McGill hospital project suspected of corruption

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McGill hospital project suspected of corruption
Patrick McDonagh 14 October 2012 Issue No:243
Source: University World News

On 18 September, the McGill University Health Centre issued a terse statement: it confirmed that at 08h00, 12 officers of Quebec’s Unité permanente anti-corruption had raided its offices as part of a wide-ranging investigation into corruption in the province’s construction industry.

The officers were seeking information on the bidding process for the health centre’s new ‘super-hospital’: specifically, they sought evidence of a possible CA$22.5 million (US$23 million) kickback paid by the consortium winning the tender to build the facility.


Some background is necessary.

The McGill University Health Centre (MUHC) is an entity comprising McGill University and its network of teaching hospitals. The new CA$1.3 billion facility, to be located close to downtown Montreal in a former rail yard, will serve both the teaching and research needs of the faculties of medicine and dentistry.

When bids were finally accepted in 2010, the Groupe Immobilier Santé McGill consortium, led by Montreal-based engineering giant SNC-Lavalin along with UK-based Innisfree Ltd, beat one other competitor to win the right to design and build the super-hospital, and to operate it for the next 30 years.

It was a lucrative victory, as the new hospital is one of the largest construction projects currently under way in North America.

Construction industry corruption

But the building industry in Quebec is fraught with difficulties.

In May 2012 the Quebec government established an inquiry, led by Quebec Superior Court Justice France Charbonneau, to investigate corruption in the province’s construction industry; the commission turned up evidence of numerous industry connections to organised crime and of municipal contracts awarded with kickbacks to a number of high-ranking political figures in Quebec.

The investigation into SNC-Lavalin’s activities is part of this broader sweep, and the scandal resulting from the discovery that the company had paid out CA$56 million in kickbacks on various projects has resulted in the resignation of its CEO and the abrupt departures of two other senior executives.

The raid on the MUHC office was part of the Charbonneau commission’s investigation. The details were uncovered two weeks later, when a report in Montreal’s La Presse newspaper on 1 October asserted that SNC-Lavalin kicked back CA$22.5 million to ensure that theirs was the winning bid.

In the days since then, little new information has emerged.

MUHC former CEO disappears

However, much attention has focused on the departure and disappearance of the MUHC’s previously high-profile CEO Arthur Porter last December, a full four months before the end of his mandate; he had held the position since February 2004.

Porter had preceded his MUHC resignation with another newsworthy departure. On 9 November, almost a month before leaving the MUHC, he quit his position as chair of Canada’s Security and Intelligence Review Committee when word leaked of his business dealings with Ari Ben-Maneshe, a Montreal-based international lobbyist who has acted in negotiations between the Russian Federation and developing countries.

Ben-Maneshe’s name has also been connected to the international arms trade, and he is known to have had dealings with Zimbabwe’s President Robert Mugabe. Porter had paid Ben-Maneshe CA$200,000 in the hope of acquiring CA$120 million worth of Russian funding for infrastructure development in Sierra Leone, where Porter and his family have mining interests.

So less than a month after resigning as the watchdog of Canada’s spy agency, Porter also left as CEO of the MUHC. “Having presented a vision of the future to the board, it’s now an appropriate time for me to move on,” he said on 5 December 2011. Neither he nor McGill mentioned the conflict of interest at the time.

Today, however, many – including members of Unité permanente anti-corruption (UPAC) and Surété Québec, the provincial police force – are wondering what connection, if any, Porter might have to the CA$22.5 million alleged to have been paid by SNC-Lavalin to the MUHC.

But they cannot find him. According to an internet search, Porter is currently managing director of the Cancer Centre Bahamas (whose website still lists him as CEO of MUHC), and is involved in the establishment of another centre in the Turks and Caicos. But the man himself has remained elusive.

MUHC tight-lipped

Meanwhile, MUHC confirmed Normand Rinfret, who had been acting as interim CEO, as MUHC’s new leader on 4 September. The raid on the MUHC offices took place a mere two weeks into his mandate.

In a 25 September letter to MUHC employees, Rinfret called for cooperation with the investigations and asked employees to share any information they might have. He also noted that the process of awarding the contract had been managed through a government agency, Infrastructure Québec.

The letter, as reported in La Presse, did not note that Infrastructure Québec was also subject to the same police sweep on 18 September.

Throughout, the MUHC has remained tightlipped. The press release remains its only formal statement, one that concludes by noting that all further media requests should be directed to UPAC, the organisation that raided their offices.