OGGO Committee Meeting
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CANADA
Standing Committee on Government Operations and Estimates
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EVIDENCE
Wednesday, May 26, 2010
[Recorded by Electronic Apparatus]
[English]
Ladies and gentlemen, the clock says a little after 3:30, so could we all take our seats, please.
The committee is continuing its study on renewable energy projects, and we have before us as a witness, for one hour, Mr. Jim Wright, of Wright Tech Systems.
Mr. Wright, I understand you have an opening statement for five minutes.
Madam Chair, thank you. I thank the committee for inviting me to this session.
I am Jim Wright, chairman and sole shareholder of Wright Tech Systems Inc., and a partner in Green Rite Solutions Inc., a marketing and funding partner that assists Wright Tech Systems Inc. Both companies are based in Richmond Hill, Ontario, in the greater Toronto area. During my time with you, I will attempt to describe my involvement with Nazim Gillani, Rahim Jaffer, and Helena Guergis.
Background about me, Wright Tech Systems, and Green Rite Solutions: I am a proud Canadian from Northern Ireland, as you can hear by the accent, and happy to say I've been here for 53 years. I would describe myself as an inventor and an entrepreneur. I have always been interested in waste management, and specifically its effects on the environment. To that end, since the mid-1970s I have been working to put my ideas into workable business solutions for municipal waste management. Over the last five years Wright Tech Systems has focused on developing waste management solutions for a number of institutions, businesses, and municipalities. We have a patented technology that converts organic waste into green energy. Our technology is called a biodryer. It's a biological dryer. We can provide turnkey waste management solutions for municipal projects of 50 to over 1,000 tonnes per day. We design, engineer, procure, manufacture, and supply equipment. We also construct, operate, and finance these projects. Every project is unique. We employ waste, energy, and environmental specialists; design engineers; project managers; facility operators; and financial advisers. Wright can provide the necessary municipal solid waste separation for non-hazardous discarded material generated in residential, commercial, institutional, and light industrial settings. The systems include sorting, separation, biofiltration, and conveying equipment. We can provide a complete waste processing solution, and it works.
Wright has systems in various locations, including Disney World in Florida, Whistler, the site of the Vancouver Olympics, and in Ireland. Many people with interest in green projects can and do speak with us about our systems. Capital funding meetings and institutional marketing efforts have brought us into contact with diverse financial interests over the years. My purpose in providing this description is to explain how, in the normal course of business, Green Rite Solutions and Wright Tech Systems might come to the attention of financiers or venture capitalists of various sorts.
About Nazim Gillani, Rahim Jaffer, and Helena Guergis: I have been asked many questions by the media and issued a statement on April 23, 2010. Mr Gillani first came to the attention of Green Rite Solutions Inc. in the course of promoting our biodryer technology as I described above. Meetings were arranged with Mr. Gillani, and two of these meetings were at my Richmond Hill boardroom specifically to assess potential financial opportunities. As it appeared to us that there were no mutual future prospects, we terminated further meetings with Mr. Gillani.
Mr. Jaffer was introduced to Green Rite Solutions by Mr. Gillani's cousin at a luncheon meeting chaired by Gillani at La Castile Steak House. Mr. Jaffer was considered to be a potential source for locating government funding. This was the only time I saw Mr. Gillani and Mr. Jaffer together. Mr. Jaffer did indicate that there were potentially green funds from which moneys might be available once we had obtained contracts from municipalities and that he and Mr. Glémaud, his partner, would possibly assist with the application for these. It became clear to us that all efforts to arrange for any actual government funding would be our corporate responsibility, and therefore there was no benefit to continue work with Mr. Jaffer or his partner, Mr. Glémaud. In my opinion, although Mr. Jaffer appeared to have acted in good faith, it did become clear that he brought little substance to the discussions. Lobby efforts were never discussed. Mr. Jaffer never stated that he had government funding for us. We terminated further meetings with both Mr. Jaffer and Mr. Glémaud. Some months later Mr. Jaffer and Mr. Glémaud were on their way to China and asked if they could represent our technology in China, but nothing came of it.
I am unaware of Mr. Jaffer's alleged subsequent promotion of Green Rite Solutions opportunities in Canada. Although I did eventually get a copy of a GPG document, anything I learned, I read in the papers.
The summary sheet that was sent by Green Power Generation and evidenced in a previous parliamentary hearing was probably an internal communication from GPG. In my opinion, it was likely planned for their use to ascertain investor interest in Green Rite Solutions. Neither Wright Tech Systems nor Green Rite Solutions was involved in the creation of the said document beyond providing data about the Canadian market potential of its systems.
In any case, all these meetings were fact-finding discussions to ascertain potential financial opportunities. Discussions like these happen all the time with other parties, and like those discussions, nothing came from them. No agreements or contracts were ever established. Neither Mr. Jaffer nor Mr. Glémaud has or had any financial interest in either of the companies. There were no payments of any kind made between the companies, Mr. Gillani, Mr. Jaffer, Mr. Glémaud, or their companies. We never discussed lobbying efforts of any sort.
During my initial meeting with Mr. Jaffer, he indicated that his wife, Helena Guergis, was the federal member of Parliament for Simcoe--Grey, Ontario. I happen to own property in this riding. I asked Mr. Jaffer if his wife could introduce my technology to local politicians, as one might ask of anyone's MP. For me, achieving local government awareness is always difficult. I also asked Mr. Jaffer if he was aware of the landfill project at Site 41. He said that he was not, but that his wife would be aware of it. Beyond that, Mr. Jaffer and I never discussed the Site 41 issue again.
The outcome was that Mr. Jaffer offered Ms. Guergis's office number. I contacted her through her assistant. Ms. Guergis provided me with an introduction letter to the local warden referring to the Site 41 project and the waste management issue. To my knowledge, her letter never led to anything. For this record, I can state that Ms. Guergis, like the others, had no financial interest in Green Rite Solutions or Wright Tech Systems, past or present.
Thank you for this opportunity to set the record straight.
Thank you.
We will go to the first round of questions. Ms. Siobhan Coady will be questioning you for eight minutes, which will include the questions and answers.
Ms. Coady.
Thank you very much.
Thank you for appearing before this committee.
I am also a business person in a novel technology. I was in biotechnology, so I understand some of what you've been through in developing novel technologies.
Mr. Wright, you said that you had a meeting with Rahim Jaffer. What were your expectations? What were you expecting Mr. Jaffer to do for your company?
At the time, we had heard that there were green funds. We never have any success with government—never did. That's the way it goes. In years and years of business, it just doesn't work for me. I couldn't get anyone to talk to me anywhere in government. He was a government guy. When I met him at the steak house, he sat right beside me.
When he came to the meeting, I didn't know who he was. He came and was introduced to me. What he said to me was that he had been a member of Parliament for 12 years for Edmonton, that he was no longer an MP, having lost the last election, but he had a green company looking for green initiatives, green technologies. Remember, he was introduced to me by Gillani. I said fine, and we talked a bit willy-nilly.
Actually, I didn't know his wife at the time. We talked over lunch. I thought his wife actually was from Edmonton. I didn't know she was from where I had my cottage. He said, “No, my wife is from Simcoe”. That's when I said, “I wonder would she help me to reach politicians, because I can't get anybody's attention”. Site 41, I don't know if you're aware of it, has been an ongoing battle for the people up there, and finally yesterday the vote was unanimous to close it and never do it again, ever. But that hadn't occurred at that time. That was back in July.
So you actually live in your cottage on occasion.
So this was just a chance meeting between you and Mr. Jaffer, you had a quick conversation, and there wasn't what you would consider a business relationship. He was not representing you, except for the trip to China, and then—
I'm sorry, it was my understanding that he was introduced to Gillani at that meeting also, by Gillani's cousin. I think it was the first time they'd met, and I think the meeting was more for them to understand themselves better, between those two, because we were sort of shuffled out at lunch and another group of guys came in, so we didn't stay around very long. We had a lunch and talked about green initiatives, green projects, this energy thing, green energy, which I do. I described to him what I do.
Sure.
I find it interesting, and I'd like your perspective on it, that on September 3, which is a week or so after you had this chance meeting and discussion with Mr. Jaffer, he submitted a $100 million funding application.
His partner phoned our office to give him some information on what was available in Canada. That's Patrick Glémaud. We gave him a broad spectrum from Halifax to Victoria. We gave him the size of the cities. We focus mostly on bio-solids, so we took the tonnages of the bio-solids of the major cities across Canada and put it all together and gave it to him. So he got that. We only gave him that information.
He did not say to you, “Look, this is a $100 million submission. I'm going to run it up the flagpole and see.” And he did not discuss with you finders fees or anything of that nature.
He did not represent himself to you and say, “I'm going to be representing your company to government, looking for $100 million”.
He didn't ask for any money. What he said was there was money available in a green fund. This green fund, to me, believe me, is like smoke. As far as I'm concerned, it's smoke.
You have to understand something. What I gave you looked very brief, but it was brief. He wasn't every waking hour in my thoughts. This guy came and went, and I only touched him a few times. Remember that. I'm running businesses here, and I haven't got time for this. I see lots of people with wonderful stories because they like what we have, and they all say “a billion dollars over here”, and I just say “Rubbish”. When I see those numbers, I know this guy's on his game. I'm not interested in that.
The fact that Mr. Jaffer submitted this $100 million proposal, unbeknownst to you, looking for money, the fact that Mr. Glémaud had said that if they had got any kind of interest by government they would have gone looking for a finder's fee, was all unknown to you.
We didn't know he had submitted it until we saw it on TV. We knew he'd put something together because he sent us a document later. We got the document, but he didn't tell us he had submitted it, or he didn't tell us it had been rejected. We heard nothing.
This is for clarity. We understand through Mr. Gillani and through government and Mr. Glémaud--I think it was Mr. Glémaud--that you actually had e-mailed to you, around about mid-September, questions that came from the Canadian government.
I can't remember that. I don't know if it was questions from the government or not, because I didn't do it. I didn't put that together. People in the office put that together, other people. I only know that they were given a list of the cities across the nation that bio-solids... We only focused on bio-solids because we knew what that was and nobody wanted to touch it.
It's just that the committee understands that there was correspondence between the Canadian government--in particular, Mr. Jean's office and his officials and the officials of the department--to you.
We understand there was some correspondence, so maybe Mr. Glémaud did it.
Were you aware, around September 3, September 4, that when Mr. Glémaud and Mr. Jaffer were submitting the $100 million proposal, he was also meeting with the Minister of Transport, Infrastructure and Communities at that time? He didn't discuss this with you?
I have to tell you, he didn't give us any information. When we heard this had been rejected, it was the first we knew about it. He never told us that.
Thank you.
Interestingly, there was an e-mail around September 11--and I know I'm going back some time ago--in which Mr. Gillani said something had happened that furthered his level of confidence in what Rahim can do, the Green Rite project, both in the short and long term. Are you aware of the claim that there were things he could do in the short or long term, that something had happened?
When you first were introduced... When Mr. Gillani set up this lunch for you, and Mr. Jaffer was in attendance, and you had this brief conversation where you inquired about Madam Guergis potentially writing the letter on your behalf, and you subsequently followed up on that, what were your expectations? Had you no expectations coming out of that at all?
No, no. Maybe I misled you. I'm sorry.
He talked about green funds, but very briefly about green funds. You have to understand, there is nothing specific. We hear this all the time from people. There are stories going around—“oh, we can get you this”. There are people coming in the door who can talk a terrific game.
Mr. Wright, you'll have an opportunity when other questions come.
[Translation]
Mr. Guimond, you have the floor for eight minutes. Go ahead, please.
Thank you, Madam Chair.
Thank you for testifying before us, Mr. Wright.
I am going back to your first meeting with Rahim Jaffer. You said that he introduced himself as a former member of Parliament. That is what you said in your answer to my colleague's question. Is that right?
[English]
[Translation]
It was when you first met. Did he mention that he had already been the chair of the Conservative national caucus? Don't you remember that?
[English]
I don't remember that. I do remember him saying that he had been a member for 12 years in Edmonton and that he had lost his seat in the last election.
[Translation]
When did you find out that he was the husband of the member of Parliament of a riding where you have one of your three properties? Did he tell you right away that his wife Helena Guergis was a minister and a member of cabinet? Is that when you found out?
[English]
Yes. He had said that he wasn't but his wife still was a member of Parliament. He didn't say she was a cabinet minister. He just said she was a member of Parliament.
She's a member. Okay.
[Translation]
Did you see Rahim Jaffer as a lobbyist who could help you to get funding from the federal government? Was that your take on things when you met with Rahim Jaffer?
[English]
No. Let me make you understand.
I didn't even know we had lobbyists here. That may sound funny to you people, but it's the truth. Most Canadians don't know that. You live in Ottawa, but we live miles away and we don't know. Until I saw this on television I really didn't understand. I hear about American lobbyists, but I never hear much about ours. I didn't really know that.
[Translation]
[English]
[Translation]
But did he introduce himself as someone who could help you? During the meeting, you surely did not just talk about the weather. You are not the type of person who could stop any random person on Sparks Street in Ottawa to ask whether they could help you to get funding from the federal government.
Forget the question about lobbying. You said it very well: the average Canadian does not know what a lobbyist traditionally does. Did he introduce himself as someone who could open doors for you to the federal government, the Conservative government, to get money?
[English]
At this meeting, the meeting with Gillani and him, we were not... We came into this and he came with his cousin to be introduced. Gillani didn't know him, and I believe that. That day they met for the very first time. So they were doing their talking and we left. They took off somewhere because they went off to that club they used to go to. They left. But another group came in and sat down with them; they were promoting as well. And we were out of there. So we did not get... I did the talking, to tell everyone at the table what we did. I described what we did, how we do it, technologically how it works and why. It's all microbial. We don't use accessed heat from anywhere else; we do it with microbes. It was all the technical things, because I'm the technical guy, and that's what we were talking about mostly.
Remember, we were dealing with this guy Gillani. We'd been working with him since sometime in July. On the 23rd of September, we ended it. So that was the window. So whatever he was doing with him, I have no idea, nor did anyone tell me. It was Gillani who asked us to give them the information about across Canada, from city to city, how much would there be required to do it.
Later on in a conversation, Mr. Jaffer gave me information for the Federation of Canadian Municipalities, and the information he gave me wasn't quite correct. He said to me there was funding there for municipalities. I'd done Whistler for the Olympics, and Whistler didn't have any money. After the Olympics they were broke. But they wanted one more tunnel. I had been out to see them, but they didn't have the money. So he believed that the federation had money to give them. So he gave me the number of a man there. I phoned his secretary, who arranged a conference call with him and another gentleman, a French Canadian gentleman. We talked, and he set me straight on what it was. It was that there is money available at a lower interest rate, but it's not a gimme; you don't get it for nothing. He had it wrong. I didn't get any further because I was still talking with Whistler.
That's the information he gave me about Ottawa, and it wasn't quite correct.
[Translation]
My attention was distracted from the list of questions I had prepared.
So then they left to go to a bar. But you, did you go to that bar? No.
[English]
Let me tell you, I've never been to a club like that in my life. I'm married 53 years. You wouldn't get me in there with a gun at my head.
[Translation]
But why do you refer to it as “a club like that”? It could have been a place... Why do you now talk about it like this? Was that discussed at the meeting?
[English]
They didn't invite me to the club. I'll tell you why they didn't invite me. You may get a laugh out of it.
At the first board meeting I had with Gillani, he came in and he said before he started... He got up and said, “I am a Muslim. I'm an Ismaili Muslim.” And I said to him, “Well I'm a Christian, and it's the Ten Commandments, not the ten suggestions in here”, because I didn't like that. That's the way it started. So he wasn't going to take me to a club like that.
[Translation]
[English]
[Translation]
[English]
[Translation]
[English]
We have been always looking for funding for projects. We have projects in the United States. We have nothing in Canada at the moment, but we may have shortly. We haven't done a lot in Canada, but we've done a lot in the United States. It's easier to get one in the United States than it is in Canada. So there's venture capital, which Gillani said he was. He is in a way, I suppose, but he's not my kind of guy. I don't like the way he operates. He's not my kind of person. You have to have a likeness with somebody to do business with them. If I don't like somebody, I'm not going to do business. I don't care who they are, what they've got, because I have principles.
Anyway, no money came from that. We get funding from overseas, from London, New York, and places like that. We don't get it from here. We've never gotten anything from here.
Thank you, Madam Chair.
Thank you, Mr. Wright, for being here this afternoon. We appreciate your time.
You just said, referring to Mr. Gillani, you don't like the way he operates. I'm just wondering if you could expound on that. I think people are generally curious about this individual. We had him here as a witness, and I think your impressions of him in the business world would possibly help us establish his credibility as well as some of the things that he said. Could you just maybe elaborate on your comment a little bit?
I'm a very prompt person. I was here two hours early today from Toronto. I can't stand a person who keeps saying “I'll be there”, “I'll do it”, but never does it. I hate that. It just got so bad that he was... I would phone him, because he would say something, and when I wanted it in writing, it came back different. It didn't come back the way he said it. It never did. He was moving the goal posts. He was looking for more and more share in the deal, and he wanted to take over. I never would do that. I run my show. I've done it for forty years. So he and I didn't see eye to eye. I just said, guys, it's over. I sent him a text message. Actually, my son sent him a text message on my phone, because I don't know how to text message--I'm old.
Well, sometimes I get my daughter to do things. She's not that old, but certainly kids have a better understanding of some of this.
In terms of the relationship that you had with Mr. Gillani, there have been reports. There was a Toronto Star reporter who reported that there was a $1 billion deal to take your business public. There were allegations that Mr. Jaffer and Mr. Gillani would somehow benefit from that deal financially. I wonder if you could set the record straight. Can you elaborate? Can you tell us?
You've stated that Mr. Gillani and Mr. Jaffer had no business dealings or relationship financially with your company, but there have been these reports. We need some clarity, I think, on that.
Mr. Gillani would have liked to take it somewhere, but not where I'd go.
First of all, he was introduced to me through one of my associates by one of his associates. I didn't really want to meet him because they said he wanted to take it public. I said, “I'm not going public”. I'm in business myself. I said, “Why would you take a good company public? If it's a good company, keep it.” So I didn't want to do that, but he had ideas, and I listened to him. That's the day he started off with his Ismaili Muslim stuff.
Anyway, his idea just didn't work out. I've been in business for many years, and I have good equipment, and it is all over the world. People want to take it and steal it. They all think I'm Irish and I'm green or something, but I'm not. I'm not that dumb. I've been around a long time, and they're not going to steal anything. So I show them the door. His ideas, what he was talking about, were his ideas. They were never going to happen with me. Never. So what they wrote and what he said was not on.
You don't know then where this description of a $1 billion deal came from. Do you know where that came from? You don't.
Were you aware of the letter that Ms. Guergis wrote to the municipalities in the community in support of your company?
Obviously the connection was made by Mr. Jaffer, the initial conversation to initiate or solicit her support.
Right.
Did you get any indication as to whether there was an expectation of remuneration--that if things went well, Mr. Jaffer would benefit financially from a deal?
There never was any anticipation. I only asked her as I would ask any MP. I asked the MPP up there, Garfield Dunlop. I went into his office in Midland and solicited him as well. I never got anything from him either.
Now, in all these conversations that took place between July and September between Mr. Gillani and Mr. Jaffer, did they state at some point that they could open the doors of the Prime Minister to you? If so, did they ever demonstrate that they had that capacity?
Never. I mean, if he said that, I'd look at him and say, “You gotta be pulling my other leg”. Come on, that's daft, absolutely dopey. He never even tried it.
You seem to indicate that you had no intention to develop a business relationship with these guys regardless as to what they could secure for you or claimed to secure for you.
As I said before, Mr. Jaffer and Mr. Gillani are very nice men. I met them, and they were nice men. But they're not professional. They're not sharp. They're not business guys, you know what I mean? They're not on the game. They don't know how business works. There's no way we give people money unless they do something for it. We do pay finders fees to people that bring projects to us, and things like that, because that's the way you get a project, and there are people out in this world who find projects for you.
It sounds like you got wrapped up in an investigation here that clearly you'd prefer not to be in, and it seems to be that there are limited connections to you, or to the government, certainly.
This is the question: is there any connection between yourself, your company, either of your companies, and the green fund?
I think Mr. Holder was raising his hand.
Would you like to ask a question? You've got about a minute and a half.
Thank you very much, Madam Chair.
And thank you, sir, for attending.
We like to say, some of us here on this committee, myself included, that we'd been business people before being in politics, presumably because that gives us some insight or wisdom. I'm living proof that this is not necessarily the case, but I need to ask you a couple of questions.
You've gone on at some length about the qualities that Mr. Jaffer and Mr. Gillani demonstrated, which suggests to me, certainly from what you've said, that as it relates to Mr. Jaffer, he didn't even know how business works. But if Mr. Jaffer was so bad, why would you provide confidential corporate information to him to allow him to put a presentation forward?
I have five partners in Green Right. Green Rite Solutions has five partners. As you can see here, Wright Tech is me. The invention is me. The technology is me. But the other is a financial, as we said here, arm to go and find money and own and operate facilities.
Say we go to a corporation or a municipality. Our sales pitch is simple: we say—
We say we have a solution to your problem and we have the money to pay for it, and they like that. So we come in, and what we do is we put together an unsolicited proposal to build the facility with our money and charge them a tipping fee, usually the same as they are currently paying or less for a straight-line twenty years, best date and time, and that's what we do.
Thank you, Chair.
Thank you, Mr. Wright, for being here.
I might say, as well as Mr. Warkentin, that you seem like a forthright, honest, nice man, with an interesting business, and I'm sorry you're dragged into this, but we do appreciate your being here.
It seems like Mr. Glémaud was acting on your behalf beyond what you knew about. I have some e-mails here actually where he was negotiating with the minister's office about your proposal, and they were asking specific questions and he was giving very detailed answers.
One of them is the minister wanted to know, “Have the 11 municipal sites already agreed, and which are they?”, because Mr. Glémaud was saying there were 11 more cities that were on board with this. Mr. Glémaud answered that the Regional Municipality of Whistler agreed to expand their facility--you've mentioned this--and also that the GVRD, the Greater Vancouver Regional District, is willing to go ahead when the funding is available, as well as the City of Victoria, Powell River, B.C., Calgary, Alberta, the City of Guelph, the Region of Waterloo, Northumberland, Ontario, Quinte West, and the City of Welland.
Did all of those cities agree to—
They were cities that required attention. They had a waste problem with bio-solids, and we could go in and do this, and we had funding. That's what it was.
His language is:
The following are the municipal sites that the technology has been introduced to and are willing to go ahead if funding is available.
Would that be overstating the situation?
He's representing your company in a fairly aggressive way.
One of the other questions the minister had is, “Could you tell me if and how the company separates organic from non-organic wastes in the municipal sites?” And he goes on to quite a detailed answer.
The dates of this are interesting. You said that as of September 23, 2009, you pretty well ceased to have anything more to do with the...
I didn't say anything to them, really, because I hadn't been talking to them for a while, you know. And then—
Because that exchange was September 22, but as of September 30, the parliamentary secretary, who is the gatekeeper for this fund... The parliamentary secretary's office said:
Mr. Jean was wondering if there could be any direct application for trees ruined by mountain pine beetles.
And the answer was:
Yes. The trees destroyed by mountain pine beetle could be used in conjunction with the biosolids or food waste. Trees will be chipped into smaller particle sizes...
He would have had that in our description, because we have a standing description of what we do for people. We would take that type of description anywhere we went. That would be common. People could get that anywhere. We would have handed that over to people.
No. Nobody ever mentioned lobbying, and I didn't know about lobbying. You have to go back there. It's not today. Today I know, because I see it. To go back there, I had no idea. I didn't even know you could lobby.
As late as October 13, they were still going back and forth on your behalf. Now, if he had managed to convince the government to give you the loan, did you authorize him to continue negotiating with the government on your behalf?
No, what I think I said—hopefully I said it right in here—was happening was that he had told us it's a very difficult road, with all the loops and hoops that you have in Ottawa, to apply for these things, and we wouldn't know how to do it, and we wouldn't. He would know how to apply for all these things; he could do that. He was a former government lawyer, I believe.
So he would know how to help us really get that for municipalities. I think I said it right in here somewhere. I said exactly that. I did say that we would do it ourselves, so what was the point?
And we probably didn't know it until that happened. You know, until somebody does something or commits to something, you don't really know what they're doing.
It seems to me these guys are like parasites, suckering themselves onto a quality company like yours for the—
Well, I wasn't the only company; they had several companies. They were talking to other companies. He did mention a kinetic plate and solar. He was very big into one of them, I don't know which one it was. As I said, he wasn't talking to us much, and we were out here. He wanted to represent us in China. I said, “No, I'm not going to China.”
—if this process had led to saying “Okay, Green Rite Solutions is going to get a loan or a grant of x number of dollars”?
They may come back and ask for a finder's fee, or whatever they call it. They never mentioned that to me going in. You know, in the business there's a finder's fee anywhere from 2% to 10%. That's normal in the business, but they never mentioned that. There was never a percentage mentioned, or anything to do with that. Amazing. I have to tell you, I had dismissed them. I hadn't really...
You know, I have a business to run out of here. I have several businesses—I have about ten... I go to work at six every morning. My wife says, “When are we going to quit?” I said, “They'll take me out in a box.” I can't help it; this is what I do.
So, you know, that's not a big part of my day, it really isn't. I have something I had to do today. I have a job to get together tomorrow, but I should have been doing it today, but I'm here today, and that's my day. That's the way it is for me.
We do appreciate your cooperation. You should understand, too, that our interest is to make sure that this multi-billion-dollar green infrastructure fund is distributed fairly and properly, without any undue influence by well-connected people, etc.
Why were we rejected?
I can tell you, there's nothing greener than what we do. If you could tell me something greener, I'd like to see it.
I'll give my time to Mr. Wright.
I think you've done us a great service by being here, and you do seem to have an excellent product. I learned a great deal, actually, from this e-mail exchange and the answers. The reason I focused on those is because it did sound as though he was getting very specific information about your company that he was passing on to the minister's office on your behalf, though he really was your agent, whether you knew about it or not.
Mr. Gillani had that, but as I said, he wouldn't be the only one with it. That's a package we'd put together. We've put that together for many people.
As I said, we see lots of people coming and going. I'm going back many years, where I've had guys who were going to take this thing public, and then venture capital guys come in and they have a great story. They only want this much. But when the real workmen show up, if Pierre Bourque shows up and you read it, they want that much and I'm out on my ass in the street, every time. What are we, all dopey or something? They must think we're joking or something, but that's what we get.
Sorry for that.
No problem. Thank you very much. At least you're clarifying stuff for us.
We'll go to the next round of questions.
Ms. Mendes, you have five minutes.
Thank you very much, Madam Chair.
Mr. Wright, I've understood pretty well what you've said so far, but if you weren't in touch with Mr. Jaffer and Mr. Gillani after September 23, who in your company was?
I will ask this question because, in the interest of disclosure, in front of me I have a contract signed by your son and Mr. Gillani.
We have that, and that was signed by Stephen Wright, who's the president of Green Rite. He's sitting behind me.
He texted them. He texted them on my phone, because he was to be at my office at five o'clock, after missing a lot of meetings. He was to be there at five o'clock. I waited and waited until 5:30.
What he was doing to me was this. I know what his game was. I'm a bad-tempered guy some days. I don't like being pushed around. So I would phone him, and his message machine would come on and say he was very busy today closing a deal, and so on, and to leave a message. I'd leave a message and he never called. Then I finally phoned his cellphone. One of his flunkies picked up his cellphone and answered it. He knew it was me, and he wouldn't talk to me. I said I was fed up with this and told them to get this thing straight, that I wasn't interested in this. He said, “We're coming at five o'clock tomorrow”, and so on. So I said okay, because I like nothing better than telling somebody right to their eye, “You're finished.” I really don't like to do it on the phone. I'd rather belt them in the mouth, to tell you the truth, anyway. Sorry.
He didn't show up at 5:30. I had smoke coming out of my ears. I really did. I was so angry. I said to Stephen—because I can't text—“Use my phone, text him, and tell him he's unprofessional; it's over.”
Within three minutes, that Frank guy, whose name you've heard mentioned here, with one of his associates, phoned back and said, “Jim, we texted you at 3:30”—they hadn't—“to say we wouldn't make it.” I said, “It doesn't matter, Frank. What do you not understand about over? It's over. You tell the guy it's over; I'm finished with him.” We were well finished. Frank phoned me two or three times, and I said, “Frank, it's over.” And it was. We've never spoken again.
I'd like to go, just quickly, to Ms. Guergis's letter to the councillor in the County of Simcoe. After that letter was sent by Ms. Guergis to the county, was there any other follow-up from Ms. Guergis's office? Did they try to find out?
Okay.
Before I pass this on to my colleague, did you witness any behaviour by either Ms. Guergis or Mr. Jaffer that would eventually be cause for blackmail?
We talked on the phone that time about a letter, but I hadn't gone to any of the other meetings. When Mr. Jaffer got into trouble with the driving incident, we kind of moved on.
Thank you very much.
Again, thank you for your candour today. I would love to be able to provide you the departmental analysis on the submission that was made for the $100 million, but we don't have it. We do have it for other submissions, but not for this particular one. So I'll simply say that.
We do have the executive summary, if I can use that term, that does talk about the project developer being Green Rite Solutions, an Ontario corporation, and that the project proponent will build and operate eleven different facilities located in municipalities across the country. They went so far as to use your company to say they were going to do all this manufacturing, build these eleven facilities.
I find it unusual—and I'd like your perspective on it—that the Government of Canada, through this access that they gave Jaffer's company to submit this proposal, didn't do due diligence to actually talk to anyone in your company.
We do have e-mails that went to a Mr. Jerry McLeod of your company, but that's the only connection.
I don't know about that. When I see Jerry tomorrow, I'll give him a shout. I'm seeing him at 1:30 tomorrow. I never heard of that.
[Translation]
Thank you, Madam Chair.
Good afternoon, Mr. Wright.
Mr. Wright, we want to establish the link between Mr. Gillani, the Glémaud-Jaffer tag team and Minister Guergis. We want to see whether all these people have been involved in some scheme or other, to help your company, Wright Tech Systems, to get federal funding.
You told us that you had never received federal funding and that you found the way the Glémauds and Jaffers of the world went about it was lame.
However, Ms. Guergis wrote a letter, with no connection to her ministerial role, in order to introduce your company to municipalities or politicians.
Could you tell us more about Ms. Guergis, the federal member of Parliament in your riding, and her efforts to make your company known?
[English]
I asked her because she was my MP. It was said earlier that I wasn't in her riding. I am in Collingwood. I've had a place in Collingwood for 32 years. That's her riding. I have one over in Midland that's not, but that's the MPP, the Conservative, Garfield Dunlop. I also went into his office with my brochure, with the stuff you're reading here, all that stuff. I showed him what I could do.
Site 41 is very important to me, because I love Georgian Bay. It's a very special place, and we were going to destroy the water. If they put that landfill in there, it would destroy the finest water in the world. There was a band of people up there who didn't want it. In fact, they won the day, because it was decided that it will never be done. They'll never put a dump there.
I would ask any MP or MPP to help me. I hope I have a right to do that.
Her secretary said she'd talk to her, because she was in Vancouver or somewhere, but she did give me a two-minute call, and I got a letter.
[Translation]
[English]
I do have a copy. I didn't bring it, unless my son has one. I didn't bring it because I knew you had a copy of it.
It went to her cousin, Tony Guergis, who was the warden. He was the one who was promoting the dump. He probably wouldn't want to know about what I had, because I had the opposite to that. I had it so you don't need a dump any more; you can end the dump. They're dinosaurs, those things. They have 40 dumps in Simcoe, and most of them are leaking. In fact, PCBs are now leaking into the well water in Penetang, so why put another one in? It's nuts.
I thought that was the right thing to do.
[Translation]
Okay. Did these letters make a difference in the municipalities for example? Did stakeholders call you to tell you they had received a letter from the minister and that they wanted to follow up with you about your company, in order to get to know you better?
[English]
The letter might as well have gone to the moon, because there was absolutely not a whisper or even a whimper--nothing, zero.
[Translation]
So your efforts were completely honest, and, in return, there was no response. Perhaps today, with your appearance here, you will become a star and you will be better known. We wish that for you, in the best sense of the word, of course.
Do you know a little more about Mr. Gillani? People described him to us as a crook. Could you tell us more about the way this man did business?
[English]
No, only what I said. He's not the first man to move the goalpost when you try to do a deal.
VC means venture capital, and in our business we call it vulture capital.
[Translation]
Thank you very much, Madam Chair.
Thank you for being here, Mr. Wright.
I am impressed by Jim Wright, the man. I have a question, but, in order for it to be better understood, could you first give me a brief two-minute history of your career and life as a businessman?
[English]
Where do you want me to start? Remember, I'm here 53 years.
The reason I came to Canada--I was 20 years old from Northern Ireland--I wanted to play hockey and I wanted to ski. I became a hockey player and a coach and a ski instructor. I loved it. This is God's country and I love it. That's why I'm here. I think I live in the best country in the world. I have two children and five grandchildren. My wife is from Ireland also, and we couldn't live in a better place. We have lived in the United States. We have a home in Florida. This is the place. I love the winter. I love to ski.
I got into this business because a long, long time ago I looked at the environment, which I love. I'm an outdoors person. I love the outdoors. I've taught scuba diving, sailing, boxing, everything. I have done it all. I love to be outdoors. I didn't want my grandchildren to grow up in a sewer. The way we've been treating our waste for many, many years, that's where we're going. That's why we've got wells with PCBs, because these online dumps are a nuisance. They should be finished. We shouldn't ever have a dump again. There's enough technology in the world never to have a dump again, but it's getting it through to the politician to understand that you don't have to have a dump any more.
A friend of mine who grew up with me in Ireland lives in Powell River, B.C., where I was married. Some of you may not know where Powell River is, but it's in B.C. He was a mushroom grower who discovered a way to grow mushrooms without straw and manure. He was the first guy to do it in the world. Very clever. I made him a machine that took alder and stripped it in like straw so you could grow mushrooms. Powell River used to be the largest pulp mill in the world at one time, and they had a lot of pulp sludge, which they dumped in the ocean. He said he could grow it in pulp sludge, and he did. Then he said he could grow it in garbage. Do it, I said. When he did it, I said we must mechanize it.
That's our story.
[Translation]
Thank you, Mr. Wright. You are a patient man, of great credibility and with a tremendous amount of experience.
As to Mr. Gillani and Mr. Jaffer, you said earlier—
[English]
[Translation]
[English]
[Translation]
We see you are a very experienced man. You said that, in your relationship with Mr. Gillani and Mr. Jaffer, they did not have much credibility. In your opinion, did they really not have the skills to help you?
[English]
Sorry. If I said that, it's not what I meant. When I met them, it was my understanding it was the first time Gillani and he had met. Gillani's cousin--I think his name is Aleem—is in Ottawa and has a reputable business here. He brought Jaffer to the table that day, and that's when I met the two of them.
But that day I had no idea what Jaffer could do, or was, or anything. That was the first time I ever met him. Our meeting was very short--maybe 40 to 45 minutes. We had started lunch and then they came in. He was late and we left. Another party came in to meet as we were leaving. They were talking about going downtown to the club they go to, which maybe they did or didn't—I guess they did.
But I wouldn't say “disreputable”, because, to be honest, Rahim Jaffer and his partner, Patrick Glémaud, seemed to be decent people. I don't think there's anything wrong with them. I don't know if they are crooks.
As I said before, Gillani moves in a different world. There are VCs and there are VCs, and I've met them all. I've been around a long time. If you live as long as me you meet a lot of worms.
[Translation]
But I would still like to thank him, Madam Chair. We have a great man before us. Thank you very much.
[English]
[Translation]
[English]
[Translation]
A point of order, Madam Chair. Mr. Guimond called me a fool in committee. Please, I demand an apology. I just said that Mr. Wright is a great man, a great Canadian and he called me a fool. Madam Chair, I raise a point of order and I am very serious right now. Will Mr. Guimond withdraw his comment? Yes or no?
[English]
[Translation]
Yes, Madam Chair, I went off on the wrong track. I withdraw my comment, but deep down, I am still thinking it.
[English]
Okay, that's enough. We can't have childish behaviour.
Mr. Wright, thank you very much for being here.
We'll suspend for 30 seconds.
The Chair: We are continuing our study on the green funds. We have before us Mr. Ian Harvey. I think we have committee business, so we can go until 5:20. The bells will ring at 5:30.
Mr. Harvey, do you have any opening remarks?
First, I want to thank the House of Commons Standing Committee on Government Operations and Estimates for inviting me today to answer questions with respect to the renewable energy projects funding by the government.
I'm here to answer questions pertaining to what this committee has been established to investigate. However, as the committee may be aware, and as has been reported in the media, elements auxiliary and unrelated to the mandate of this committee are also being investigated. I hope I'm not put in a position to answer questions that could potentially compromise an ongoing investigation.
The following information is what I was party to with respect to the mandate of the committee. For reference, in February of 2009 my company, HD Retail Solutions, had begun discussions to engage Nazim Gillani and his company, International Strategic Investments, to raise capital in order for our company to execute its business plan. Formal agreements were drafted in March 2009 to this effect.
On August 25, 2009, I was invited to attend an afternoon meeting by Nazim Gillani at La Castile restaurant in Mississauga. I was introduced to Rahim Jaffer, and he provided me with his business card, a copy of which I'm going to submit to the committee as exhibit 1. He described his experience in and knowledge of government and a $100 million green fund he was somehow involved with. We presented our business plan, and he did not commit to funding or setting us up with funding at that time. The following day, August 26, 2009, I was surprised to receive a message from Mr. Gillani stating that he expected to receive a term sheet the following week from Mr. Jaffer for our company in the amount of $5 million at 2.4% interest and repayable out of net profits. This would have entirely fulfilled our capital requirement and allowed us to execute our business plan. This is submitted to the committee as exhibit 2.
We were thrilled at the prospect and awaited the term sheet. No such term sheet was forthcoming in the following weeks. I inquired of Mr. Gillani as to the status of this funding opportunity from time to time but never received a definitive response. On September 11, 2009, I received an e-mail from Mr. Gillani stating that “Mr. Jaffer has opened up the Prime Minister's office to us and as a result of that dinner--he today advised me that he is just as excited as we are and joining our team seems to be the next logical step.” This has already been submitted to the committee, I believe, but I also submit it as exhibit 3.
I'm not sure exactly why he sent me that message. I assumed it was to illustrate that he and Mr. Jaffer were increasing their engagement and perhaps to infuse some new hope that government funding was forthcoming for our business. I found out in the coming days, in the media, that Mr. Jaffer had been arrested for speeding, impaired driving, and cocaine possession in the early morning hours of September 11, 2009. After this news was reported, I wasn't hopeful of any government funding being made available for our business.
On October 16, 2009, I had inquired as to the status of our funding situation by e-mail to Mr. Gillani, and he replied that he was “just wrapping up with the funders and Rahim and Patrick”. This is submitted to the committee as exhibit 4. I assume those named individuals to be Rahim Jaffer and Patrick Glémaud. If true, this would indicate that ISI and GPG were still engaged at the time.
I did come forward in the media, subsequent to April 28, 2009, in response to some false statements made by Mr. Gillani to this committee. I can only speculate as to why Mr. Gillani made those statements. I do not feel it is pertinent to the matter in front of this committee or constructive to any of the affected individuals to elaborate on those speculations. Further, it may not be helpful to the ongoing investigations to delve further into what information may have been shared or inquired about on this matter. The deceptive conduct of certain individuals in businesses, some associated with and some not associated with this matter, has cost us our business and caused irreparable damage to our former company, HD Retail Solutions, which is now bankrupt as a result, and caused undue financial and other personal distress to the company's employees, investors, suppliers, and stakeholders in general. We accepted the information we received from those we were in business with as truthful and conducted our business on that basis. Our collective victimization as a result of that information and other actions is now being dealt with by the appropriate authorities. We continue to seek advice to determine whether any further course of action on our part is sensible.
From my perspective, our brief encounter with Mr. Jaffer and subsequent communications pertaining to the result of that meeting from Mr. Gillani were just a few of many elements in the rollercoaster ride of raised and dashed expectations that our company's employees, investors, suppliers, and stakeholders endured, as Mr. Donovan accurately mentioned in his article of April 30.
If the trust of the citizens of Canada has been somehow violated, as determined by this committee, I hope that justice is served. I'm here to assist in any fashion this committee deems appropriate. I invite the committee to ask any questions it may have of me with respect to the matter at hand.
[Translation]
A point of order.
Madam Chair, the witness mentioned some exhibits. I came to see you and you told me that he was going to submit them. A number of times during his presentation, the witness mentioned that he had sent those exhibits to the committee. I think we need them. There are four, one of which is Rahim Jaffer's business card. That would be relevant to the extent that it allows everyone to direct their questions appropriately. Could you ask the witness whether he submitted them to you or he will provide them to us immediately?
Could you also reassure the witness that he has parliamentary immunity? He started his presentation by saying that he was hoping his remarks will not compromise the investigation. We should perhaps reassure him and tell him that, no matter what he says, he is protected as a witness and he can testify freely and voluntarily.
[English]
Okay. So number one, you had stated in your presentation that you have a card that Rahim Jaffer gave and that you would give it to us in exhibit.
I can just send the clerk over.
And number two, the second thing was that you had stated that you were concerned about talking here, and Mr. Guimond is making it very clear that you have parliamentary protection, so you should have no worries when we ask you the questions.
Again, I just want to clarify, the investigation isn't concerning what I've done. It's about what has happened to our company. So I just want to be clear that I'm not put in a position of jeopardy.
Fair enough. We will not ask questions regarding that, or we will try to ensure that things are limited.
Madam Chair, just to clarify, what Mr. Guimond asked for was for all the evidence that Mr. Harvey is submitting, not just the card. So it's the four pieces of evidence.
Okay, the four pieces. I'm sending the clerk over.
For the first round of questions we will go to Madame Coady. Eight minutes.
Thank you very much.
We appreciate you appearing before committee and for tabling documentation. We would appreciate any information or documentation you have to be submitted to committee. So thank you very much.
First of all, you talked about the August 25 meeting where you met with Mr. Jaffer and Mr. Glémaud, I think, at a dinner.
Sorry, okay. Thank you.
What was your interpretation of that? Were you expecting him to do anything for you after that particular meeting or lunch? What did he offer you?
I guess I could preface it by telling you what led up to that afternoon meeting. I got a call from Mr. Gillani saying that there was an ex-MP who had access to some government funding and he wanted us to come and present our business plan. I didn't realize, at least at that point in time, that it was Rahim Jaffer or that it was the green fund in general. But he did then mention... We had an element of our business that was focused on green initiatives in retail, such as--I believe Mr. Snowdy was in here and made this point--more efficient lighting, energy utilization efficiencies, and the other one was obtaining efficiencies in the retail supply chain. So those were topics we touched on. They certainly weren't the core of our business by any means.
Did you discuss the availability of funds? You said that you went to the meeting with the anticipation that there was access to funding available. So did you discuss funding, and specifically the $5 million government loan, which you mentioned in your opening statement? Can you elaborate on that, please?
Yes. At the lunch, or at the luncheon--it wasn't really a lunch, it was a mid-afternoon sort of thing--first of all, he introduced himself and talked about his past in the government, his 12 years in office, and we were of course thoroughly impressed that we had someone who could potentially get us funding via a government channel.
Without knowing the definitive term of “lobbying”, I would say that he was someone who had access, sure.
Parliamentary business card, yes. MP, Edmonton—Strathcona, I believe. On the opposite side it was in French.
Your clock is off.
I want committee's permission... On the documents that I have, the exhibit that might be relevant to your questioning, can I have permission to distribute it? It's in English only.
Oui ou non?
Some hon. members: Oui.
[Translation]
[English]
Thank you very much.
Just back on that, when you met with him you were anticipating access to government funds. You were told about a $5 million fund. You subsequently got an e-mail saying that this fund was going to be--
I had said to him that in the case of our business we needed $5 million--not talking about terms or anything like that, just the quantum of dollars we were looking for. And he responded saying that the amount wasn't the problem; it was a question of whether we fit the requirements of the funding. So frankly, when I left from that lunch I didn't think we were going to fit a green fund, in the sense of the words--
My business partner shot off a message to Mr. Gillani saying thank you, and hope we did him justice, and the next day he responded, saying that we--
In your opening statement you actually said that after you heard that Mr. Jaffer had been in trouble with the law and had been arrested, it wasn't hopeful for government business after this incident. What did you mean by that?
Given the nature of what had come out in the media at that point in time, my assumption, which proved to be a false assumption, based on subsequent communications from Mr. Gillani, was that he was going to distance himself from anything to do with Mr. Jaffer until his affairs were sorted.
Based on the fact that you, in your mind, thought you were going to get a great $5 million, low-interest loan, how did you think you were going to remunerate Mr. Jaffer for this access?
We had an agreement with Mr. Gillani on his finder's fees. I don't know how the funds were going to have flowed to Mr. Jaffer, but we were expecting a 10% finder's fee, which amortized over a five-year term would probably have been something we could still service, even at 2.4% interest on top of that.
He is a long-time friend, about 20 years or so, of one of my business partners. He looked into the affairs of our business before I even really knew about it. He was concerned about Mr. Gillani and what he was potentially setting us up for.
I first had an engagement with Mr. Snowdy in about June or July. We didn't pay him anything. I mean, I didn't... I picked up a lunch or two here or there, but we didn't have a contract and an investigation agreement with him or anything.
I understand that he had to ask your permission before he disclosed information he had to the Conservative lawyer. Is that correct?
There is an element of it where... I tried to keep a little bit of distance between anything he had that didn't pertain to our business and anything outside of our business affairs.
This whole talk about cellphone shots and busty hookers and all this kind of stuff that has made its way into the media wasn't something that concerned me as far as our business goes. If they were elements that he had discovered during the course of his investigation, then I gave him permission to go ahead and use his discretion to provide whatever he needed to, to Conservatives, Liberal Party, whoever else needed it.
So even though Mr. Snowdy came to you and said “I have this information, I'd like to bring it forward to the Conservative lawyer”, you have no idea to this day what information he brought forward or whether or not it included Madam Guergis or the affairs of Mr. Jaffer, access to government, and things of that nature.
I want to go back to that $5 million loan you anticipated getting. You anticipated paying a 10% fee on that. You never saw a term sheet on that?
No, there was nothing like that. As I said, the only communication we had around the terms of anything like that was in the e-mail that came the next day.
Around that same period, you received--and you said so in your opening statement--an e-mail from Mr. Gillani saying they had “an earth moving experience last night”. What was your interpretation of that claim? What did you think he meant by that?
Because we hadn't heard anything in a few weeks with respect to the government funding, first I questioned why I was even sent that e-mail. And then I tried to connect the dots and thought that perhaps he had sent it to me to let me know he was still engaged with Mr. Jaffer--
[Translation]
[English]
[Translation]
Do you, unlike Mr. Wright, know what a lobbyist does? Are you aware of the lobbying system here in Ottawa?
[English]
No, I certainly do not. I lived in the U.S. for ten years. I had a better idea of what lobbying was about in the U.S. than I do in Canada. But at the very least, I understand it has something to do with--
[Translation]
Rahim Jaffer met with you and gave you a double-sided business card, which referred to him as Rahim Jaffer, member for Edmonton—Strathcona and chair of the Conservative national caucus. Then there was the address of his office, and so on. He gave it to you at a meeting on August 25, 2009.
So you saw an opportunity to get federal funding. Isn't that so?
[English]
[Translation]
You saw in Rahim Jaffer the one who would give you the combination to the safe to get grants for your perfectly legal and legitimate company.
[English]
Did I think he could get us funding for our company? Yes, I thought he could be a link to getting us government funding. Did I think he was going to open the doors to the Prime Minister's Office? No. That was a stretch, even in my wildest dreams.
[Translation]
Perhaps not open the doors to the Prime Minister's office, but, when you met, did he tell you he could put you in touch with ministers and parliamentary secretaries? Did he mention the name Brian Jean, who is Parliamentary Secretary to the Minister of Transport, Infrastructure and Communities and who manages a fund of almost $1 billion?
[English]
[Translation]
[English]
No. He never said he was going to put us in touch with the right people. He never said he was going to cut a cheque for us, or anything like that. We were left to walk away with the impression as to how we felt he was going to achieve that.
I think he was responsible, in that he didn't make mention of how he was going to get us funding. He just said that he had relationships in government and that we could potentially qualify to get funding from the government. How he was to achieve that, through his partnership with Mr. Gillani, was something I didn't know about.
[Translation]
[English]
[Translation]
[English]
[Translation]
[English]
Without a doubt, I was surprised to get that card. That being said, I don't recall there being a caveat attached to his handing that card out to us. But he certainly didn't say, “I work for the government. I'm going to get you funding.”
I knew he was no longer in office, so I was able to draw my own conclusion that he still had relationships with the government, but not that he was going to knock on the doors of the caucus and get funding.
[Translation]
As to his connection to the government, did he tell you that his wife was a cabinet member, a minister?
[English]
He didn't mention that. I found that out just doing a Google search on him. So it was after the fact that I found out he was actually married to former minister Guergis.
[Translation]
[English]
He was there, yes. He was the one who I think you would say hosted the lunch or the afternoon meeting.
[Translation]
Did you have other meetings after that? I know you had that meeting. But were there others where you talked about how to obtain information or forms, or how you could get funding for your business projects?
[English]
Outside of that e-mail that we were sent the day after, that was the only further indication that there was to be something forthcoming with respect to funding our business.
[Translation]
Remember how Mr. Jaffer dealt with you at the time. On other occasions in your company, were there people who did this type of lobbying to help you to discover the places from where you could get federal funding?
[English]
[Translation]
So that is what makes your meeting with Mr. Jaffer unique. He dangled some things in front of you, without necessarily handing you everything on a silver platter. He tried to get your permission to provide you with information that could have given you the opportunity to get funding legally from the federal government.
[English]
It's tough, really, to answer that as far as the impression I had versus what was actually discussed. Anything that we got as far as representations of terms or even the dollar amount and the interest rate, all that sort of stuff came from Mr. Gillani, and we assumed it was via Mr. Gillani from Mr. Jaffer. Whether that was actually written by Mr. Gillani with or without consultation with Mr. Jaffer is entirely something I can't answer. I don't know. That was at the end of any discussions around government funding.
[Translation]
On the business card Mr. Jaffer gave you and that we have a photocopy of, his address is the House of Commons, Parliament, in Ottawa. There is no mistaking that. Did he imply that it was a place where he could be reached?
[English]
He didn't say, either way. If I was going to send him an e-mail, I probably would have ended up sending it to a parliamentary account. We never were instructed to. We were working through Mr. Gillani, as our intermediary, or broker, or whatever you want to call it, to funding. We would always contact him and he would liaise with the sources of funding.
[Translation]
[English]
[Translation]
[English]
I'll share some of my time with Mr. Brown.
Mr. Harvey, thank you very much for your appearance here today. We appreciate this.
What we're all trying to do here in the committee is connect all the dots, and they seem to be disparate dots at times. There are two areas of relationship I'd like to focus on with you if I may, first with Mr. Gillani, and then with Mr. Jaffer and his partner.
I'm just trying to understand in more detail what your original relationship was with Mr. Gillani. Can you just succinctly give us a sense of how you started with him? I have a few questions related to that.
In February of 2009 we had begun discussions. By March 2009 we had an agreement in place that he was going to raise funds for us via a public raise. That was subsequently amended in June to a different type of public raise. By the time we got into the fall of 2009, we knew that it really wasn't going anywhere. We had started to wind down the relationship. Going into December 2009 it forced our company into bankruptcy because we didn't get any funding.
We were. I'd say it's a matter that has to be determined as to whether our company was actually public or whether we were sitting as a showpiece for a publicly traded company.
I would presume either you were or you weren't public. If you were going through a process to perhaps become public, I think it's again different. Were you public or private?
There was the Nevada Corp., which was HD Retail Solutions, and there was the Ontario Corp., which was the operating business.
As to whether the deal had been consummated through what we were actually given is a matter at hand to be determined by the authorities.
It was my first foray into anything that had to do with a public offering. We went with what we were told.
How many meetings might you have had with Mr. Gillani? From the original meetings to when you decided in December of that year that it wasn't going anywhere, how many meetings would you have had with Mr. Gillani?
Oh, my gosh, there were dozens. We were meeting with him on a regular basis, trying to get our business plan together and getting updates on the status of the potential private funding and the public placement.
Among those dozens of meetings, if I might help you a little, at what point did Mr. Jaffer's name come into the picture?
Yes, we were the second group. I wasn't sure if there was a group after us or not, but there was a group before us.
We shook hands. I vaguely recognized those two individuals, not Jim Wright but the other one. I believe it was Mr. Stephen Wright who was there.
That's fine. Jim Wright.
The question I would have for you is this. How long was the meeting? From the time you spent with him that afternoon until you later said goodbye, how long was the meeting?
It was an hour. All right.
I'm trying to get a sense of it. We've now connected to Mr. Jaffer in that particular meeting. I'm trying to get a sense of it. I'm trying to build on Ms. Coady's comments as well.
What were your expectations of Mr. Jaffer? I had a sense that you thought he would be able to access funding for you through some potential government connections that he had.
You've presented this card. I know that Mr. Gillani had talked to us before about a card that somebody had crossed out. When I crossed out mine, it looked like this, but that's not the card you're presenting here.
You said you have some sense of what lobbying is, but you aren't sure about how lobbying works. Really?
Yes. As far as an intermediary between someone who is looking for something from the government and the government, that is what I understand lobbying to be.
I think you have it.
When I look at this, I want to be clear on a couple of things. In your dealings with Mr. Jaffer, you said you had no connection to any staffer in the government.
There was no connection to the Prime Minister.
As I think of your relationship with Mr. Jaffer, it seems to me that if he was a lobbyist, he wasn't a particularly effective lobbyist.
I'm not here to pass judgment on that, but he certainly didn't arrange for funding for us, if that's what you mean.
That was what we had heard: we were going to get a term sheet.
I don't know if it came from him or if it was Mr. Gillani alone who provided me with that representation. To this day, we still don't know if it was an independent representation or if it was a discussion those two had before we received the e-mail.
Okay. I'll pass it over to Mr. Brown and he can have a couple of minutes, Mr. Chair.
Thank you, sir.
First of all, we've seen the evidence of the business card. We've read about this in the newspapers as well. But it is ridiculous—I just wanted to say that—that anyone would use a business card long after having been dismissed from that position and role. There was clearly some dishonesty at play. You were obviously a victim of it.
I want to know a little more about the $300,000 that was deposited on Mr. Gillani's advice. Are you completely out that $300,000?
Our management group made an investment in our company that was supposed to be used for the purpose of helping him to raise more funds on the back of a management group with skin in the game.
When it came time for us to request that the funds be delivered into the operations of the business, we faced some challenges, to say the least. The funds never made their way into our business. It's now a matter that's being dealt with by the authorities.
So I guess it would be fair to say that these individuals not only were good actors at professing to have lobbying contacts or the ability to have any access, but also, in terms of this venture capital, I'm sure you felt a bit swindled.
In retrospect, absolutely. We spent a lot of our time and effort trying to build a business with a pretty solid business model with a lot of people with experience and the need for retail outsourcing. And when it came down to us actually having to get the funding to operate our business, it came in dribs and drabs. Then by the end of May we were raising money on our own.
Are there any other examples of dishonesty or misrepresentations that took place with these individuals to you and your company?
With respect to Mr. Jaffer, nothing other than I had mentioned.
With respect to Mr. Gillani, in hindsight, sure. Yes, I'd say there were a number of misrepresentations. But it's going to be up to the authorities to determine whether they were innocent misrepresentations or whether they were akin to something a little more aligned with fraud.
Are there any examples of those misrepresentations you can share with us that may not already be...?
Thank you, Chair.
Thank you, Mr. Harvey.
I want to start with this business card. And I thank you for bringing it, because others have indicated they crossed out... I guess it was Mr. Jaffer who told us he had used that card because he forgot his normal cards or something, and crossed it out. Clearly that's not true.
Seeing as you were interested in getting access to federal government loans, what effect would it have on you when Mr. Jaffer actually produced a federal government or a parliamentary business card? Do you think he was trying to give you the impression that yes, he is connected to the source of that money?
My feeling I took away from that was yes, that was the case, that we were linked in with someone who could get us hooked up with government funding. Sure.
It might reinforce the impression that Gillani and he were trying to project that they would... Okay, very good.
I'm curious about the $300,000. Do you think Gillani saw that as part of his finder's fee, and was it ever expressed that way?
I have some information sent to us by Mr. Gillani recently, in anticipation of undermining your testimony here today. Mr. Garces is vice-president of HD Retail, or a partner?
Were you and part of your management team at a bachelor party for Mr. Dennis Garces that was held at Club Paradise and paid for in large part by Mr. Gillani?
I wasn't.
I went to a dinner for Mr. Gillani before, which Mr. Snowdy was also in attendance for, and we rode in and back together. We live close to each other, so it made sense for us to hitch a ride. So we went in and came back before midnight. I think the guys might have gone out after.
And have you seen photographs taken at that party by Mr. Garces, using Mr. Garces' cellphone, and later distributed by e-mail?
Yes, through the insolvency process it was actually one of Mr. Gillani's companies that purchased the assets.
Of the old family business. Claybrooke was also in the retail outsourcing business, more focused on logistics and in-store execution. We spent three years on the PROFIT 100. We had a wonderful run, and I guess you could say that we outgrew our capitalization. When it came down to it, we had one of our customers who decided they wanted to end the relationship and the bank followed suit. It ended actually fairly quickly, considering what we could have achieved with that business.
And are you now working for a business that in turn bought the assets of HD Retail following its bankruptcy?
Mr. Snowdy said he had been investigating Mr. Gillani for 19 months. Did you or Mr. Garces initiate hiring Mr. Snowdy to investigate Mr. Gillani?
For 19 months, that wouldn't have been possible for how long our business was actually even in existence. If there was someone who had hired him before, I'm not sure who that was. I was aware of his involvement about June or July 2009.
You're quoted as saying, “Rahim Jaffer said he was in front of a $100-million green fund.” That's a quote from a Toronto Star article.
Did you talk with him about this more than once?
There was a claim that you were coached. Because your initial instinct, which I think is probably correct, was that your business proposal probably wouldn't fit the normal criteria of this green infrastructure fund or green fund, were you not coached as to how you might craft the proposal so that it would fit in?
We never got to the point of a proposal per se. We were told that it would be a good idea if we touched on our green-related or environmentally friendly initiatives in retail. As I said before, the lighting, efficient utilization of energy, reducing carbon footprint, and efficient supply chain were the areas we had touched on in that meeting. They certainly weren't the bulk of our business plan, by any means; they were an auxiliary element to something that may qualify as far as funding goes.
On the $5 million, these are very specific details about the loan. It must have sounded plausible to you, to not just say “I think I can get you $5 million”, but “I think I can get it to you at this rate of interest, repayable under these terms”.
Yes. If he had just said, “I think a term sheet might show up next week”, that's a little different from the exact amount of money that we'd been looking for from the very beginning at a very attractive interest rate, repayable out of net profits. That's a dream for a business.
That's a sweet, sweet deal. In fact, it's a great f–ing deal, according to one e-mail that we saw here.
What role did you think Mr. Jaffer would play, though, in that? Would your company have worked through Green Power Generation Corp. to put that proposal together? Did you need consultation or consultant advice to craft a proposal in a way that it would qualify for the loan?
Frankly, we never got to that point. We hadn't talked about how it would be presented or anything like that.
So Jaffer showed up long enough to flash his parliamentary business card and add to the case that Gillani is connected to this green fund.
Was it Jaffer personally who said, “I'm in front of a $100-million green fund”?
That's really the nub of it, because even if you don't know much about lobbying—and ordinary people wouldn't—there's a fine line between lobbying and influence peddling. Selling your influence, as a public office holder, for a fee is a very serious criminal offence.
—or whatever, the actual words that were used suggested to me that he was in front. That was my recollection of how he had put it. I didn't have a tape recorder with me. I didn't, obviously, record word for word what he had said.
But that claim would have been backed up by this business card. It was a parliamentary business card.
Thank you, Mr. Martin.
The person who has presented the motion, Ms. Coady, wants to discuss the motion on Monday. So I am fine with continuing on with the round of questioning if everybody is agreeable.
Monsieur Guimond.
[Translation]
I have no objection to deferring the discussion of our colleague's motion to Monday. But I would still like to know, Madam Chair, whether we could take five minutes to talk about planning our future work.
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I am not sure if it will take five minutes, but I would like to make a comment about the future work.
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Thank you, Madam Chair.
Good afternoon, Mr. Harvey.
I would like to go to the part where Mr. Snowdy gets involved in this dilemma here. From what he told us, he had been hired by either you or your company, however you want to put it, to investigate Mr. Gillani. Why did you find it necessary to investigate Mr. Gillani to begin with?
We had been told on a few occasions that funding was imminent. It's coming; we're right there, we're so close. But we failed to get any delivery on any of that.
We got a little concerned as to whether we were going to see a public listing, whether we were going to see funding by a public raise, or private raise, for that matter. I'm not sure at what point Mr. Snowdy had started on behalf of his friend, but--
No, it wasn't on behalf of the company. We wanted to know, as individuals, what was happening to our business. We didn't sign an agreement with them or remunerate them, or anything like that.
When Mr. Snowdy came to you or to your colleague or your associate with the information he had collected on Mr. Gillani, what made you decide, or judge, that he should go and present this information to the Conservative Party's lawyer, Mr. Hamilton?
What alerted you to that? From what you've said so far, Mr. Jaffer had been, yes, showing a certain possibility of influence, but not outright saying he would open doors to government. So what made you think it would be appropriate for Mr. Snowdy to go and share whatever information he had collected on Mr. Gillani with the Conservative Party lawyer? Mr. Gillani had nothing to do with the Conservative Party.
--and he disclosed whatever he needed to, to the Conservative Party, to the Liberal Party, to the RCMP for that matter.
He never told me. I don't know what he had, outside of the stuff that was pertinent to our business. Anything that he had that was related to whether there was influence peddling... Outside of what we knew, there was nothing that he had information-wise that he shared with us.
But for you to direct him to whichever political party, you had to have had some idea that whatever he had found out would have an impact on government, on parliamentary business, so what did you find out? He must have told you something.
He didn't disclose what it is that he had, only that it could be incriminating toward people who were involved in government. I said, you know, if you feel it's appropriate, share it. It didn't have anything to do with our business, and frankly, we were so far down the road by April 8, by the time that article had come out, it didn't have any bearing on me. It was a quick conversation. He basically said, “Am I okay to go and share what I have with the government?” I said, “Sure. If it's a matter of national concern, then by all means.”
No, the matter at hand with Mr. Jaffer. The stuff with respect to Mr. Gillani, as I said before, I don't want to jeopardize anything that's ongoing there.
Because they were made aware that we were party to this representation, from what I understand. Again, I can't speak for them. The status of their investigation is probably something you'd want to inquire of them.
[Translation]
Thank you, Madam Chair.
Mr. Harvey, if I understand this correctly, the Jaffer, Glémaud and Gillani threesome, so to speak, managed to bring you to bankruptcy last December.
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This was one of a series of events. Again, I can't say anything about Mr. Glémaud. I've never met him in my life, so I don't know.
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You met Mr. Jaffer—we talked about it earlier, but it came up again—through Mr. Gillani. So you met with Mr. Gillani a dozen times. That is what you said earlier.
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You met with him a number of times, we'll stick to that. Could you say with conviction that Mr. Jaffer played a tangible role for your company, collaboratively or alone? Did he do anything for your company?
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Again, the question remains whether Mr. Gillani made that representation alone or whether he had been instructed by Mr. Jaffer as to terms and conditions we could expect. You can draw your own conclusion as a reasonable person as to who would be making that representation.
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He handed two out: one to you and one to your business partner. What did he say to you when he gave you this business card? Did he tell you that it was part of a collection, to add to your hockey card collection? Did he tell you it was a card that just happened to be in his pocket, or that it was a card with his contact information to reach him in order to do business together? Why did he give it to you? Was he overcome by nostalgia or by a burning desire to do business?
[English]
I don't know what the motivation was for providing that card to me, outside of... Again, it's draw your own conclusions whether it represented more influence than there really was or whether it was just that--I think it had been mentioned before--he ran out of his own business cards. I don't know.
I know what my impression was, but I can't speak to the reality of why he did that.
[Translation]
So nothing was said to accompany the action that confirmed that you could reach him at such and such a number, who he was, how he could get you in and what you could get done together. All because he had that card.
[English]
[Translation]
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He never said here's my business card and I'm the government, as far as you're concerned. There was nothing like that, no.
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Yes. For funding, sure there was, many times. But with respect to the matter at hand, there was just that one e-mail and a couple of follow-up calls where I had to ask, any news? And it was the same answer; it effectively ended up being no.
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When Mr. Gillani told you that he would follow up on funding, did he tell you that the follow-up meant going to the federal government to look for money?
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Did he say that he would go look for money for your company in existing federal government programs?
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Okay, Mr. Holder, you can start, and then when the bells ring, you'll be finished. We have to discuss committee business.
Thank you very much, Madam Chair.
Mr. Harvey, I'd like to come back to understanding the relationship with Mr. Snowdy.
My Cape Breton mom used to say that if it sounds too good to be true, then it likely isn't true. As I've heard you talk about your dozens of meetings with Mr. Gillani and what sounds like a single meeting that you had with Mr. Jaffer, it sounds as if there were promises made but not kept. Is that a fair assumption?
Coming back to some point when you ultimately engaged Mr. Snowdy, I want to clarify that matter, if I can. You indicated that you were aware of Mr. Snowdy's involvement in June or July of 2009.
I'm sorry to interrupt. This was for my business partner. He could have started with him earlier, but with respect to the lengthened term of his looking into the affairs, I only knew what I saw in the newspaper.
Would you clarify for me, because I want to be clear on this, whether Mr. Snowdy was a friend of yours for 20 years or a friend of your business partner?
Do you have any sense of who Mr. Snowdy was investigating prior to...who he was acting on behalf of at that time?
Yes, we hired him inasmuch as he had shared with me that he would offer to look into the affairs of what we were potentially being set up for. He also said he was familiar with some of the dealings of “these types of people”, as he put it.
So if you were aware in June or July that you actually were prepared to engage him, but you had business dealings with Mr. Gillani until December... Is that correct?
There was something, clearly, in the early summer that made you suspect or gave you great concerns, but you continued to have meetings and do business with Mr. Gillani. I'm a little confused by that.
Well, people weren't jumping out of the woodwork to fund our business, especially because we had an agreement in place with Mr. Gillani's company to take us public and raise funds for us. Our ability to terminate that agreement rested first of all on a time period that didn't expire until the fall, and then on other elements, which included the lack of delivery on the agreement itself.
Well, there must have been sufficient information from Mr. Snowdy that if, as you've indicated, it was a matter of national concern, you could go to the RCMP or go to a political party, whatever it might be.
There's a very big difference between going to the RCMP and going to a political party like the Liberal Party or the Conservative Party. That seems like a big swap.
But understand that when you talk about going to the authorities, this is no disrespect to the Liberals, Conservatives, or for that matter the NDP or the Bloc, but they're not considered the authorities.
But if that were the case, if there were such grave concerns, I'm confused by this stretch. I understand going to the... You've indicated here that the RCMP has an ongoing investigation with Mr. Jaffer.
Well, let's come back again, because I find this a little confusing. Let's come back again.
The RCMP, you've indicated, were investigating Mr. Jaffer.
All right.
So with that, when Mr. Snowdy said that he had matters of grave concern—and he told you no details of them, but he said they were of grave concern—then you said to take it to wherever he needed to take it, and you mentioned parties and you mentioned the RCMP.
Any matters outside of what I previously said were matters of information that I would exchange with them and whether they opened up a further investigation were entirely with them.
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