Canada: Canada's Big Anti-Bribery Case Ends In Dismissed Charges

Last Updated: February 16 2017
Article by Cyndee Todgham Cherniak

On February 10, 2017, three former executives of SNC-Lavalin Group Inc. saw Corruption of Foreign Public Officials Act (Canada) charges withdrawn in the Ontario Superior Court. Former SNC vice-president of energy and infrastructure Kevin Wallace, former SNC vice-president of international development Ramesh Shah, and Bangladeshi-Canadian businessman Zulfiquar Ali Bhuiyana were charged with bribing an official in Bangladesh.  This is Canada's most significant and high profile anti-bribery prosecution against corporate executives.

The charges related to a bid to win a $50 million contract to supervise the Padma Bridge construction.  The Crown's case had been based on evidence obtained from a Royal Canadian Mounted Police ("RCMP") wire tap.

Justice Ian Nordheimer ruled a month ago that the wire tap evidence had to be excluded because of problems with three applications the RCMP filed in 2011 to get court approval to use wiretaps.  This decision taken in January was subject to a publication ban until February 10th.

In the wire tap decision, Justice Nordheimer held:

"Reduced to its essentials, the information provided in the [wiretap applications] was nothing more than speculation, gossip and rumour. ... Nothing that could fairly be referred to as direct factual evidence, to support the rumour and speculation, was provided or investigated. The information provided by the tipsters was hearsay (or worse) added to other hearsay."

For more information about the background facts in Canada's most significant Corruption of Foreign Public Officials Act case, it is important to read World Bank Group v. Wallace, [2016] 1 SCR 207, 2016 SCC 15 (CanLII).  In this case, the Supreme Court of Canada summarized in the head note certain facts relating to the evidence as follows:

"The RCMP then sought and obtained authorizations to intercept private communications in order to obtain direct evidence of the accused's participation in corruption, as well as a search warrant. Sgt. D was assigned to prepare affidavits for the application. He largely relied on information the INT shared based on its communications with the tipsters, as well as knowledge of the bidding process of a senior investigator with INT. Sgt. D also spoke directly to one of the tipsters. Sgt. D did not make any handwritten notes of his work as affiant. All of his emails for the period of the investigation were lost because of a computer problem, though many were recovered through other sources."

It is also necessary to review Drywall Acoustic Lathing and Insulation, Local 675 v. SNC-Lavalin Group Inc., 2015 ONCA 718 (CanLII) and Chowdhury v. H.M.Q., 2014 ONSC 2635 (CanLII).  While these cases are not about the charges against the three former executives, they do give background information about the underlying bribery allegations.

Without the wire tap evidence, the prosecution concluded there was not a prospect of conviction. The case against the individuals is now over – however the reputational damage against the individuals and the company (SNC-Lavalin) will continue.  All were convicted in the court of public opinion long ago.

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