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Montreal ex-official admits to years of lavish bribes

10/22/2012 05:08 EDT | Updated 12/22/2012 05:12 EST
A former senior engineer for the City of Montreal told Quebec's corruption inquiry on Monday that he received dozens of gifts over the years in exchange for helping to rig the bidding on municipal contracts, and that one of his bribes accepted was a golf trip to the Dominican Republic with the reputed head of Canada's branch of the Sicilian Mafia.

Gilles Surprenant, who was in charge of planning and budgeting for public works contracts, also confirmed that, as far as he knew, construction companies paid a cut of all their city contracts to the Montreal Mob. And he said a further kickback was funnelled to the city's executive committee, the core group of councillors from the ruling party at city hall.

In Surprenant's appearance at the Charbonneau commission on Monday he spoke about the origins of a system of bribes and collusion that tainted city construction contracts for nearly two decades. In the last weeks, the public has heard explosive testimony about bribes, bid-rigging, payoffs to Mafia bosses who stuffed the wads of cash into their socks, and illicit political financing, much of which Surprenant is now corroborating.

The onetime civil servant testified that he met Montreal Mob boss Vito Rizzuto twice over the period he was accepting kickbacks on construction contracts.

The first time, in 1997, he was with a fellow city engineer on a vacation to the Dominican Republic that was organized, and paid for by the late construction boss Tony Conte. Rizzuto showed up with Conte and they all played golf together.

The second encounter was around 2002, also during a golf excursion. Surprenant told the Charbonneau commission that the same foursome played a round at the Mirage Golf Club in Terrebonne, Que., just north of Montreal. Rizzuto made a 75-foot putt on the last hole to win, Surprenant recalled, and earned $25 from each of the city engineers because they had all placed a bet on the game.

Cost of contracts skyrocketed

Last week, the engineer told the corruption inquiry that he accepted about $600,000 in bribes starting in 1991 in exchange for funnelling extra money to construction companies via the city projects they worked on. On Monday, he delved into how he and other bureaucrats got wrapped up in that system of graft.

As early as 1995, contractors had met with Surprenant to complain that the value of contracts in Montreal was too low and that companies were losing money because there was no profit margin.

"They were taking shortcuts, they were going bankrupt, they were constantly asking for extras," Surprenant said.

Asked if he therefore started artificially inflating contracts even in the mid-1990s, Surprenant said it was possible. Earlier, he'd mentioned that anxiety medication had caused certain memory lapses.

In any case, between 1995 and 2000, Surprenant estimated, he received a kickback on one contract a year

But by 2000, the cost of public works contracts in Montreal exploded by as much as 25 per cent, finally coming to a plateau in the 30 to 35 per cent range by the mid-2000s.

Surprenant said his role was to manipulate a computer system that evaluated the cost of projects to ensure the price of contracts met what entrepreneurs wanted to pay. He would receive a call from a construction company chosen by the cartel of firms that rigged the bidding on city contracts one week before telling him the amount, and he would find a way to justify the costs.

Trips to Cuba and Mexico

Surprenant said a handful of city employees partook in the scheme, and they got money and gifts in exchange for helping fixed contracts go through.

His treats included golfing trips to the Dominican Republic, Cuba and Mexico, some paid by construction bosses, as well as more golf at home, fancy dinners, bottles of wine, hockey and concert tickets. Inquiry investigators have identified at least 90 contracts where Surprenant took a cash cut, the kickbacks becoming rampant around 2000.

Surprenant's testimony corroborates accusations by the inquiry's previous witness, former construction boss Lino Zambito. Surprenant said Monday that he was made aware that construction companies paid a 2.5 per cent share of the value of their city contracts to the Montreal Mafia — which Zambito alleged — and that another three per cent went to the city's executive committee.

Zambito testified that the three per cent went to Union Montreal, the political party of Mayor Gérald Tremblay, an allegation the mayor vehemently denies.

Surprenant also said he'd heard of the so-called TPS — the French initials for the GST, which in this case stood for "taxe pour Surprenant," or "tax for Surprenant." But he denied it was true, calling it the invention of colluding construction moguls.

"I don't know where it came from. It's something the construction bosses came up with and they decided among themselves that one per cent went to me," Surprenant said.

Surprenant said he collected several thousand dollars on rigged contracts, but never came close to collecting one per cent of the amount.

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