Brian Mulroney is one of most well known of Canada's politicians. He was the eighteenth Prime Minister of Canada from September 17, 1984, to June 25, 1993 as a leader of the Progressive Conservative Party of Canada which he headed from 1983 to 1993. After retiring from politics, Mulroney returned to private life as a lawyer and business consultant.
He came from the inside track of Canadian politics and wheeled and dealt his way to the top. In those perhaps little more relaxed political days, he had all kinds of friends and of course enemies. A few were both. One was Karl Heinz Schreiber, a German influence peddler and arms dealer who turned his background of intelligence work, business and a friendship with a wide circle of political and business heavyweights into a highly profitable business. He was active in his native Germany where he was responsible for destroying the reputation of the highly successful German conservative PM Helmut Kohl.
Mulroney was known for having wealthy friends. He was very business friendly and both courted each other. By the time he left office rumors were already floating about his possible kickbacks. His Conservative Party was replaced by the Liberal Party who did their best to make such charges stick. The link with Schreiber was not exactly a secret and nor that he was involved with the contract granting to airplane supply company Airbus in lieu of bribes.
An investigation was initiated but it failed to produce any significant evidence. The government said the charges could not be substantiated. The investigating agency, the Royal Canadian Mounted Police, apologised and its chief investigator on the case resigned a year later. The government later dropped the investigation entirely. In fact, as a result of failing to press charges, Mulroney in 1997, received an apology from the Government of Canada. He also received a $2.1 million reimbursement of legal and public relations costs of a lawsuit he had launched in 1995 after charges were made.
Payments
Various Canadian media are now reporting that a key fact was unknown in 1997. That Mulroney had accepted $300,000 in cash from Schreiber , the German-Canadian businessman who had been a middleman for Airbus. It appears, the cash changed hands in three meetings. The payments occurred over an 18-month period, beginning in 1993 when Mulroney had stepped down as Prime Minister but was still a member of Parliament.
Schreiber had at his disposal $20 million from Airbus for the payment of secret commissions. Canadian Broadcasting Corporation Television reported on February 8, 2006 that the money Schreiber paid to Mulroney originated in a Swiss bank account code-named "Frankfurt" which Schreiber also used to pay the secret Airbus commissions. $500,000 was transferred from "Frankfurt" to an account in Zürich code-named "BRITAN" on July 26, 1993, from which withdrawals totalling $300,000 were made in 1993-4.
There is no evidence that Mulroney was aware of the source of the Schreiber cash. Nor is there any evidence that Mulroney accepted bribes in the Airbus affair. But this is where the matter becomes murky. Nobody knew about the payment or the protocol for a long time.
For many years, Mulroney did not acknowledge receiving money from Schreiber. The payments were not disclosed in Mulroney's 1995 lawsuit against the Government of Canada. Mulroney testified under oath that he "never had any dealings" with Schreiber, knew him only "peripherally" and they had a cup of coffee "once or twice." According to the February 2006 CBC story: "In 1999, a spokesman for Mulroney denied any money was exchanged. But in 2003, Mulroney indirectly acknowledged he did receive money from Schreiber but as payment for his help in promoting Schreiber's pasta business." In his 2004 book A Secret Trial, former law professor William Kaplan describes Mulroney's testimony as evasive, incomplete and misleading -- but concludes that it did not rise to the level of perjury.
Mulroney said he was "as clean as a whistle" in accepting the payment because he declared the money and paid tax on it. But in October 2007, CBC News and Toronto based newspaper the 'Globe and the Mail' revealed that Mulroney had not paid the tax during the years in which he received the Schreiber money -- but had done so later, after making a voluntary disclosure to Canadian tax authorities. Five years after the payments began, Mulroney and Schreiber met again in a hotel, the Hotel Savoy in Zurich. Schreiber claims Mulroney tried to extract a promise: Schreiber would never reveal the payments. Schreiber also claims Mulroney's attorneys later tried to induce him into perjury by asking that he sign an affidavit falsely stating that he had never paid any money to Mulroney.
New allegations by briber Karl Schreiber
In court papers filed in November 2007, Schreiber made a new allegation. He claimed he had met with Mulroney two days before Mulroney left office as Prime Minister to set up the $300,000 payments. Mulroney called for a full public inquiry. Prime Minister Stephen Harper agreed after refusing to do so and accusing the opposition Liberal Party of seeking political revenge. He was forced to appoint David Lloyd Johnston, President of the University of Waterloo, to advise on the terms of reference for the inquiry; Johnston will report by January 11, 2008.
Meanwhile, under pressure from media late this year, Harper denied discussing Schreiber with Mulroney in 2006. PM Harper also denied seeing letters written by Schreiber to both him and Mulroney. Harper said it would be inappropriate for him or other Conservative politicians to have any contact with Mulroney until the matter is resolved. The RCMP is also examining the new Schreiber allegations, and will open a review.
Mulroney supporters question Schreiber's credibility, pointing out he has changed his story many times over the years. In 2006, Schreiber wrote a letter to Mulroney that appeared to exonerate the former Prime Minister. Schreiber is currently incarcerated in Canada. After an eight-year legal battle, Schreiber is awaiting extradition to Germany, where he is at the centre of an old bribery scandal that helped bring down a government and damaged the legacy of Conservative Chancellor Helmut Kohl. Now Schreiber's extradition may be delayed by the public inquiry, something he must be enjoying.
But as people dig into the murky affair, facts are floating up that makes Brian Mulroney, something less than a paragon of virtue and a man given to habitual truth telling. He has held that he needed the money to make the transition to private life because he had little except his pension of around 33,000 dollars a year but that doesn't bear out by facts. In fact, in his post - PM life he was about to become a very wealthy man.
Taking money a mistake says Mulroney aide
Throughout his tenure as the Prime Minister, Mulroney had cultivated close friendships with top executives in Canada and United States, as well as with conservative political leaders such as President Ronald Reagan and his successor, George Bush, practically guaranteeing a high status and income in the corporate world.
"Within months of leaving office on June 25, 1993, Mulroney was welcomed onto the boards of large Fortune 500 companies. As well, he quickly began earning top dollar for speaking engagements and had accepted a lucrative partnership at a prominent Montreal law firm that insiders estimate pays him at least $1 million a year." (Can West News service Nov, 2007)
Mulroney's spokesman Luc Lavoie added to the absurd explanations emerging from Mulroney's camp by saying that because Mulroney was "not a rich man", he had made the "colossal mistake" of accepting the $300,000 in cash from Schreiber, the German-Canadian businessman who faces extradition to Germany on charges of tax evasion and bribery.
Mulroney story has also been changing. He originally said he fully declared the money to tax collectors. Later he said that only after he settled a $50 million lawsuit with the federal government over bribery allegations in the Airbus scandal in 1997 did he file a voluntary tax disclosure.
Schreiber has been at the eye of a storm since 1989 over allegations that he paid at least $5 million in bribes to Mulroney for the purchase in 1985 by Air Canada of 34 Airbus planes.The deal was worth $1.8 billion. Airbus paid Schreiber's Liechtenstein company, International Aircraft Leasing (IAL), $8.8 million as a commission. That same year the German company Messerschmitt-Bolkow-Blohm (MBB) paid IAL $1,122,072 for the sale of 12 helicopters to the Canadian Coast Guard.
It has never been clear what work Schreiber did for Airbus or MBB to obtain his commissions. Mulroney has always denied receiving money for the deals and an RCMP investigation found no evidence of wrongdoing on his part.
Why, where and when?
But Schreiber's cash payments to the former PM still raise questions that both a parliamentary ethics committee and a government commission are set to investigate. Recently the committee summoned Schreiber from his Toronto jail cell, where he is awaiting extradition, to testify on the Mulroney payments. Mulroney is expected to testify next month.
Mulroney accepted the first cash payment of $100,000 after he left office but while he was still MP. Schreiber has stated he gave Mulroney the cash on Aug. 27, 1993, during a stopover at Mirabel Airport. Mulroney came to the airport to pick up the money. Schreiber claims he made the second payment four months later on Dec. 18 at the Queen Elizabeth Hotel in Montreal, and the third and final payment a year later on Dec. 8, 1994, at the Pierre Hotel in New York. Schreiber is suing Mulroney for return of the money, claiming Mulroney did no work for it.
Mulroney says the money was a retainer for representing Schreiber on a venture to market pasta machines and on a project to build a military vehicle plant in Montreal, which was never built. Mulroney has spent about $1 million renovating his home which he had purchased in 1993 for $1.68 million with a mortgage of $1.26 million. Mortgage payments would have cost him about $10,000 a month.
There was never a clear public record of how much money Mulroney had when he left office. Senator David Angus was quoted at the time saying Mulroney was "a millionaire." Angus did not return phone calls.
According to Stevie Cameron's book On The Take, industry leaders raised about $4 million for him to help finance the purchase and renovations of his Westmount home. Mulroney has never denied this. Mulroney's secretary said he was out of town and unavailable for comment.
Who is this Karl Heinz Schreiber?
Karl Heinz Schreiber is a 74-year old German- Canadian lobbyist, fundraiser, arms dealer, and man of all trades including shady ones. His claim to fame or infamy are many but his role in the 1999 funding scandal of Christian Democratic Union party tarnished the conservative cacucaus and their leader Helmut Kohl.
Schreiber is an old recruit of the german intelligence where he learnt the shady trades. He was a fundraiser for the Christian Democratic Party and Christian Social Union which together became the CDU before and during Kohl's reign.
One could always trust him to take care of his walthy friends and his money for a fee. He set up trust accounts in Canada for wealthy Germans in the early 1980s; among the people he served was Franz Strauss, Premier of Bavaria, as reported by Steve Cameron in his book On The Take (1994) which desctribed the scandals of Mulroney.
Since 1999, the Canadian citizen Schreiber has fought extradition to his native Germany, where he is wanted on allegations of fraud, bribery and failure to pay $20 million in taxes to the German government on commissions related to sales of Airbus jets. In October 2007, it looked like, Schreiber had apparently outlasted all avenues to stop his extradition to Germany but his lawyers managed to stay the order.
On November 15, 2007, Schreiber lost his extradition appeal and remains confined in the Toronto area pending further developments. Reports say that the government would wait at least 15 days before extraditing Schreiber to Germany. However, Schreiber has vowed that he would not cooperate with the public inquiry if he was extradited. Canadian authorities said that that Schreiber would have to cooperate with the inquiry, regardless of circumstances.
Canadian politics and the case
People think that the Canadian government should serve the interest of the proposed public inquiry and delay Schreiber's extradition to allow him to testify. However, it is becoming clear that the governing Conservative Party, as well as key elements within the opposition Liberal Party, do not want Schreiber to testify, and instead want him to be extradited to Germany. "On November 21, 2007, the website ctv.ca reported that the Canadian House of Commons Ethics Committee has struck a deal to hear testimony from Schreiber as soon as possible, possibly in advance of any possible extradition. Opposition party members outnumber the governing Conservative Party members on this committee.
On November 23, 2007, it was reported that the Commons Ethics Committee wants to summon Schreiber to testify before it on November 27 and 29. For this to occur, Schreiber would have to be released from jail in Toronto and travel to Ottowa, Canada's capital.
Schreiber stated that if he testifies, he wants bail, wishes to wear a business suit and not his prison jumpsuit, and would like time to study his files, which are stored at his house in Ottawa. Schreiber has also stated that the German government may have obtained information from his Swiss bank accounts through Swiss authorities, without following proper procedures, and plans to use this as grounds for appealing his extradition. Brian Mulroney would then appear before the Ethics Committee in the week following Schreiber's testimony, if it occurs.
The drama is still on and one can't say that the decade old inter-country saga is over by any means.
(Afsan Chowdhury, former acting editor of
Dhaka Courier, writes from Canada) |