British Columbia Railway

[Milne]

Tainted BC Rail sale.

POSTED AT 6:20 AM EST Wednesday, Mar. 3, 2004

Bribery suspicions prompted B.C. raid

Police suspected officials might have been trading in secret information



By MARK HUME
From Wednesday's Globe and Mail

Vancouver — The RCMP raided the British Columbia Legislature in December because investigators suspected two officials were offered or had taken bribes to trade in secret government information.The government's controversial $1-billion sale of BC Rail to CN is one of the deals at the centre of the politically explosive investigation, according to police.

Those sketchy details were revealed yesterday when the Supreme Court of B.C. released a case summary that for the first time gave official confirmation of the primary focus of the investigation. The case has fuelled a media firestorm in B.C., and has shaken the Liberal government of Premier Gordon Campbell because key figures are ministerial aides, prominent fundraisers and organizers for the party at both the federal and provincial levels.

http://www.globeandmail.com/servlet/story/RTGAM.20040303.uraids0303/BNStory/National/


CanWest News Service

Wednesday, March 03, 2004

VANCOUVER - The British Columbia government was accused last November by Canadian Pacific Railway of leaking confidential competitive information to a rival railway during a fierce bidding war for ownership of BC Rail, The Vancouver Sun has learned.

A letter obtained from Premier Gordon Campbell's office through a Freedom of Information request shows CPR officials feared the government's handling of the BC Rail sale was "extremely prejudiced" and would lead to higher prices for shippers in the BC Rail service area.

The letter was written on Nov. 21, 2003, four days before Mr. Campbell introduced the acknowledged front-runner, Canadian National Railway, as the successful bidder in a $1-billion deal to privatize BC Rail.

The sale of BC Rail was identified as a key element in last December's RCMP raid on the provincial legislature, according to a summary of search warrant materials also released yesterday by the Associate Chief Justice of the Supreme Court of British Columbia.

That document, which suggests the $1-billion sale of BC Rail may be tainted by influence-peddling, fraud and corruption, is a five-page summary of the police investigation into breach-of-trust allegations and seven searches on Dec. 28 at the B.C. legislature and the homes and offices of people with ties to the provincial or federal Liberals.

The summary suggests two officials at the legislature may have been offered promotion or employment opportunities in exchange for sharing confidential government information. "The primary focus of the RCMP investigation is whether official 1 and official 2 were offered and/or accepted personal benefits as consideration for their co-operation, assistance or exercise of influence in connection with government business, including BC Rail," says the document prepared by the special prosecutor in the case.

http://www.canada.com/national/nationalpost/news/story.html?id=5bbe1e5f-a2fe-4d54-a5a9-aca504145612

[BoxcabE50]

:eek: It's amazing to learn some of what goes on behind the scenes. And scary as well.

Does this in any way hinder the sale? Or did it close anyhow? One reason that I ask this is we just recently did a revamping of our Fallen Flags Forums. Adding one for BCR. We might move this topic over there, provided that BCR is truly a Fallen Flag....?

Please post any further developments! This could be really interesting to follow!

:confused:

Boxcab E50

[Milne]

TODAY'S PAPER


RCMP probe derails BC Rail privatization pact


By PETER KENNEDY
Thursday, March 11, 2004 - Page A8


VANCOUVER -- The British Columbia government has been forced to cancel the privatization of a port subdivision of BC Rail's operation after it was revealed that the potential deal is part of a widening RCMP investigation involving the Crown-owned railway.

Transportation Minister Kevin Falcon said the deal was cancelled amid fears that advisers to one of the bidders for a 38-kilometre section of track that serves the giant Roberts Bank coal terminal south of Vancouver may have received confidential information that would have affected the government's ability to receive fair value for the assets being sold.

The decision to delay the deal comes after the RCMP raided the B.C. Legislature in December because investigators suspected that two key officials were offered or had taken bribes to trade in secret government information.

But the deal should not have an impact on the $1-billion sale of BC Rail's freight operations to Canadian National Railway, which is expected to close after a review by the Federal Competition Bureau, Mr. Falcon said. "I and the evaluation committee are confident the province accepted the best proposal for the BC Rail-CN partnership and did indeed receive fair value," he said.

The Roberts Bank line was being sold separately from BC Rail's main freight operations.

Yesterday's announcement comes only after the province was assured that the information being released would not jeopardize the continuing RCMP investigation, which follows the raid on the offices of David Basi and Bob Virk, former aides to Finance Minister Gary Collins and former transportation minister Judith Reid, respectively.

"We will not revisit the bidding process until the RCMP investigation is completed," Mr. Falcon said.

The province had planned to sell the subdivision for between $70-million and $100-million to three potential bidding groups, including CN, CP Rail and the Vancouver Port Authority; U.S. company Omnitrax and McQuarrie of Australia; or Southern Railway, which is owned by U.S. shipping magnate Dennis Washington.

However, Mr. Falcon said he was unable to name any of the advisers who may have been in possession of information that would have hindered the province's ability to get a fair price for its assets.

Last week, the Supreme Court of B.C. released vague details of an RCMP investigation that indicated that two key government officials may have been involved in a scheme to trade confidential information for bribes.

New Democratic Party Leader Carole James said the Liberals have consistently denied that police investigations have compromised government business, but now it's been forced to dump a deal.