Canada’s federal police allege.

Mike Duffy, formerly a senator for the governing Conservative Party, is also alleged to have committed a crime by accepting the funds, according to documents filed today. The Royal Canadian Mounted Police allege Duffy and Wright committed offenses under the sections of the Criminal Code dealing with bribery of public officials, fraud and breach of trust, according to the documents. Neither of the men have been charged and none of the allegations have been proved in court.

The Senate controversy has dogged Harper’s Conservatives, driving down the party’s poll ratings to the lowest since he took office in 2006. Harper has denied knowledge of the payment to Duffy.

“I believe that the controversy was an embarrassment for the government, and that Mr. Wright believed that Senator Duffy morally and ethically should not have filed the expense claims,” Corporal Greg Horton, an investigator with the Royal Canadian Mounted Police, said in an application to the Ontario Court of Justice to obtain documents connected to the case.

Wright, a former managing director at Toronto-based private-equity firm Onex Corp. (OCX), resigned as Harper’s chief of staff in May following the disclosure he paid Duffy to help cover ineligible expense claims related to housing.

Duffy Speech

“My intention was always to secure repayment of funds owed to taxpayers,” Wright said in an e-mailed statement provided by his lawyer, Peter Mantas. “I acted within the scope of my duties and remain confident that my actions were lawful.”

In a speech in the Senate last month, Duffy said he didn’t break the upper house’s rules for expenses, and said he was the victim of an “avalanche of untruths and character assassination.”

Janice Payne, an Ottawa lawyer listed in today’s documents as having represented Duffy at the time of the payment, didn’t immediately return a phone call seeking comment on the allegations. Donald Bayne, a lawyer who has also represented Duffy in the matter, didn’t immediately return a similar call.

Deloitte Audit

Duffy agreed to repay the money under conditions agreed with the prime minister’s office, including that Duffy be withdrawn as the subject of an audit by Deloitte LLP, Horton alleged. The conditions also included an acknowledgment that Duffy hadn’t violated the senate’s residency requirements, and that Conservative lawmakers speak about the matter with “agreed-upon media lines,” Horton alleged in the court documents.

The prime minister’s office “influenced” three Conservative senators reviewing Duffy’s expense claims to change a report on the spending “to reflect wording that the PMO wanted,” Horton alleged.

Canada’s Senate earlier this month suspended Duffy and two other former Conservative senators, Pamela Wallin and Patrick Brazeau, over allegations they improperly claimed expenses. Wallin and Brazeau have also rejected the allegations.

“The allegations are about an arrangement between Nigel Wright and Mike Duffy,” Carl Vallee, a spokesman for Harper, said in an e-mail. “Because of their inappropriate actions, Mike Duffy has been suspended without pay as a Senator and Nigel Wright no longer works for the government. We have responded fully and freely to every request for assistance, including any and all documents requested.”

To contact the reporters on this story: Andrew Mayeda in Ottawa at amayeda@bloomberg.net; Theophilos Argitis in Ottawa at targitis@bloomberg.net

To contact the editor responsible for this story: David Scanlan at dscanlan@bloomberg.net

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