Railgate: The Kinsella Connection
Before BC Rail deal was sealed, Campbell huddled with CN Rail chair McLean, fixer Kinsella.
Robert Virk and David Basi.
Defence lawyers in the B.C. Legislature raid case made a bombshell allegation Thursday that Premier Gordon Campbell met with BC Liberal 2001 election campaign co-chair Patrick Kinsella and David McLean, CN Rail's chair, to discuss the $1 billion BC Rail deal before CN was announced the winning bidder.
Reading from a briefing note seized by police search warrant from Pilothouse Public Affairs, lobbyists for CN rival OmniTRAX, lawyer Kevin McCullough talked about problems CN might face with tax implications of the deal.
"This was disclosed face to face with the premier, David McLean and CN's B.C. political advisor Patrick Kinsella," McCullough quoted the document.
"The premier never wavered, even from the last election, from his intent to sell B.C. Rail," McCullough read. "Conscious of his tenuous political situation post-Maui [where he was jailed for drunk driving in early January 2003] he assured northern communities the province would retain track ownership."
But, McCullough said, this promise meant CN could not take full advantage of tax credits.
Kinsella said to be working both sides
McCullough, reading from other e-mails and documents disclosed to the defence in the case of three former government aides facing corruption charges, also alleged that Kinsella was working for both CN Rail and BC Rail in the period prior to and during the sale of BC Rail to CN. Kinsella was paid $297,000 by BC Rail during that time.
McCullough said the BC Rail deal almost collapsed months after it was signed November 25, 2003 -- leading to a May 19, 2004, intervention by Kinsella to Campbell's chief of staff Martyn Brown at McLean's request.
"On the 19th of May [2004] Kinsella is the point man for CN, he calls Martyn Brown to say they have to do anything they can," McCullough said.
Stifling of FOI request alleged
And McCullough, representing former ministerial aide Bob Virk, alleged in court that senior government Deputy Minister Chris Trumpy and then-BC Rail vice-president Kevin Mahoney worked together to "stifle" a freedom of information request to access the transaction documents in the BC Rail deal.
The B.C. Liberal government is exercising "sub judice" -- that the matter is before the courts -- to avoid questions when it is convenient but ignores it for its own purposes other times, McCullough also told Justice Elizabeth Bennett.
Special prosecutor Janet Winteringham objected to McCullough's argument on sub judice but Bennett cut her off, saying: "I'm not sure your role and function here -- you're the special prosecutor."
"There's a reason special prosecutors are appointed," Bennett concluded, no doubt referring to their role as being outside politics in prosecuting cases involving political figures.
Libs duck questions in Leg
B.C. Liberal house leader Mike De Jong refused in the legislature Thursday afternoon to answer opposition questions about the revelations.
"The honourable member chooses to make allegations that derive directly from information and material that are squarely before proceedings at the Supreme Court of British Columbia. It is, therefore, inappropriate to answer," De Jong said in response to a question from NDP MLA Mike Farnworth.
The opposition used its entire question period to pepper the government with the allegations raised in court but neither Premier Gordon Campbell nor Attorney General Wally Oppal were present for them, leaving De Jong to take them all.
Defence calls Kinsella 'critical link'
Outside the court, NDP MLA Leonard Krog was scathing about the information disclosed.
"This deal was going off the rails and the so-called 'consolation prize' becomes much clearer," Krog said, referring to the defence theory that OmniTRAX, the only bidder left in the sale other than CN, was offered a consolation prize of BC Rail's $70 million Roberts Bank port subdivision.
That privatization was cancelled in March 2004 when police informed the government the process was tainted.
Krog also said in relation to the main BC Rail deal that: "The premier's right hand, political advisor and old friend Patrick Kinsella is there working both sides of the streets."
Outside court, defence lawyer Michael Bolton, representing former ministerial aide David Basi, said Kinsella was a critical link in the privatization of BC Rail.
What Is the B.C. Legislature Raid Case?
Also known as "Basi-Virk," or "Railgate," it stems from an unprecedented search of the B.C. legislature on Dec. 28, 2003, that police at the time ominously linked to drug dealing, organized crime and corruption said to extend to the highest levels of government.
Subsequently, it became clear the search was in fact connected to the $1 billion privatization of BC Rail by BC Liberal Premier Gordon Campbell.
Two former ministerial aides -- David Basi and Bob Virk -- now face charges of breach of trust and fraud for allegedly passing confidential government documents on to lobbyists representing OmniTRAX, one of the corporations that bid for BC Rail. Aneal Basi, a former government communications aide and cousin to David Basi, faces money laundering charges.
The case has exposed the extensive political connections between the B.C. and federal Liberal parties, provincial lobbyists, the leadership campaign of former Liberal prime minister Paul Martin and even the RCMP.
The B.C. legislature raid case is currently in the pre-trial defence application stage at B.C. Supreme Court. The trial itself is expected to last six months or more and call dozens of witnesses, including powerful former B.C. Liberal cabinet ministers, political staff, lobbyists and many others.
-- Bill Tieleman
"What we have indicates that Mr. Kinsella was a very pivotal person in the BC Rail deal," Bolton said. "Material today indicates he was doing work for CN and BC Rail."
Leery about Sun's Vaughn Palmer
McCullough also read e-mails obtained in disclosure of evidence between BC Rail executives and top government officials.
One e-mail dated July 7, 2004, concerned a column written by Vancouver Sun columnist Vaughn Palmer about possible problems with the BC Rail sale to CN running into problems.
The e-mail was from BC Rail VP Kevin Mahoney to Deputy Minister Chris Trumpy, who was a government appointee to the BC Rail deal evaluation committee.
"Mr. Vaughn Palmer of the Vancouver Sun had written an article that contained what appeared to be confidential information -- that he wouldn't otherwise know," McCullough said, going on to read the e-mail into the record.
"Subject: Palmer. Mahoney: Where does Palmer get his stuff?"
Trumpy replied 36 minutes later, McCullough said.
"Trumpy: What is your phone number now?"
"Mahoney: The old one will get you here but the new number is 678-4748."
McCullough suggested that response was designed to make sure the conversation about Palmer's source of information was not in e-mails that could be later accessed.
"The defence says 2 + 2 = 4," McCullough said. "The article is about whether the BC Rail deal is in trouble."
"One of the issues in this case important to the defence is that one of the allegations is that the accused were leaking things," McCullough said. "Leaking is how the government controls its political agenda. This isn't an individual rogue act -- it's systemic, it's part of the plan."
Related Tyee stories:
- How Gordon Campbell's Policies Made a Rich Friend Far Richer
Longtime Campbell ally David McLean chairs CN Rail and owns a film studio. BC Liberal decisions helped those firms reap hundreds of millions of dollars. - Railgate, A to Z
Five years after the legislature raid, a who's who guide to BC's biggest political scandal. - Railgate Bombshell: BC Gov't Ethics Scorched by Rail Firms
Angry bidders 'dismayed' by 'unfair' process in $1 billion privatization
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Grumpy
27-03-2009
Just wait .............
........ until this court case collapses. The ruling elite just can't have scandal and if one listens to CORUS radio, the host and two well known media types pooh-poohed the whole Kinsella-Campbell-BC Rail affair.
AND THEY CALL THEMSELVES REPORTERS?
Hearken back to days of old, when a hapless NDP Premier was though to have a new sun-deck installed for a political favour. My the wages of sin have increased from a new sun-deck to a railway!
It seems in BC, the rule of law is no more and it is a one man show, an autocracy of the worst order. Isn't time for a palace coup? Is there no one in the Liberal party that is not afraid to "bell the cat?"
G West
27-03-2009
More to come
There may well be other shoes to drop grumpy - ones that have little to do with Basi and Virk and a lot to do with players in the Premier's Office - the timing, will be everything.
I expect that the watercarriers are going to find there are some big holes in their buckets!
frenchy mcswede
27-03-2009
More good work from bill tieleman.
Patrick kinsella and ken dobell, now there's a matched pair. Perhaps the entire campbell government should be declared one vast conflict of interest and disolved by the courts. There is an interesting point made by Victoria Times colonist article on the latest bc rail news: that campbell was essentially between a rock and a hard place in that he needed "a balanced budget" for the 2005 election, therefore he had to act in haste and was in a totally weak bargaining position with CN Rail. More pathetic BC liberal "economic management." What will campbell sell or finish selling next time he's broke -bc hydro, icbc, the rest of our health care system?
There is also some interesting interplay in the comments section of the times-colonist article in which bc liberal supporters attempt to defend campbell's economic record, but get trashed badly. Cheers!
dgiVista.org
27-03-2009
Campbell Out of a Job
Campbell's goal of delaying trial past the 2009 election looks like a failure.
The next month will be thrilling.
We should also remember all the cabinet ministers who chose to not run for re-election in 2005. Keep your ears open for them being implicated in this mess as it explodes all over the neoLiberals.
verso
27-03-2009
Thanks...
... Tyee, Bill Tieleman and BC Mary for all the work you've done on this file.
Seems to me, the main reason this scandal is getting any play in the dallies and on the airwaves (as little as it does) is because of the heavy lifting done by those I mention above. I'm sure the Tyee readership has also given the MSM an earful for it's rather anemic response to this story (and others). I don't doubt for a second that Canwest has taken notice of the Tyee's presence and the forum it provides this market . It may partly explain why Vaughn now has a blog that actually allows comments because I don't believe his columns ever did.
Perhaps I'm overstating the Tyee's influence but could you imagine this market without the internet?
Dan the socialist
27-03-2009
Is Global owned by Gordon
Is Global owned by Gordon Campbell? I watched their morning news and now noon news just to if they would report this and no mention at all. Pretty pathetic.
BC Mary
27-03-2009
Thanks right back at you, verso
and among the many who deserve thanks, we should add Robin Mathews who attends most of the court sessions and reports with honesty and clarity (and without fee) to several web-sites including mine.
There's also Pacific Gazette, Laila Yuile, House of Infamy, How Bad Is The Record and others.
Justice in a free society shouldn't require this much hard work. But when the issues are embodied in a big train once called BC Rail, it's a compelling task.
Sometimes when I'm really tired, I imagine all of us loaded into that train for its first journey north from Vancouver under its proper name: BC Rail. I can almost hear that train whistle echoing off the canyon walls. What a party that would be ... a non-partisan, happy-face, tall-tale-telling party. Silly, eh? Well, all great things begin with a dream.
Kind words like yours, verso, keep the wheels turning.
http://bctrialofbasi-virk.blogspot.com/
Tom Hawthorn
27-03-2009
Further reading
More excellent reporting by Bill Tieleman.
I'd also like to direct Tyee readers to the Globe's coverage this morning. The story, by Mark Hume and Justine Hunter, is the top story on the front page of the B.C. edition under the headline: Campbell's office had BC Rail link, court told
You can find it online at:
http://tinyurl.com/de86fm
The Globe is at www.theglobeandmail.com
Cynic
27-03-2009
Bravo, Bill et al. Always
Bravo, Bill et al. Always great to see a slice of the corruption that rules us exposed. I hate to think of all the systemic government crime we're unaware of. And thank gawd we have the internet to help us help ourselves, do we ever need it. The msm conjures such a fantasy theatre; it's scary so many of us buy into it.
doggone
27-03-2009
Do any of these people imagine
They are useful?
The waves of information make me sea sick.
I used up my life building shelter: Houses, workshops and recreational dwellings. I'm not claiming that as admirable - but it is not a negative drain!
This muddle reads as if the people concerned are Lampreys or other forms of "suckers" living off the life blood of their prey.
Hopefully the "economic downturn" will simply starve this organism out of existance
BC Mary
28-03-2009
It's the NDP's fault. An election ploy.
I had a hysterical chuckle today while reading the Times Colonist. This came right after Les Leyne ...
Their editorial sounded all huffy because the Loyal Opposition has been asking awkward questions about Patrick Kinsella during QUESTION PERIOD.
It's an election ploy, said the TC editorial. The New Democrats just want to make trouble.
After a while, I got it. Problem solved.
It's the NDP who sold BC Rail !! This whole scandal is the NDP's fault !! And talking about it is part of an election campaign strategy !!
Sheesh. Problem solved. So just move along, folks ... ain't nuthin' happenin' here ...
RickW
28-03-2009
BC Mary
Ya know, if the NDP hadn't begun the whole thing by suggesting we host the 2010 Fun 'n' Games, there wqouldn't be any Liberal scandals and corruption happening. So you are right -- it's the NDP's fault........... :~)
frenchy mcswede
28-03-2009
There has been some media coverage,
especially in recent province michael smyth columns, which can be accessed from the times colonist by the "newspapers" mini dialogue box near the top of the page. Comments are running at least 3 to 1 against campbell, and some posts have been quite eloquent. I myself, have been using the opportunity to comment as frequently as possible on both the topic and what lousy economic managers the liberals are.
Please understand I hold the tyee to be definitely the best and fairest place to post and debate, but for the purposes of winning the election I am trying to post in as many venues as possible. With the liberals having way more dollars than the ndp, if enough articulate posters do what I'm doing it could help defeat campbell. Canwest no longer even asks for an email adress. There's also the straight. com and the cbc thread on the rescinding of the gag law, where comments have been running at least 8 to 1 against campbell in a field of over a hundred comments.