POLITICS

Suspended senator Mike Duffy's bank accounts, income taxes exposed at trial

06/16/2015 04:00 EDT | Updated 06/15/2016 05:59 EDT
OTTAWA - The mortgages, Senate salary, private side business and the famous $90,000 repayment from Nigel Wright — Sen. Mike Duffy's financial history was laid out for all to see at his trial Tuesday.

Government forensic accountant Mark Grenon's testimony on his analysis of Duffy's financial data trail won't necessarily be accepted as fact. Ontario Justice Charles Vaillancourt has yet to decide on that point.

But Crown prosecutors appear to be using the dizzying array of numbers to paint a picture of a high-flying senator who was perpetually living on the edge — a senator who perhaps had a compelling reason to pad his income and to extort the prime minister's chief of staff into covering a $90,000 reimbursement of his contested expense claims.

Duffy has pleaded not guilty to 31 charges of fraud, breach of trust and bribery related to his Senate living, travel and office expenses.

The court was shown slide after slide of balance sheets and pie charts, chronicling Duffy's financial life from late 2008 to mid-2013.

In that time period, $1.2 million got deposited into his bank account. In addition to his Senate salary, Duffy received a pension from CTV and from the government. He also made $25,000 doing speaking engagements through his side company.

The sale of his late mother's home netted approximately $50,000.

Still, the available records showed that money was flowing out faster than it was coming in, with a line of credit that crept up steadily to over $100,000 at one point in 2012. Duffy's Ottawa-area home is heavily mortgaged. His vehicle is leased.

"There was a continued amount of overspending in the account that had to be funded with some sort of money. That money was the line of credit," Grenon said.

Grenon revealed that the agency that follows potential money laundering and terrorist activity, Fintrac, raised the alarm at one point that Duffy's line of credit had risen to more than $100,000. It's not clear when that discovery was made.

Duffy's defence lawyer Donald Bayne argued that Grenon's testimony should not be entered into evidence, that it amounted to innuendo and was irrelevant to the charges at hand.

"You just let their dump truck back up to your courtroom and dump thousands and thousands of records ... and just leave it hanging there like a Sword of Damocles for the rest of the file," Bayne said.

"For what purpose? Is Sen. Duffy in his defence then going to have to account for 5,500 transactions over his financial life? It will distort this trial."

Duffy's team can be expected to raise the point that after he became a senator, he spent somewhere around $100,000 renovating his cottage in Prince Edward Island to make it a four-season home.

And that line of credit with the Royal Bank has come up before in the life of the Senate scandal.

In October 2013, when Duffy was about to be suspended from the Senate, he told the upper chamber that the Prime Minister's Office suggested using his debt as a cover for the $90,000 he received from Wright.

"When they heard that I had been using a line of credit to renovate my home in Cavendish, they jumped right on it," Duffy said.

"It was suggested I go to the RBC, borrow the cash to pay off that line of credit, and then, when the media asked, 'Where did you get the money to pay the $90,000?' the PMO told me to say, 'My wife and I took out a loan at the Royal Bank."'

Duffy said at the time he did take out a loan, but it wasn't to repay the $90,000.

"That line was written by the PMO to deceive Canadians as to the real source of the $90,000."