Tuesday, December 27, 2011

Basi-Virk 8th Anniversary - a different view of BC Legislature Raid - how to hide the obvious in making BC Rail disappear

The obvious part - David Basi & Bob Virk after surprise guilty plea - October 18, 2010 - Bill Tieleman photo

How BC Rail Was Made to Disappear


Eight years later, looking back at the BC legislature raid, and where we've arrived.

Bill Tieleman's The Tyee column
Tuesday December 27, 2011
NOTE: 24 hours Vancouver newspaper is not publishing daily this week - back January 3, 2012
"No question is so difficult to answer as that to which the answer is obvious."

George Bernard Shaw

What happened when an unprecedented police raid on British Columbia's legislature took place eight years ago Wednesday?

How did the BC Liberal government's $1 billion privatization of BC Rail spark the province's biggest political scandal in decades?

Why did the ministerial aides to then finance minister Gary Collins and then transportation minister Judith Reid -- David Basi and Bob Virk -- defend themselves against charges of breach of trust and fraud for six years only to make a surprise guilty plea bargain when their trial had heard just two of a likely 40 witnesses?

Who knew what and when?

And when, if ever, will we find the answers to these questions?

Through a public inquiry repeatedly rejected by Premier Christy Clark but promised by New Democrat leader Adrian Dix, should he form the next government?

Perhaps some of those answers are already obvious.

One clue requires us to travel back in time and space to Princeton University in September 1969.

An ancient American Revolutionary War cannon, partially buried in the Princeton grounds and anchored with cement, disappeared overnight.

The only trace of the extremely heavy cannon's former hallowed location was a giant mound of earth left when the suspected perpetrators -- Rutgers University students who had left graffiti insulting Princeton behind -- had somehow silently removed the artillery piece in the dead of night.

It was a total mystery how this stunning feat of theft done with astonishing speed and impressive logistics could have been accomplished.

But the secret was eventually solved when Princeton's student newspaper got a tip that led to the dirt on the crime -- look underneath the pile of earth!

The cannon had never moved an inch, nor been disinterred from its resting place.

Instead the brilliant plotters correctly predicted that no one would think the cannon was exactly where it always sat -- and that the mountain of dirt it was buried in would convince all observers that an amazing criminal act had taken place.

What's more -- it wasn't Rutgers students who did the dirty deed -- it was a group of Princeton seniors who covered their tracks by leaving behind slurs on their own school, knowing that the 100 years of university rivalry would enrage Princeton.

So a missing cannon is exactly where it always was and perpetrators of the perfect crime turn out not to be whom everyone presumed.

That analogy may help explain the mystery of BC Rail's disappearance and how it happened right in front of our eyes.

Campbell's vow to sell

Let's go back to basics.

Then-premier Gordon Campbell narrowly lost the 1996 election to NDP Premier Glen Clark in part because the BC Liberals promised to sell BC Rail.

That means a clear intent was formed to privatize a Crown Corporation that had net income in 18 of the 21 years before it was put on the block.

During the 2001 election campaign, Campbell learned his lesson -- promising the reverse of his 1996 pledge -- this time he would not sell BC Rail.

But after eviscerating the hapless NDP under then-premier Ujjal Dosanjh and commanding a 77-2 seat margin in the B.C. legislature, Campbell secretly went back to his original plan -- get rid of BC Rail.

Campbell put the railway company on the auction block and invited bidders to make their best offer in a competitive process -- may the highest price win.

Unfortunately, some bidders were more equal than others.

During the process it was discovered and reported that CN Rail had been wrongly given confidential BC Rail operating information.

Due apologies were made and the bidding continued.

But major rail companies were increasingly uneasy about the whole situation.
CP Rail dropped out of the bidding a week before the announcement that CN had won, saying in a letter to Campbell's senior deputy minister Ken Dobell that the process was "unfair".

The Nov. 17, 2003 letter from the CPR vice-president of strategy and law, Marcella Szel, to Dobell says that its "market intelligence" showed "that CN was speaking directly to BC Rail shippers about their bid, with what we must consider the approval of the [BC Rail] Evaluation Committee, since the confidentiality agreement clearly stated no such discussions were to be held without consent."

"This feedback included the marketplace being aware of the actual value of the bids," Szel wrote to Dobell, just eight days before the B.C. government announced the sale of BC Rail to CN.

Anger by bidders at process

That letter was part of 8,000 pages of documents ordered released in early 2009 by then-B.C. Supreme Court justice Elizabeth Bennett in response to a court application filed on behalf of New Democratic Party MLA Leonard Krog.

Another major rail company -- Burlington Northern Santa Fe Railway -- also dropped out before the bidding ended, writing in a letter also disclosed in 2009 that it was "extremely dismayed with the handling of the BC Rail Transaction.... because of the lack of fairness in which the process has been conducted."

The letter went to CIBC World Markets, which handled the BC Rail sale for the province.
BSNF had been a business partner supporting the bid of OmniTRAX, which ended up being the only other bidder left competing with CN.

In an earlier letter to Wallace dated Nov. 18, 2003, Rickershauser blasted CIBC World Markets with both barrels:

"I and Burlington Northern Santa Fe Railway are extremely dismayed with the handling of the BC Rail Transaction, especially in recent weeks as managed by CIBC World Markets. Our dismay arises because of the lack of fairness in which the process has been conducted so far, the apparent favoritism of certain bidders, and the lack of timely information provided to all participants involved in the process," Rickershauser wrote.

"Reports and rumours of CN talking directly with BC Rail shippers and communities have been circulating for several weeks in shipper, government and media circles.... In fact, reports from shippers indicate that CN has been discussing what it will or will not do when it is awarded the BC Rail concession," Rickershauser ended.

We cannot determine the accuracy of either CP or BNSF's allegations of a tainted process that unfairly favoured CN Rail.

It is also worth noting that none of the huge railway companies that bailed out ever went to court to recover their costs in participating in the bidding, let alone filed legal action to have the process overturned because of that alleged unfairness.

Why not? CP Rail's Szel pretty much answers that question in her own bitter letter.

Szel wrote that she would like to: "discuss with you how the British Columbia government can re-establish this kind of confidence with the CPR."

In other words, there's still far too much business to be done in B.C. to pursue a scorched earth approach. No doubt BNSF felt the same way, despite its anger.

David McLean and CN's win

There was also a "fairness" advisor interim report by Charles River Associates into the bidding stating that: "the Province and its advisors designed and managed the BC Rail restructuring process in a manner consistent in all material respects with current best practices usually followed in similar transactions.

But still -- two reputable international railway companies dropped out of a bidding process because both felt it was designed to favour CN Rail.

Who was and remains the chair of CN Rail?

David McLean, one of Gordon Campbell's biggest and most long-standing supporters.

And CN Rail was one of the BC Liberal Party's most significant donors, contributing $113,000 between 1994 and 2004, and another $155,000 between 2005 and 2009.

Campbell's then-chief of staff Martyn Brown testified as the first witness in the Basi-Virk trial that he was unaware of CN donations to the party and that neither that nor McLean's role as Campbell's chief fundraiser in 1996 affected the sale.

"It was not at all a factor in the consideration," Brown swore in May 2010.

And with only complaints by competing companies but not any action, and with only allegations by lawyers for Basi and Virk under the protection of a court pre-trial hearing, that's the end of the matter.

Basi and Virk avoid jail

The defence for Basi and Virk made many bombshell claims in B.C. Supreme Court, allegations that if ever proven would have rocked the province and likely brought down the BC Liberal government.

But they weren't.

Basi and Virk's lawyers were negotiating hard in secret with Special Prosecutor Bill Berardino to make a guilty plea bargain deal for their clients.

In October 2010, that deal was done. Basi and Virk would spend two years on probation and not have to pay back any of the roughly $6 million in legal fees collected over the years by their lawyers Michael Bolton and Kevin McCullough. Nor would they spend any time in jail, as prosecutors originally demanded.

The deal meant no more testimony as planned from BC Liberal government insiders -- from ex-cabinet ministers like Christy Clark and Gary Collins -- or from a series of party operatives like Patrick Kinsella, the lobbyist who collected $297,000 as an advisor to BC Rail over four years, doing work that was unknown even to some of its senior executives.

Basi and Virk admit passing confidential government BC Rail bidding information on to Erik Bornmann and Brian Kieran --lobbyists representing OmniTRAX -- and justice is done.

What's that shape under the dirt?

So, let's go back to our missing cannon at Princeton University in 1969.

Just like the artillery piece hiding under a mountain of dirt, the B.C. Legislature Raid case is actually right where it always was.

Premier Gordon Campbell's government broke an election promise and sold BC Rail to one of his political party's biggest backers -- CN Rail -- in a competition where all but one other bidder dropped out, citing an unfair process they believed favoured CN.

The last remaining bidder, OmniTRAX, lost despite whatever advantages its lobbyists managed to procure from Basi and Virk in exchange for about $30,000 and a trip to Denver, Colorado for a football game.

And despite much of the BC Rail case being known to those voters who cared to look, the BC Liberals were twice re-elected to government after the 2003 raid, in 2005 and again in 2009.

It's that simple, unless you actually want to know everything that really happened.

That will still take a public inquiry -- you can support that position at a Facebook page I set up calledBasi-Virk Public Inquiry

.

30 comments:

Anonymous said...

This is still the single biggest issue for me. The NDP better come out with a full inquiry because the sting and stench of BC Rail is never going away until we've had a full public airing of the entire episode.

Anonymous said...

The problems in this province (and this country) are not unsolvable or complex.

The real issue we face - primarily and fundamentally - is a corporate owned media.

Good article Bill!

RonS said...

Right on the mark Bill. There was still the raid and what about the drugs that was responsible for the raid? That's still there as well. What about that?

Ron1 said...

A very helpful summary - and analogy - Bill.

DPL said...

The sleazy bunch are still running the province but if things hold as they are , next time around the BC Liberals won't be running anything.The NDP will have a public inquiry and it won't come a minute too soon. Gordo is long gone, to London to ( don't gag)represent us all.

North Van's Grumps said...

Railway donations to BC Liberal Party

Total Contribution For This Search: $189,560.00 Canadian National Railway to BC Liberal Party up to January 17, 2011
DAVID MCLEAN

Total Contribution For This Search: $56,645.00 Canadian Pacific Railway to BC Liberal Party up to May 10 2010
JOHN LYNCH PAUL CLARK

Total Contribution For This Search: $7,526.75 BNSF RAILWAY COMPANY to BC Liberal Party up to March 12 2010

=================================
Total Contribution For This Search: $9,750.00 SOUTHERN RAILWAY OF BRITISH COLUMBIA LTD. to BC Liberal Party up to May 29 2009

Anonymous said...

The fact the MSM REFUSES to ask the questions we want answered speaks to a bias i shudder to think about.

Further, the fact Tsakumis has not been sued when this is clearly affecting the polls....speaks volumes

cfvua said...

Ditto. Full blown, wide open, look at everything. Then punish the guilty on both sides of the collaboration on the heist.

Anonymous said...

Through a public inquiry repeatedly rejected by Premier Christy Clark but promised by New Democrat leader Adrian Dix, should he form the next government?

I followed the link and read through the material, but could not find a "promise" from Adrian Dix. Is there something somewhere, anywhere, that states the NDP will conduct a full public inquirey into the sordid mess that is the BC Rail scandal - and not just the $6 million plea deal - should they form government?

Keith said...

Hi Bill,

Many thanks ( along with the other bloggers) for keeping this front and centre and not letting it die a death, which would be the first choice of the liberals and their lamestream media gofers.

An inquiry must be held, the questions I would have about it would be;

What would be the terms of reference?

Will it be a full inquiry no matter where it leads and to whom, with everything on the table.?

Can we be assured that the local juduiciary will be fair and impartial,? my preference would be someone from another juridstiction.

Will there be legal consequences if there are grounds, both civil, criminal.?

The problem with inquiries that we have all seen in the past is a lot of time and money is spent, with no consequences except for the predictable standard result, "we have learned from this and won't make the same mistake again blah blah blah."

Bill Tieleman said...

To Anon 9:32 pm Dec 27 - Here's what I read and how I understand it from the link to the NDP I provided:

"Christy Clark continues to refuse to support growing calls for a public inquiry into the B.C. Rail corruption scandal. British Columbians have every right to wonder why she doesn't want the public to get to the bottom of B.C. Rail.

...... New Democrats are calling on Christy Clark to call an inquiry that looks into the $6 million taxpayer funded bail-out of the B.C. Liberal insiders convicted of corruption, so British Columbians can get the answers they deserve."

There are numerous others similar statements - is there some reason you don't believe an inquiry would be held under the NDP, despite these repeated calls for one?

Help us out here.

Anonymous said...

DPL wrote:

"next time around the BC Liberals won't be running anything."

...true - except their puppet masters will still be there. The msm is not going to suddenly be onside with social democracy - expect more "deck parties" with ctv and the rcmp.

Solutions?

One - people like Bill!

Anonymous said...

you missed the nail in the coffin of the rail scandal. the boxes of evidence became invisible,when miz clarke signed on for 20 more years paramilitary policing. [the rcmp contract].

BC Mary said...

Hi Bill,

Your Tyee column today is terrific. Nice analogy too, the Princeton dirt-pile ... it stays in the imagination.

I wanted to leave a comment on Tyee but couldn't get on (what a nerve! - I've been a member for 6 years and 39 weeks!). But wanted you to know how welcome your comments are ... for those of us who worry about the BC Rail story going stale.

One aspect I'd like to see you explore ... I've heard it said that any agreement reached by fraudulent means then itself becomes null and void. It makes sense to me!

Also: There are clauses, in all agreements (even including the BCR-CN agreement) which specify certain actions or conditions under which the deal becomes untenable, and ownership is revoked. In this case, with BC Rail the tentative ownership would lapse and be re-possessed by the BC government under certain circumstances. As I recall (from memory) reasons for breaking the deal between BCRail and CN included CN failure to maintain certain rail-lines; or if CN fails to buy the promised 600 rail-cars, etc. And it's my understanding that both those sins had been committed by CN ... which is why I tried to institute a "Show Us The Deal" campaign for July 14, 2009 (5th anniversary of the deal, designated for review).

Q. Why would the Campbell / Christy-Clark governments shrink from that question? Seems to me it would be a win-win for BC if, as a result of a Public Inquiry, the BCR-CN deal is shown and proven to be corrupted. I'd love to see your analysis of this.

I'll try to post this on your Tyee review, if I can access it now. Happy New Year!

Mary.

.

Anonymous said...

Through a public inquiry repeatedly rejected by Premier Christy Clark but promised by New Democrat leader Adrian Dix, should he form the next government?


does not say specifically in that link to Adrian Dix that the NDP would call an inquiry.

Might be good to do just that, but a good bet is that such an inquiry would not appease everyone who wanted it. If the scope of the inquiry does not include what Bill and this "BC Mary" character wants, what then?

BC Mary is also forgetting a fundamental about railways. The railway can buy railcars, but they are spread out where they are needed, and not where they are wanted. The railways buy rolling stock quite regularly to replace old equipment.

BC Mary should cite evidence as to where CN has not bought the "required" 600 rail cars. CN has an obligation to maintain service levels on its trackage as required by Transport Canada and other regulatory agencies.

As for the Tyee, I wouldn't bother with them. Bill is better than they are. The Tyee has evolved in a left wing readers only propaganda rag for left wing lost causes. Used to be good and balanced alternative, but not any more.

BC Mary. another B.C fine whine.

DPL said...

The Tyee isn't taking comments right now.
see the note on their page.
Tyee's Comments Go on Holiday

But we'll keep posting stories right into the new year. Oh, and here's what you liked in 2011.

By David Beers

Anonymous said...

Intimations are not promises in my mind. Nice thing about being the opposition. I certainly hope the NDP will make the needed promise during the campain.

Anonymous said...

How many more social democrats will get cancer in the next 5 years?

2009 Dilma Rousseff, president of Brazil (lymphoma)
2010 Fernando Lugo, president of Paraguay (lymphoma)
2011 Hugo Chavez, president of Venezuela (cancer in a sensitive area down there)
2011 Lula da Silva, president of Brazil until end of 2010 (throat cancer)
2011 Cristina Fernandez, president of Argentina (thyroid cancer)

Jack Layton

ron wilton said...

When I attended the provincial NDP leadership meeting in Kelowna last spring/summer(?), Adrian Dix and every other candidate clearly stated on film and on tape that they woul have an intensive and comprehensive inquiry into the BC Rail affair as well as saying an emphatic NO to the Enbridge pipeline, BC Hydro privatization and site C dam.

Incidentally anon @ 1:14, your disparaging remarks vis a vis BC Mary are cowardly and ignorant and not worthy of being in the same company as the other positive commenters.
Since when is being a 'lefty' considered a pejorative? If fighting for truth and honesty in government and the press makes us 'lefty', and you think that is a negative, then I would suggest you have some pretty serious personal issues besides not having the balls to identify yourself.

Anonymous said...

"When I attended the provincial NDP leadership meeting in Kelowna last spring/summer(?)
Adrian Dix and every other candidate clearly stated on film and on tape that they woul have an intensive and comprehensive inquiry into the BC Rail affair as well as saying an emphatic NO to the Enbridge pipeline, BC Hydro privatization and site C dam."

Sure, spend money on an inquiry that will make money for the lawyers, and not money on a much needed power project that would make a lot of construction jobs.


"Incidentally anon @ 1:14, your disparaging remarks vis a vis BC Mary are cowardly and ignorant and not worthy of being in the same company as the other positive commenters."

There hasn't been any positive commentators in regards to BC politics here. There have been many times where ignoramuses have labelled both BC and Canada as dictatorships (but magically this label doesn't apply to left wing governments such as the HST loving one in Nova Scotia.

"BC Mary" is just an identifier label in much the same way that Anonymous is.

"Since when is being a 'lefty' considered a pejorative?"

Since when is being right wing considered to be a pejorative?



If fighting for truth and honesty in government and the press makes us 'lefty', and you think that is a negative, then I would suggest you have some pretty serious personal issues besides not having the balls to identify yourself.

Past NDP governments in B.C. have never been even close to starting to be honest and truthful. In fact even the NDP MLAs against Carol James last year hid behind their own hands and never stated publicly
as to why they decided to go against their own leader.

Anyone who uses Anonymous is identifying themselves.

If BC Mary is making up facts such as the 600 rail cars required for that BC Rail section of CN, then fact it up with a linked resource.

Happy New Year to you too.

and don't take this seriously. This is only a blog. It's not Centre for Policy Alternatives policy research material.

Anonymous said...

Don't feed the troll

Anonymous said...

Can see the reasons for a Basi Virk $6 million payout inquiry, but a full scope inquiry into BC Rail isn't needed.

Both Tieleman and Tsakumis have covered everything. If you blend the two together (removing the political rhetoric from their respective blog groupies), you'll have 95% of what would be covered by an inquiry, and it was all free.

Add in the current-events-articles glued-into-a-scrapbook-for-school type project that BC Mary did on news articles about the BC Rail fiasco, and that covers an additional 1.5 to 2%.

So why spend taxpayers money on an expensive inquiry when that money is better suited to education and health care? Or is that blog groupies here want the NDP to waste taxpayer dollars on an inquiry and not provide such funds to education and health care. Bet that's it. Has to be.

A New Year and new things to blog about boys and girls. Let's see what's ahead and not fret about the road kill that what was 4 km back down the road.

DPL said...

anon 4.41 seems to believe the give away of our railway should be considered a thing of the past. Well many of us think otherwise. Gordo lied about trying to sell it, then did sell it. The Liberals lied about how it was a money loser, when it wasn't. a bunch of big time BC Liberals were about to give evidence under oath and as Bill mentions Poof it's gone. That wasn't Liberal money or Liberal railway, it was ours and yes we do need an inquiry and the sooner the better.

Anonymous said...

Someone is freting possibly sweating about an inquiry...

Personally I sort of agree - an inquiry is not enough. I want charges laid on the people responsible for robbing British Columbians.

Anonymous said...

President of B.C. Liberal Party awarded Queen's counsel designation
Rob Shaw, The Victoria Times Colonist

"Premier Christy Clark's government has awarded the prestigious Queen's counsel designation to the president of the B.C. Liberal Party, Sharon White. [...]

But the government-provided biography did not mention any of White's ties to the Liberal party or the premier's office.

White was also named a member of Clark's transition team until the premier was sworn in in March. White was acclaimed as party president in May. She is responsible for overseeing party organization, membership and fundraising.

Clark also named White as co-chairwoman of the Liberal party's election readiness committee."

---

In case you're wondering... ya, the judge (Chief Justice of British Columbia) that thought Gordon Campbell was eligible for the Order of BC had to approve this steaming pile of doo too. - Queen's Counsel Act

---

Criteria for Candidates

Candidates must:

1. Belong to the B.C. bar and have been members for at least five years.
2. Demonstrate professional integrity, good character and excellence in the practice of law. Such excellence could be determined by any of the following conditions:
- They are acknowledged by their peers as leading counsel or exceptionally gifted practitioners.
- They have demonstrated exceptional qualities of leadership in the profession, including in the conduct of the affairs of the Canadian Bar Association, the Law Society of British Columbia and other legal organizations.
- They have done outstanding work in the fields of legal education or legal scholarship.

Anonymous said...

"anon 4.41 seems to believe the give away of our railway should be considered a thing of the past."

It's now been 8 years since the Raid on the Legislature.


"Well many of us think otherwise. Gordo lied about trying to sell it, then did sell it. "

He in fact did. It was in 1996 that he said he would, 2000 that he said he wouldn't any by 2003, he did.

Glen lied about his budget and the Fast Ferries. Chretien lied about many things and do did Brian Baloney.

"The Liberals lied about how it was a money loser, when it wasn't. a bunch of big time BC Liberals were about to give evidence under oath and as Bill mentions Poof it's gone. That wasn't Liberal money or Liberal railway, it was ours and yes we do need an inquiry and the sooner the better."

Inquiries cost alot of money. WHat would the terms of reference be? It certainly would not be what is agreed to by anyone in this blog.

Trouble, you get an inquiry, but the scope is something that a few fanatics here would loudly wail against,because it does not contain what they want or is presided by a person the Bill Bloggers hate (is there anyone who is not NDP in politics or a judge they like?) and guess what? The complainin' continues.

That's why a wise anon said, time to move on. It's a new year.

Anonymous said...

Anon 6:45:00 PM PST said, "That's why a wise anon said, time to move on. It's a new year."

Why do we want an inquiry? Because we want to see justice been served and the guilty pay for their crimes.

By the way you tried it with Glen Clark and he was found not guilty. Now it is time (actually it is well past) time to try the BC Liberals for their crimes.

ron wilton said...

"Move along folks. Nothing to see here."

Gosh! Where was it that we heard that line so many times before?

Oh, now I remember,

First it was Pinochio, then it was MacLean, then it was Coleman, then it was Hansen, then it was DeJong, then it was Polak, then it was Falcon, then it was Les, then it was Berardino, then it was McKenzie, then it was McRae, then it was Bond, then it was Thornwaite, then it was Chong,then it was Barisoff, then it was Heed, then it was Baldry, then it was Palmer, then it was Smyth,then it was Clark, Clark and more Clark.

Funny thing about human nature; the more others tell us to 'move along', the more likely we are to stick around and try to find out why 'others' are so eager to have us 'move along'.

Anonymous said...

Lots of ananoymous comments here. The real issue, is one of a serving governments criminal intent, and blatant disregard for our democracy. Wake up people! For one its your money, not the BC Liberals, whether for payouts of the criminally convicted legal fees, or a tax debacle that showed that grass roots politcal decisions can and will be made, in this province and country.
Our so called educated, elitist politico's are not motivated, "collectivly" for the voters, but for themselves and specific intrests, in this country. The system is broken and needs some serious overhauling.
As for the BC Liberals and BC Rail, start lining up some jail cells, it will be the only way, the average person in this province, will accept that justice has been done. You BC Liberals are not above the Law!

Anonymous said...

http://www.timescolonist.com/sports/Hockey+rioters+Rail+scandal/5963822/story.html