BASI-VIRK: Was there a BC Liberal cabinet leak on $1 billion sale of BC Rail? Newly released evidence shows Gary Collins stunned by lobbyists' info in 2004 police interview

Christy Clark - her campaign declined comment

Gary Collins & Gordon Campbell

Railgate: Was There a Cabinet Leak to Lobbyists?


Ex-Finance Minister Gary Collins told police he was surprised at 'blow by blow' description of cabinet meeting in lobbyists' memo to bidder for BC Rail.

By Bill Tieleman 

TheTyee  February 24, 2011

"But, I mean, this is, it reads to me like someone who's more sitting there observing, right?"

- Former B.C. finance minister Gary Collins describing a lobbyists' briefing note about a cabinet meeting to police, Nov. 3, 2004.

How did lobbyists for one of two bidders in the $1 billion privatization of BC Rail come to know the inner discussions of a BC Liberal cabinet meeting about the sale?

Was there a cabinet leak?

That's one of the most intriguing questions arising from new police evidence from the B.C. Legislature Raid case released by the courts late last week, including two lengthy interviews with then B.C. finance minister Gary Collins.

Collins strongly suggests to police in 2004 that those lobbyists had a "sort of blow by blow of the cabinet meeting."

Collins' former ministerial assistant, David Basi, pled guilty to breach of trust and fraud for admitting he was paid cash and benefits for giving lobbyists Erik Bornmann and Brian Kieran confidential BC Rail documents.

Bob Virk, former ministerial assistant to then transportation minister Judith Reid, also pled guilty.

Basi and Virk were sentenced to two years house arrest but in a controversial decision, the B.C. government agreed to pay their $6 million legal fees in the lengthy case.

Media reporting to date has focused on two themes -- that police found no wrongdoing on the part of elected BC Liberal MLAs and that Basi engaged in a series of obscenity-laced wiretapped conversations about colleagues, lobbyists and others, including references to the sexual exploits of one contact.

Only media accredited by B.C. Supreme Court can access the more than 1,000 pages of police reports, wiretap transcripts, interview and other material RCMP used to build their case, under an order issued by presiding trial judge Associate Chief Justice Anne MacKenzie.

And that material is but a proverbial drop in the bucket of more than one million pages of evidence disclosed by the special prosecutor, representing the Crown, to the defence.

But what has so far gone unreported goes to the heart of the defence's argument that some of the confidential information obtained by Bornmann, Kieran and business partner Jamie Elmhirst -- who jointly owned Pilothouse Public Affairs -- could not have come from Basi or Virk.

Central to that theory is the evidence given by Collins in police interviews after the unprecedented Dec. 28, 2003 raid on the B.C. legislature in which dozens of boxes of material from Basi and Virk's offices were seized.

'I have always discharged my duties honourably': Clark

Last week's disclosure of selected evidence was the result of negotiations between police and the Crown with CTV news and the Globe and Mail newspaper, which made a court application for the prosecution's documents.

The Globe headline on Feb. 17 stated that: "Corruption probe exonerates Clark in BC Rail scandal."

That headline reflected what the RCMP had made already made clear -- namely that Clark and other elected officials had not been under investigation.

The RCMP told the media and public one day after the B.C. legislature raid took place December 28, 2003 that "no elected officials" were under investigation.

Eight years later the Globe reported that: "An exhaustive police investigation into political corruption surrounding the sale of BC Rail found no evidence of wrongdoing by former BC Liberal cabinet minister Christy Clark or any other elected official."

CTV took a similar tack, saying that Clark had been "cleared" and quoted her as saying:

"All along, this has been something that people with a political agenda have been trying to drag me into. Those people have a political agenda; they're not speaking about reality when they throw all this mud."

Neither Collins nor Clark was ever charged with anything. Clark was not even interviewed by the RCMP at the time.

Not surprisingly, Clark concurred with the Globe's conclusion.

"Two people have been convicted of accepting bribes who worked for the government. I mean, that's unacceptable," Clark told the Globe. "From a personal perspective it confirms what I've been saying from the beginning. I have a spotlessly clean public record, I have always discharged my duties honourably."

No need for public inquiry: Clark

By journalists, however, Clark has been questioned repeatedly about her role in the sale of BC Rail and her connections to some of the key players in it.

But she has steadfastly rejected calls for a public inquiry, as have fellow leadership candidates Kevin Falcon, George Abbott and Mike de Jong -- who were also cabinet ministers when BC Rail was sold in a BC Liberal broken election promise.

And a Christy Clark campaign spokesperson declined email and telephone requests for an interview with The Tyee for this article.

However, what was disclosed to the Globe and CTV, and subsequently all court-accredited media [of which I am one] but not the public or other journalists, is the police and prosecution side only, not that of the defence.

And perhaps most importantly, none of the evidence from either side was tested in a court under full cross examination and testimony from witnesses because of the premature end of the trial.

If there was a leaker, who?

There are tantalizing clues from both the pre-trial hearings and the newly-released evidence though that raise more questions than provide answers.

For example, on June 4, 2009 in pre-trial hearings, Basi's veteran lawyer Michael Bolton alleged that it seemed possible Bornmann and Kieran's Pilothouse Public Affairs had a cabinet source feeding them information.

And Bolton alleged in court that source may have been Christy Clark.

"Pilothouse internal briefing notes appear to reveal sources in cabinet," Bolton told Justice Elizabeth Bennett, then presiding over the case, referring to Bornmann's lobbying firm. "Bornmann clearly had certain cabinet sources."

"For example, Christy Clark may have been the source within cabinet -- certainly Mr. Bornmann was in contact with Ms. Clark," Bolton said.

Clark also declined to comment on the allegations when contacted at that time, and of course the allegations remain completely unproven. Certainly they were never raised in the actual trial -- because Basi and Virk's surprise guilty pleas ended it after only two witnesses testified, Martyn Brown, Gordon Campbell's former chief of staff and Brian Kenning, a director of BC Rail's board at the time of the sale.

But the newly-released evidence also includes two lengthy police interviews with Gary Collins, in one of which he also appears to suggest someone present at a cabinet meeting about BC Rail may have provided information to Pilothouse.

In the Nov. 3, 2004 interview with several RCMP investigators, including then inspector Kevin deBruyckere -- brother-in-law to then BC Liberal party executive director Kelly Reichert, Collins discusses a document police presented to him -- a seized Pilothouse briefing note to OmniTRAX.

What is stunning is that Collins clearly indicates the briefing note contains a highly detailed report on exact cabinet discussions -- who said what. Collins told the RCMP he couldn't see how either Basi or Virk would have known it.

And there are no records made public to date that show either Basi or Virk attending that or any other cabinet meeting.

The RCMP-Collins transcript

The following are relevant excerpts from that 67-page police interview with Collins.

Sergeant Ian Lawson: "This is a Pilothouse briefing note dated June the 24th 2003 prepared for Gary RENNICK and Fraser McKAY." [OmniTRAX employees]...This briefing note was provided to us by OmniTRAX....

DeBruyckere: "Y'know, the date again now would be after.

Gary Collins: "Yeah, there are..."

Lawson: "May 15."

Collins: "Right. So we have, this is um, okay. I don't, I'm just, I find curious, I mean, the sort of blow by blow of the cabinet meeting I'm trying to remember who would have been in the room.

"I mean, generally s', I mean, certainly um, there would have been Chris TRUMPY, Yvette WELLS, [NOTE: Trumpy was a Deputy Minister of Finance, Wells was a senior bureaucrat who was secretary to the evaluation committee on the B.C. Rail sale] maybe some other people. Um, I don't know who from transportation would've been there. I don't know if cabinet keeps minutes of that, they might know who was in the room at the time but...."

Lawson: "Draw your attention there's a descriptor of uh, we think, referring to the Minister of Transportation at the time-'' [Judith Reid]

Collins: "Mm-hm."

Lawson: "-responded weakly."

Collins: "Mm-hm."

Lawson: "It's a...

Collins: "I don't know who would know that, that's the thing, right? I mean, we don't have a lot of people in the room when cabinet discusses this kind of stuff, right? So, I mean Chris would've been there. Yvette WELLS would've been there that I'm, I'm sure they would have been there.

"Whether rail guys were there or not I don't recall. They might have been. Chris could probably, probably would have better recollection of that than me.

Lawson: "Suppose that's our, our question to you with respect to that document is do you recall, so we understand that that might be in the normal course of-"

Collins: "Mm-hm."

Lawson: "-of your-"

Collins: "Mm-hm."

Lawson: "-your business is giving a brief to Dave BASI at all?"

Collins: "I generally don't do that. Um, y'know, if there's issue up in cabinet that I am part of um, then, y'know, and it has something to do I may say, y'know, 'Here's how it goes we go, we're coming back next time.'

"But, I mean, this is, it reads to me like someone who's more sitting there observing, right? Yeah, you've got now who's more vocal and who isn't.

"Um, y'know, I would not have had that detailed a discussion with Dave at all uh, on sort of that, nor would I've characterized one of my minister's presentations as weak even to a political staff person probably. The um, uh...."

DeBruyckere: "Would Bob, what did, did you ever recall Bob VIRK being in-"

Collins: "He..."

DeBruyckere: "-any of these meetings?"

Collins: "That's, it's possible um, but we, I mean, it's rare that ministers bring political staff into cabinet. Uh, I mean, it's not impossible but I think it's highly unlikely.

"Um, I've never had my political staff at a cabinet meeting and I don't generally have too many staff around me (indecipherable) doin' stuff just 'cause I don't want them and don't need them there. Um-"

Lawson: (Indecipherable)

Collins: "-so, I don't know that."

Lawson: "Yeah, you may have already answered do you find that that is an accurate description of that cabinet meeting?"

Collins: "We had a number on rail. Um, y'know, me not talking or the premier not talking, if I, I mean this looks to me like there is, I mean, there's a briefing, its essentially a briefing right?

"On the 18th and then it's coming back for further discussion and other stuff a', a', on the 23rd according to this, right? Um, so, y'know I got a million things to do. I probably would've been already briefed by Chris on this s', uh, stuff I expect.

"And so, y'know, I could very easily have just completely tuned out and been doing, y'know, workin' through a stack of other stuff which I often do when it's something that I'm not getting much out of, right?

"Um, so I mean, it, it, it's a very possible um, y'know, I'm looking at the players here.

"Jeff is often a strong interventionist in cabinet on issues where he, y'know, he, he's pretty good political too so he sort of gets stuff. He I could see speaking at length on it."

TIELEMAN NOTE: "Jeff" may be Geoff Plant – then-Attorney General.

"Christie would have although she was not a big, big contributor at cabinet. I mean, she doesn't talk, didn't talk as much as you might think given her position. Um, in this case she would have asked though because she used to work for the Minister of Transportation in Ottawa. Um, so-"

TIELEMAN NOTE: "Christie" appears to be Christy Clark, who had worked for federal Liberal Transportation Minister Doug Young in Ottawa.

Lawson: "Mm."

Collins: "-she would have understand. Um, the uh, y'know the federal regulatory process around, y'know, 'cause one of the issues we were discussing was if it's, if it's uh, if CN is the successful bidder what is the regulatory climate um, including labour, right?"

"Um, 'cause now it's regulated under the Federal Labour Act, right? If it's provincial and it's held within BC then it's the BC Labour Code and one of the issues that we were looking at was how do you deal with the what's a, an absolutely ludicrous collective agreement, right?

"So, I could see her playing a bigger role in that meeting uh, based on that um, Jeff would never, y'know, never accuse the Minister of Transportation of providing a one-sided presentation. It's not the way he works."

The interview continues with Collins saying Chris Trumpy reported that CN Rail had been "discouraging or intimidating to possible other bidders", in particular Burlington Northern Santa Fe.

Lawson: "Okay. If you had learned that uh, Dave BASI or Bob VIRK has this information and passed it on to Pilothouse would that be appropriate?"

Collins: "I don't think anybody should give a blow by blow on what happens in cabinet to people outside of cabinet, right? And, y'know, that's just a general principle I don't think that's appropriate.

"I mean, I don't do that. I mean, we have, the only way you can have good knock 'em down and drag 'em outs at cabinet or caucus is if it stays within the room, right?"

No one implicated

None of Collins' statements to police in any way implicate any particular person, nor do they fully explain how Pilothouse obtained such confidential and detailed information.

But they do strongly suggest that neither David Basi nor Bob Virk would have been present or have direct access to the cabinet conversations about BC Rail later found in Pilothouse briefing notes.

The wiretaps released last week also show Basi and Virk gave other confidential government information on the separate privatization of a BC Rail-owned spur line at Roberts Bank -- called the Port Subdivision -- to lobbyist Bruce Clark, Christy's brother.

And the joint Crown and defence "statement of facts" issued at the time of the guilty pleas acknowledges that Bruce Clark, a lobbyist for Washington Marine Group at the time, was found by a police search to be in possession of confidential government documents obtained from Basi and Virk about the spur line privatization, including a draft request for proposals and TD Securities confidential presentation containing an economic evaluation of what BC Rail considered to be the value of the line.

That sale worth up to $70 million was cancelled in March 2004 after police informed then transportation minister Kevin Falcon -- another leadership contender -- that the process was tainted by leaks to a bidder.

Basi-Bruce Clark transcript

The telephone wiretaps show that in a call Oct. 22, 2003 Basi and Bruce Clark discussed how to get the BC Rail Roberts Bank sale draft Request For Proposals information from Basi to Clark, who was in London, England, by courier or fax.

David Basi: "So basically, um, what we have is the draft RFP."

Bruce Clark: "Okay."

Basi: "Um, that uh, we have t' make changes and y'know, uh, um, we can draft it anyway we want now, right: so..."

Clark: "Whose, wh', whose hands is it in?"

Basi: "It's, it's in our hands right now."

Clark: "Okay."

Basi: "Uh, and then it'll go back to transportation. And then they'll look at it and then they'll uh, um, issue the official RFP."

Clark: "Okay. What are the time lines like?"

Basi: "Uh, two weeks."

Basi: "So, I can sit on this thing for two weeks. So if you come back next week then you can take it and look at it, show it to them. They can, they can, y'know, change some of the words around, that's obviously, some buzz words they wanna see in there, right?"

Clark: "Yeah."

Basi: "And these, these companies know how to, how to, y'know, get the fluff out of this shit and how to tailor it to themselves, right?"

Clark: "Of course."

Later in the same call Clark asks if he can get the RFP sooner.

Clark: "Wonder, wonder if it would be better if you got it couriered from here or not?"

Basi: "I don't care. Whatever you want. I don't care."

Clark: "Okay, well maybe I'll get you to courier it to Europe for me, or something."

Basi: "You want me to courier it to Europe?"

Clark: "Sure, you could do that."

But then they decided to fax it instead.

Clark: "Or uh, or, or can it be faxed or something or?"

Basi: "Oh it can be faxed, yeah. Do you wanna give me a fax, secure fax number?"

Clark: "Yeah, I'll get you a secure fax number and we can do it that way."

Basi: "Yeah, you get me a fax number and I'll fax it to you.

Clark: "Sounds great my friend."

Christy Clark has admitted that brother Bruce is part of her leadership team -- but her campaign has not explained his role or responsibilities, nor did they previously respond to 24 Hours/Tyee inquiries about him.

Nor has Bruce Clark made any public statements about why he possessed restricted government documents obtained from Basi and Virk when police searched his home on Dec. 28, 2003.

That information is part of the "statement of facts" agreed to by both the Crown and defence when the guilty pleas were made last October.

Public deserves answers

Basi and Virk received a sentence of two years house arrest for accepting money and other benefits in exchange for giving out secrets.

Bornmann and Kieran, who were both to testify as Crown witnesses, were never charged. Bruce Clark was never charged with any crimes but was also expected to be called as a witness at the trial.

So the secret of how the confidential cabinet conversations came to be in the hands of not only lobbyists but their Denver-based clients OmniTRAX remains just that -- a secret.

For his part, David Basi continues to call for all documents to be released and for a public inquiry to be held, a move that the opposition New Democrats have also demanded.

"I want everything released, all the transcripts of the wiretaps -- not just snippets -- let's get it all out," Basi told me in an exclusive interview Sunday. "I have consistently called for all documents in this case to be released and for a public inquiry, which I will fully cooperate with."

"Christy Clark and all the other B.C. Liberal leadership candidates refuse to hold a public inquiry -- what do they have to hide?" Basi asked. "That speaks for itself."

David Basi pled guilty to serious breach of trust and fraud charges. The wiretap transcripts make clear he and Virk were motivated by greed.

But their guilt does not change the fact that British Columbians will not know what really happened unless a public inquiry takes place.

If you agree, please join my group Basi-Virk Public Inquiry on Facebook.

Bill Tieleman has covered the Basi-Virk case for The Tyee since the B.C. Legislature Raid occurred on Dec. 28, 2003, writing tens of thousands of words here, in 24 Hours newspaper and at his blog on it. He is accredited to report at B.C. Supreme Court and has the documents released last week. .