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Hung out to Dry
Basi and Virk are guilty of being pawns in a much bigger game that others won.
Robert Virk and David Basi: Rosencrantz and Guildenstern?
-
Railgate, A to Z
Five years after the legislature raid, a who's who guide to BC's biggest political scandal.
-
New Dems Want Inquiry into Basi-Virk Plea Bargain
Judge accepts surprise guilty plea in political corruption trial of ex-BC Liberal aides.
-
Sudden Basi-Virk trial ending will be costly for taxpayers – and BC Liberals
"Tell him his commandment is fulfill'd,
That Rosencrantz and Guildenstern are dead:
Where should we have our thanks?"
-- William Shakespeare, Hamlet: Act IV, Scene 2
David Basi and Bob Virk are guilty alright -- guilty of being unwitting pawns in a much bigger chess game where all the other players came out winners.
Former BC Liberal ministerial aides Basi and Virk do not deserve to spend a single day under house arrest, let alone the two years less a day they were sentenced to last week under a guilty plea bargain agreement admitting to reduced breach of trust and fraud changes for leaking confidential government information on the sale of B.C. Rail to lobbyists for a bidder.
Like the ill-fated Rosencrantz and Guildenstern -- a pair of minor actors working for the corrupt King Claudius who are sent off unsuspectingly to their deaths by the scheming Danish prince Hamlet -- Basi and Virk were simply hung out to dry after police raided the B.C. legislature on Dec. 28, 2003.
At the heart, this case is about Premier Gordon Campbell and BC Liberal MLAs breaking their 2001 promise to voters not to sell publicly owned B.C. Rail.
The real breach of trust was a political one that came from the premier and his government, who committed it against British Columbians who expected and deserved better.
What the case was about
This case is about selling a profitable railroad serving the public to CN Rail, a company that has contributed over $300,000 to the BC Liberal Party since 1994 and whose chairman, David McLean, is a close personal friend and long-time backer of Campbell.
Basi-Virk is about two different reputable rail companies -- Canadian Pacific and Burlington Northern Santa Fe -- dropping out of the B.C. Rail bidding process because they said it featured a "lack of fairness" and was "fundamentally flawed" with "blatant favouritism" shown to the successful bidder CN.
Basi-Virk is about the astonishing disregard for good judgment repeatedly demonstrated by the RCMP. Lead investigator superintendent Kevin DeBruyckere continued on through the case despite disclosing to the force early on that his brother-in-law is BC Liberal Party executive director Kelly Reichert.
RCMP officer Andrew Cowan, another key investigator, actually had bought a house from David Basi's own mother a few years before the raid and had direct dealings about it with Basi himself yet also stayed on the case.
RCMP notes titled "Kelly Reichert -- Do Not Disclose" that the defence obtained through tenacious court action alleged that Reichert was briefed by officers on key aspects of the case, which he allegedly passed on to Campbell.
According to Virk's lawyer Kevin McCullough, reading from the RCMP document, Reichert was even asked if additional charges against Basi should be pursued or whether that would be "outweighed by the harm of embarrassment" to the BC Liberal Party. But because the trial ended, none of those documents were ever filed in court and remain unproven allegations.
Forget the noise being made in the media and opposition about the government giving up any chance to recover the $6 million in legal fees the province already paid Basi and Virk's lawyers by not taking away Basi's house and garnisheeing their future wages.
Those legal fees are mere chump change compared to what British Columbia lost in the $1 billion B.C. Rail privatization that still lies at the dead centre of this travesty.
B.C. Rail produced net profits in 18 of the 21 years between 1980 and 2000 and in all the three years it didn't the reason for losses was due to "special charges" against the railway, as The Tyee's Will McMartin ably pointed out.
That meant B.C. Rail contributed $137.8 million to the provincial treasury but Campbell's chief of staff Martyn Brown maintained in testimony June 10 that he was "not aware" of that.
"I'm aware of the problems they were having... My understanding was they were saddled with debts, saddled with costs," Brown swore.
Media quick to close the book
Disregard media claims that a case which began publicly with a police raid on the B.C. legislature on Dec. 28, 2003 was merely a "grubby little episode" where the guilty confessed to being "small-time shakedown artists" -- conclusions drawn by two pundits who together spent less time observing proceedings in B.C. supreme court over five years than Campbell's chief of staff Martyn Brown did in his short testimony this spring as the first of only two witnesses.
Ignore Premier Gordon Campbell last week oozing disdain for Basi and Virk, calling them "criminals" and saying they only have themselves to blame.
"Two people acted on their own and acted criminally. And I think unfortunately for seven years they've claimed innocence, and their lawyers have pretended that they were innocent when they knew they were guilty," Campbell told reporters. "They dragged their families through this for seven years."
It's a little tough to take this premier expressing real concern for anyone's family when his province has the highest child poverty rate for those same seven years running.
And if Basi and Virk "acted on their own," then why did Campbell and attorney general Mike de Jong both instantly reject calls from the NDP opposition and media for a public inquiry, saying it would be a waste of money when justice has run its course?
They couldn't have anything to fear in that case.
Or could they?
Pressures on the defendants
First -- consider why the two aides might have made the guilty plea bargain.
Basi was fired from his well-paid government job as ministerial aide to then-finance minister Gary Collins nearly seven years ago, Virk as ministerial aide to then-transportation minister Judith Reid almost six years ago.
Basi and Virk each have a wife and two young children. Neither has earned any significant income since then, doing odd jobs and receiving financial support from their families.
Had the trial continued through to April 2011 as planned, they would have been dealing with this case for eight years before resolution.
If found guilty by a jury on multiple breach of trust and fraud charges they faced a jail term of up to five years, plus responsibility for their legal fees that were already $3 million each -- with six months of trial to go -- plus potential fines.
Both men would have faced personal bankruptcy and in Basi's case, loss of his family home. Basi also faced additional charges -- to which he also pled guilty -- of breach of trust in receiving $50,000 from Victoria development company Shambrook Hills for help getting land removed from the Agricultural Land Reserve. He has been fined $75,695 in total in both case, representing all the money he wrongly received.
How many people would gamble everything they own, risk five years in jail and ensure their family was reduced to poverty -- after already living through seven hard years of limbo?
Especially when your alternative to disaster is two years less a day house arrest, multi-million legal fees paid off and the ability to work while living with your family.
Under that kind of extended, excruciating financial and psychological pressure, it's hardly surprising Basi and Virk took the deal.
And it also explains Basi's post-sentencing statement that: "I want my kids to know that their dad had integrity, that their dad does sleep with a clear conscience at night. I know some people who don't, I'll tell you that much, and they're very relieved today."
One could argue that Basi is merely another guilty criminal spinning a self-serving story. But why would he bother to go to those lengths and dare talk about integrity after confessing?
In the crosshairs
Then consider the defence arguments throughout this case -- that Basi and Virk were simply political staffers who were told by their superiors to keep OmniTRAX in the B.C. Rail bidding at all costs to make it look competitive, especially after Canadian Pacific dropped out before the decision was announced.
Michael Bolton, Basi's lawyer, and McCullough argued that the RCMP investigation was tailored and targeted at their clients and away from any other political figures.
And they alleged that OmniTRAX was offered a lucrative "consolation prize" worth up to $70 million -- the B.C. Rail Roberts Bank port subdivision spur line that was also up for sale -- if the company stayed in the bidding.
Needless to say, those allegations were never proven in court. The premature end to the trial made sure that any documents, wiretap transcripts or other evidence that might have supported defence contentions will never see the light of day.
And it all happened just before Collins was slated to testify.
The RCMP was at great pains to point out early on after the B.C. legislature raid that no elected officials were under investigation.
It turned out later, however, that Collins had been the subject of an intense video surveillance operation in Dec. 2003, when he met with officials of losing bidder OmniTRAX after CN had been awarded B.C. Rail.
The agreed upon statement of facts signed by both the defence and special prosecutor Bill Berardino is revealing on both counts.
"After the Freight Division bidding process concluded, Basi set up a dinner between Dwight Johnson and Pat Broe of OmniTRAX and minister Collins at the Villa del Lupo. Basi told the OmniTRAX representatives that minister Collins would be discussing with them some form or consolation prize such as another opportunity to do business with the provincial government as a reward for their participation in the bid," the statement reads, referring to owner Broe and top executive Johnson.
"At no time did minister Collins offer a consolation prize to OmniTRAX. Minister Collins' meeting with Mr. Johnson and Mr. Broe occurred after CN had been announced as the successful bidder on the Freight Division," it says.
One can only ask why this level of detail is included in the agreed-upon statement of facts. Was this a key point in the defence-Crown negotiations, to ensure that the term "consolation prize" was accepted as a fact even if it was also accepted that Collins did not offer one?
Mysterious motivations
And what were the enormous benefits that Basi and Virk obtained as bribes for attempting to illegally throw a $1 billion deal to one of the bidders?
A total of $25,695 was paid to Basi. And Basi, Virk and their wives got a trip to see a Denver Broncos football game in the company of an OmniTRAX executive, something worth $3,000.
Who in their right mind would risk losing their well-paid jobs and spending serious time in jail all for less than $30,000 on a $1 billion deal?
Who in their right mind, given all the evidence obtained by police and the pending testimony on behalf of the prosecution by the two lobbyists who provided the bribes, would hold out for six years of court proceedings constantly proclaiming their innocence?
Unless, perhaps, the defence argument actually made sense.
It should be noted that the third accused -- former government communications staffer Aneal Basi, David's cousin -- had his charges of money laundering in connections with those benefits stayed last week as part of the guilty plea bargain deal.
Aneal Basi's charges should have been dropped long ago. Instead he was left on the hook for seven years and had to pay his own legal bills for defence lawyers Joe Doyle and Erin Dance. Ironically the least involved of the three accused is the only one who paid for his own lawyers.
New facts in statement of facts
The statement of facts surprisingly raises new issues not previously disclosed.
It notes previously disclosed information that Bruce Clark -- a long-time executive member of the federal Liberal Party in B.C. and brother of ex-BC Liberal deputy premier Christy Clark -- was in possession of documents "improperly disclosed to Clark" by Basi and Virk regarding the B.C. Rail Roberts Bank subdivision.
But it states -- for the first time to my knowledge -- that Clark was working for the Washington Marine Group, the owner of Vancouver Shipyards, as a consultant and that his employer was interested in acquiring the spur line.
And notwithstanding ex-Pilothouse Public Affairs principal Brian Kieran's recent charm offensive blaming business partner Erik Bornmann for much of his troubles, the statement of fact says Kieran -- not Bornmann -- was given the bid values for CN's, CP's and OmniTRAX's bids by Virk three days before the government's evaluation committee learned them.
The resolution of the charges still leaves many other questions unanswered, making the call for a public inquiry all the more salient.
Gordon Campbell and other officials in his government repeatedly refused any comment on a series of questions about the role Basi played in BC Liberal Party dirty tricks, even though no charges were laid in connection to any of them.
Defence lawyers alleged in court hearings that Basi was involved in stacking paid callers to radio talk shows, including to hosts Jon McComb at CKNW AM 980 and Ben Meisner in Prince George; that Campbell knew of Basi's interventions; that Basi organized counter farmed salmon protests; that he set up a protest outside the B.C. Federation of Labour convention and that his actions were directed or known by staff in the office of the premier.
It was revealed in court hearings that Basi held two $10,000 contracts with the BC Liberal Party for so-called "media monitoring" that appeared to be about media manipulation.
There is no legal reason on earth now for Campbell and others not to answer those questions -- but it may take the compulsion of a public inquiry to get them -- unless the premier's Wednesday night prime time television address is to tell the whole truth about this sordid affair.
What was the Grit connection?
Also unclear is why so many of the key players in this case had strong connections to the federal Liberal Party of Canada during a period in which Paul Martin and his supporters successfully worked to dethrone Prime Minister Jean Chretien.
Former cabinet minister Herb Dhaliwal blamed Basi for organizing the takeover of his then-Vancouver South riding association, where membership jumped from 500 to 4,000, and criticized Campbell's government for not reining in its staff from interfering in federal politics.
Basi was allegedly just part of the Martin-ite takeover led by B.C. lieutenant Mark Marissen that saw federal Liberal members in B.C. jump from about 4,000 in 2001 to more than 37,000 by Jan. 2004, primarily through new memberships sold in the South Asian community. At $10 per adult member, the Liberals raked in over $300,000.
While federal Liberal leadership has since changed from the hapless Martin to the more hapless Stephane Dion to the becalmed Michael Ignatieff, some things haven't changed much. After running the surprisingly successful Dion leadership campaign in 2006, Marissen is currently doing contract pre-election field work for the Liberal Party.
And as recently as Feb. 2009, Bruce Clark was chairing the federal Liberal Party's high-dollar Laurier Club fundraising efforts in B.C. although he no longer holds that position.
Where are they now?
Lastly, it is sadly unavoidable to ask the question why the only players in this vast scandal who have been punished by the courts are two Indo-Canadian men, while Caucasians who were also deeply involved have avoided that fate.
Those who admitted to paying bribes and receiving the bids -- Bornmann and Kieran -- became Crown witnesses and were never charged.
Bruce Clark, according to the statement of facts, was in possession of confidential government information but was never charged.
OmniTRAX and its executives hired the lobbyists who paid the bribes -- something OmniTRAX denies any knowledge of -- but no one faced charges.
Then there are the other players who have all done very well despite this political corruption scandal landing on their doorsteps.
Despite breaking his solemn promise to voters not to sell B.C. Rail, Premier Gordon Campbell survived two elections before the trial began. And he will likely retire soon with a lucrative, publicly financed pension and multiple corporate directorships from a grateful business community.
Ex-finance minister Gary Collins is a well-paid senior vice-president for Belkorp Industries, a prominent B.C. firm.
David McLean remains chair of CN Rail and a wealthy businessman.
OmniTRAX was never charged with anything and issued a statement saying it was not ever under any police investigation
Patrick Kinsella co-chaired two BC Liberal Party election campaigns and was paid $297,000 for B.C. Rail consulting work alone over four years, despite some senior executives not knowing what he did there. Today he is a registered provincial lobbyist.
Brian Kieran has started a political blog and last year said he was opening a new business providing communications and public affairs advice, including "monitoring the provincial legislative agenda."
Erik Bornmann completed law school at the University of B.C. and, astonishingly, may become a lawyer in Ontario if he can pass a "good character" hearing by the Law Society of Upper Canada.
RCMP superintendent Kevin DeBruckyere was promoted during the course of the case.
But after seven years in legal limbo, Basi and Virk are under house arrest for two more. And their future job prospects are dubious at best, given the admission of guilt in a political corruption case.
Fleeting prize
After nearly seven years of covering this case from day one, breaking many stories and having my own office broken into and trashed because of my coverage, I have just one lasting image in my mind.
It's the picture of two young Indo-Canadian political aides and their wives sitting in VIP seats at the Denver Broncos football game in 2002 with then-OmniTRAX chief operating officer Gary Rennick, thinking to themselves: "We've finally made it -- we're part of the elite now! It just gets better and better."
And all the while, neither Basi nor Virk knew that their world would soon collapse and they would likely never again cross the U.S. border due to their criminal records.
Like Rosencrantz and Guildenstern, these two minor players who inconveniently got in the way have been dispatched from the scene forever. ![[Tyee]](http://thetyee.cachefly.net/ui/img/ico_fishie.png){kind=small}
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shepsil
1 year ago
BC Liberals and our Corporate business community make me sick!
Still, I have little empathy for Basi & Virk. Playing with fire can get you burned. The only solution to this type of dishonest BC Liberal behavior is to elect the BCNDP.
Grumpy
1 year ago
BC, thy name is Corruption!
All through the Zalm, Harcourt, Clark era, there was daily news broadcasts on the TV & radio about bingogate, Fantasy Gardens, Hunting knives, sundecks and Fast Ferries. All the above mentioned Premiers left under a cloud, yet none were convicted of a criminal offense.
The media hounded them out of office.
Yet with Gordo, it is much different, the media haven't touched him, yet around him swirls major accusations of corruption on all fronts.
Silence.
Brand-X radio lauds the premier on a daily basis. The mainstream media ignores major unpleasent stories and refuses to do investigative reporting.
One must ask, is the mainstream media complicit with the evil that now has engulfed Victoria?
marlonbrando
1 year ago
2 words
Fast Ferries.
DJT
1 year ago
Fast ferries?
Fast ferries? This has nothing to do with "fast ferries" and all of this makes the "fast ferries" issue look like child's play.
Barryeng
1 year ago
What BC needs right now, is
What BC needs right now, is our own version of Wikileaks. There are too many people out there with at least some information that should be made public. Surely someone who knows something the is not being disclosed has at least a small bit of conscience, and would be willing to"let slip" that information if guaranteed anonyminity.
I know that morals are in short supply regarding this issue, but surely there is some way this information can get out.
Gary
1 year ago
What I would like to hear
...is Cristy Clark do a full program on what her brother and husband were involved in. You know, the type of show where she beats a subject to death to make her point.
But I suppose that will never happen given that she only pumps things that make her lok good to the Campbell minions.
BC Mary
1 year ago
To Bill Tieleman, Special
To Bill Tieleman, Special thanks
for your years of attending BC Supreme Court and reporting faithfully to the former owners of BC Rail.
And a special Tip o'the Tuque for this column today which is, without a doubt, your very best.
Freedom of speech (i.e., no more Publication Bans) is a wonderful thing, isn't it?
Also: Citizen Journalism is a new and promising tool for an enlightened society.
I bet you'd agree that Citizens have work to do yet, to discover what really happened to our railway.
It was Peter Ewart who recently dared to say it right out loud ... that someday the people of BC will once again own this vital railway ...
well, I dare say it, too ... that an illegally-drawn agreement such as the BCR-CN agreement (still partially secret) is an illegal agreement ...
dave henderson
1 year ago
Fast Ferries
We could have built a couple with the cost overruns on the convention centre. That point is long dead only the willfully blind still bring it up
Fiat lux
1 year ago
Basi and Virk will be looked
Basi and Virk will be looked after very well for their guilty plea.
They know very well what went on behind the scenes, who was giving the orders, but kept nice and quiet to protect the guilty.
This is a textbook case, either of total ideological brainwash, or self interest on the long run.
Ed Deak.
RickW
1 year ago
I agree with Ed
They weren't "unwitting".
seth
1 year ago
Lucrative consulting contracts?
The nudge nudge wink wink fart of the deal.
Stewart MacKenzie
1 year ago
You have to ask?
"One must ask, is the mainstream media complicit with the evil that now has engulfed Victoria?"
KWD
1 year ago
why the voter complacency??
Tieleman is correct; if this “was merely a “’grubby little episode’” where the guilty confessed to being “’small time shakedown artists’”, it would have ended years ago. But it didn’t.
If there is an inquiry into this case, it should focus on why the public is being so indifferent to the fact that our political leaders are able to continue lying about their intentions and why the MS media is helping accomplish their goals.
ifsandsnbutts
1 year ago
BC Mary said...
..."Citizen Journalism is a new and promising tool for an enlightened society."
True! Thank you for this opinion piece Bill...there are some things in it that I question, but for the most part, you're absolutely correct.
There is another story written by one of the best investigative bloggers out there, Laila Yuile...it deserves to go viral. I wonder if the folks in Dawson Creek, Cranbrook, Kamloops and all other cities/towns in BC are happy to be paying the tolls for those traveling to Whistler? They don't know they are...yet. They were never supposed to know...but the invasion of privacy issue attending this story should make everyone's hair stand on end.
Find it here:
http://lailayuile.wordpress.com/2010/10/25/breaking-news-bc-liberals-inked-hidden-toll-into-sea-to-sky-highway-deal-and-we-all-pay-for-the-next-25-years/
Now let's see how long it takes for the PAB types to try and bury this one.
BobZirunkel
1 year ago
The rest of the story
Reasonable attempt to paint these guys as patsies.
But there's a glaring omission here re the police raid on the Leg:
http://www.canada.com/story_print.html?id=82eeca7a-4f77-49f4-ad9b-949c6e66795c&sponsor=
h/t BC Mary:
http://bctrialofbasi-virk.blogspot.com
BC Blue
1 year ago
Great run-down...
...on the players that received a bare mention in the MSM but Tieleman's portrayal of Basri and Virk as victims is a little much to take.
They knew darn well what they were doing and got off with the sweetest deal possible to buy their silence. No sympathy from me...
Bobb999
1 year ago
Hung out to Dry?
"Hung out to dry",eh? With multi-million dollar "gifts" from the gov't paying for all their legal fees, plus they get to avoid jail time to enjoy a quiet "vacation" in comfie homes?
The white hats/black hats caricatures Bill paints are hard to view as accurate portrayals. If there was a larger conspiracy, as Bill proposes, B & V appear to have been willing participants, not victims, making their hats look rather murky-grey at best, not virginal white!Does Tieleman really think B & V are as upstanding & innocent as he claims, or is it merely convenient for him to paint them that way?
freebear
1 year ago
Only victims are citizens of BC and taxpayers!
The rest are Charlatans; out for themselves and the Bilderberg crew!
Why agree to a non-disclosure clause too?; could have been a sweet book deal for poor Basi and Virk!
AHHA
1 year ago
Evil grows in the dark
I think the article was a bit generous to Basi and Virk however the point of the article was not lost on me as it seems to have been with other commenter’s here. That is that they were low level middlemen. If I reflect on that as opposed to the deal that they got that makes us all upset, then it follows that the next phase is to see who were the people on the other ends of the middlemen and whether or not there needs to be an accounting such as originally envisioned by staff sergeant John Ward who has subsequently been discredited. Don’t miss the plot folks it is as clear as the deliberate misinformation we are being fed by the MSM.
btw, freebear the book deal would be illegal.
G West
1 year ago
Book deal would be illegal?
How so?
AHHA
1 year ago
Not so
Seems my assertion is a bit outdated G West thanks for the heads up.
“So-called "Son of Sam" legislation was quashed by the Canadian Senate in June of 1998. Bill C-220 would have prohibited convicted criminals from profiting from writing about their crimes by confiscating the copyright flowing from books or movies. It had earlier passed in the House of Commons quietly with nary a protest. The Writers' Union of Canada and PEN Canada had argued before the Senate committee considering the Bill that it would violate freedom of expression and was in effect a permanent gag on anyone convicted of a crime”.
Source: http://archive.ifla.org/faife/report/canada.htm
cboo44
1 year ago
Hung Out To Dry??
"Former BC Liberal ministerial aides Basi and Virk do not deserve to spend a single day under house arrest, let alone the two years less a day they were sentenced to last week ....."
[edited. -moderator.] KNOWINGLY involved themselves in corruption, NOT just with the BC Rail scam, but ALR payoffs, and God only knows what else. "2 years house arrest" ???
Excuse me? You mean sleeping in their own beds for 8 hours a day? DAMN! THAT MUST BE PURE HELL !
"RCMP superintendent Kevin DeBruckyere was promoted during the course of the case."
SO WHAT? Did you know that DeBruckyere is one of the members of the one graduation class at the RCMP Academy known as "Blue Troop" ? Called that because EVERY one of those rookie graduates is now wearing a blue officer's uniform.
You have very carefully placed Kevin DeBruckyere's name into question. That is absurd. DESPITE what his brother-in-law has become LOOOOONG after Kevin was married.
Skywalker
1 year ago
Right on Bill
Now what I want to hear in this sordid BC Liberal scandal is Carole James say,"There will be a public inquiry" not just that there should be one. These crooks in the liberal caucus and their leader need to be held to account.
blackie
1 year ago
missing in action
There are two issues that trouble me on this.
One is the obvious corruption stuff that you guys are hyperventilating over (legitimately, I'll concede). I too have a hard time believing these guys weren't following orders.
But the sudden resurrection of BC Rail as a profitable operation doesn't wash. It had oodles of debt forgiven several times over its existence, and showed what you're calling an "operating" profit for that reason only.
Had CN NOT been the successful bidder, there would be no container port at Prince Rupert nor would there be any of the additional tranfers/reload facilities in Prince George. CN made it clear (and you can find references to it in that hated MSM over the years) that without the BC Rail assets and the ability to smoothly move cargo among the various players in Prince George, they would not have made those investments in the line to Prince Rupert. BC Rail would still be a money-losing regional railroad going nowhere and the northwest would still be looking for something -- anything -- to get it out of the economic doldrums.
I guess you can call that economic blackmail if you like, but the provincial economy would not be better today -- especially in the northwest -- if that deal hadn't gone through. The container port had the bad luck to start operations at the beginning of the global meltdown, but over the next decade or more it's going to be the economic anchor up there. What you guys don't realize is that without the container operations, the Port of Prince Rupert would have been shut down by now.
Rail against the corruption (pun intended) all you want, but spare me the crocodile tears over this "lost" provincial asset. It would still be costing us billions if CN hadn't taken it over.
Skywalker
1 year ago
Blackie
That is why we need a public Inquiry.
Frank
1 year ago
blackie
Who's your source for BC Rail being a huge money-loser?
Fiat lux
1 year ago
I wonder how much the long
I wonder how much the long row of Diesel trucks cost on Hwy 97, in ecological and monetary damage, because there are no rail cars available from our "wealth creating foreign investors?, who bring nothing but imaginary, worthless US Dollars from a bankrupt economy ?
Ed Deak,
RockyRacoon
1 year ago
An excellent piece it reminds me of something I once heard about
wealth, " 'Balzac said that behind every family fortune is a great theft'
and I would add that behind every great fortune is a public-sector giveaway"
I can't credit the author of the latter quote, I have a photographic memory but am currently out of film, many thanks to whomever.
RR
Fiat lux
1 year ago
Wealth can not be created,
Wealth can not be created, only taken from others, the environment, or future generations
Ed Deak.
blackie
1 year ago
Frank
"Who's your source for BC Rail being a huge money-loser?"
There are lots of official places to find it -- but why not just use Will McMartin's piece in the Tyee. He documents all the write downs (doesn't say much about the lingering debt in spite of all that); discusses all the closed operations and the loss of revenue (without explaining that the revenues were well below the corresponding operating costs) and then, having conveniently dismissed the notion of debt servicing, declares an operating profit! Wow! Didn't anyone read that royal commission report done the first time this albatross got in trouble?
BC Rail's last three-year service plan for 2003-05 outlined it nicely:
"A large proportion of BCRC's debt was incurred in 1983 through BC Rail's involvement in northeast coal developments. Unfortunately, the anticipated returns did not materialize ... By the spring of 2003 all coal traffic will cease. As a result, the value of all coal-related assets was written down by some $600 million in 1999, but the lingering debt attributed to northeast coal development has not yet been addressed. In addition, throughout most of the 1990s, BCRC's capital demands outstripped earnings, requiring most of the capital to be financed with debt ..."
I could go on, but you get the picture. Had BC Rail not been sold it would have most likely been shut down entirely because of public outrage at the hundreds of millions of our dollars it needed to keep its rolling stock and rails in reasonable shape 0-- with nothing but declining revenues to show for it.
editingfool
1 year ago
tireless tieleman
my only hope is that everyone reads tieleman today.
it seems he alone is determined to lance this boil. stand back.
thanks for not giving up on it bill.
and even though virk and basi may be 'less,' guilty, they still laid down with a bunch of flea-ridden dogs.
lets hope the voting public's memory lasts till the next election.
Former British ...
1 year ago
"....unwitting pawns in a
"....unwitting pawns in a much bigger chess game where all the other players came out winners.".....tell that to those who were shut out of a legitimate bidding process - i.e. Canadian Pacific Railways, et al
RickW
1 year ago
blackie
Why? The public isn't outraged at other white elephants costing "hundreds of millions of our dollars".
G West
1 year ago
Blackie
You need to read that article of Will's again - carefully.
Furthermore, if you'd been paying attention to what Brian Kenning said on the stand (he was the second and last crown witness) you'd have been aware what the BC Rail board was actually up to during the time between Campbell's election in 2001 and the final 'disposition' of the railway.
The debt (which goes back decades) was written off - you need to learn exactly what that means...in fact, it's exactly the same thing that Campbell has done to Basi and Virk's legal bills.
Please, read Will McMartin's piece again, carefully and, if you have questions, consult an intermediate accounting text..you really DO have a lot to learn.
jimmy_laroux
1 year ago
@ blackie
You're not concerned about the lying and corruption that's permeated the BC Rail sale? I'll keep that in mind.
According to McMartin, it had "...had a net profit -- or, net income -- in 18 of the 21 years between 1980 and 2000." Also, when was it's debt ever "forgiven"?
How's that?
Again, it was profitable most of the last twenty years of its operation, according to McMartin, so this scenario you mention is rather unlikely.
McMartin gives (according to him) net profit, which accounts for interest payments (shown at the bottom of that article).
Really? This sounds like a load of horsesh*t. Do you have a source?
Yeah, selling BC Rail sure fixed that.
Frank
1 year ago
blackie
jimmy_laroux beat me to it.
If that article is your source then you either read it very selectively or you already had your mind made up beforehand.
Frank
1 year ago
1983
And by the way, 1983 was a political decision. Made by another right-wing government.
seth
1 year ago
More gordonomics
The railway was given away at the start of the biggest resource boom in BC history. Everything that taxpayers had invested in the railway was geared towards the dream of such a boom. Profits would have been immense.
crankypants
1 year ago
As much
As much as I would like all the details on the sale of BC Rail exposed, I doubt that will ever occur.
If we actually had a legitimate legal system, Basi and Virk could have spilled their guts, whistleblower style, and implicated the hawks involved. Unfortunately, the hawks are on the untouchable list, which meant even Perry Mason couldn't save their sorry butts from forever being saddled with a criminal record.
The biggest problem, as I see it, is that the police can collect all the incriminating evidence they could ever need to convict an elected official of a crime, but if the Special Prosecutor chooses to ignore said evidence, nothing will ever come of it. I've heard and read many reporters state that there was no factual evidence of impropriety in the sale of BC Rail brought forward. But if said evidence is shielded from the public, how can they be so sure?
Barryeng
1 year ago
" By the spring of 2003 all
" By the spring of 2003 all coal traffic will cease"
If that was the case, then why did I get stuck behind a level crossing bar recently, watching a long train of cars, loaded with coal, heading for the coal port in Prince Rupert. . . a CN train.
Incidentally, The portion of the port in Prince Rupert that accepts coal shipments, is seperate from, and not connected in any way to the container facilities. In fact, the two seperate entities were built about 15 years, and about 8 to 10 kilometers apart. apart
mcgregory
1 year ago
Once again
Sounds like the RCMP blew it again. It certainly sounds like they didn't have much of a case going on here.
I think they totally overreacted to a minor situation that should have been handled internally.
Wasn't this at the same time Picton was murdering women. I guess the priority was for making sure business was being taken care of, but let the DOE residents fare for themselves.
What a sad waste of time and resources.
Jeffrey J.
1 year ago
Kudos to Bill Tieleman
Kudos again to Bill Tieleman!
He is one of BC's best independent journalist, courageous and tireless. And there are others. All of these journalists and media sites (like the Tyee, Rabble.ca, Public Eye and Rafe On Line), are one of the last lines of defence to our democracy.
Great, great coverage that cannot be emphasized enough.
Will this be enough to keep freedom of speech alive in BC? Only time will tell.
Skywalker
1 year ago
Not so mcgregory...
...it sounds more like the RCMP is just friendly to the liberals. If they had wanted to the would have investigated more and relied less on the defense lawyers to ferret out the connection between Basi, Virk and the kingpins who made the decisions. Now had the government been NDP, the RCMP would have been on this like fleas on a hound.
Driftwood
1 year ago
Really Bad Idea Bill Tieleman
You want this same government which has perverted the course of justice for the last 6 years in order to win two elections (who would have voted for them had Basi/Virk pleaded guilty? look at the anger.) to appoint an independent inquiry? With somebody like Berardino in charge perhaps?
No. This government should be RECALLED.
North of Hope
1 year ago
@ Barryeng
CN had a rail line all the way from the Atlantic to the Pacific before they bought BC Rail. Their line went from the prairies to Prince Rupert and they were shipping coal from Northeast BC to Asia. The BC Rail sale had nothing to do with those shipments.
rcranium
1 year ago
liebral truth and justice = rotting compost pile
The back room manipulations of the Liebral trash handlers orchestrating the disemination of the their political compost pile would make a Maggot gag...........
We need a man like Mao to clean up the flies and lies.......
blackie
1 year ago
jimie_laroux
"You're not concerned about the lying and corruption that's permeated the BC Rail sale? I'll keep that in mind."
Yes, I am. And I said so.
According to McMartin, it had "...had a net profit -- or, net income -- in 18 of the 21 years between 1980 and 2000." Also, when was it's debt ever "forgiven"?
You guys are treating the McMartin piece as gospel. He completely dismisses all the public money spent to build BC rail by glibly suggesting that a "writeoff" doesn't mean any money is spent. The money -- taxpayers money -- was already spent. A writeoff happens when a company (or in this case crown corporation) decides that an asset is non-performing -- it won't ever pay for itself. For BC Rail is was nearly $900 million. It's a book keeping entry used most effectively by a private company for tax purposes. But it doesn't magically negate the fact that the money was spent in the first place to build that non-performing asset. You guys must think it came from the tooth fairy.
"How's that?"
If BC Rail were still a public railroad, and hadn't been shut down, the public would be paying for all the maintenance and equipment needs with no revenue growth to show for it. It's called throwing good money after bad. BCRail's last service plan (or, attempt to stay alive) called for a drastically reduced annual capital budget of $50 million -- and that was just to keep things from falling apart.
"Really? This sounds like a load of horsesh*t. Do you have a source?"
Yes, I do. You think it's horseh*t because it doesn't fit your somewhat narrow view of the world. CN would not have followed through on the container development without an end to the Prince George bottlenecks created by having BC Rail control the transfers.
Yeah, selling BC Rail sure fixed that.
Why don't you phone the Prince Rupert Mayor (Prince George too) and ask them if they'd like to "disappear" those container facilities. Ask if they've got anything else up their sleeves.
Frank
1 year ago
blackie
"You guys are treating the McMartin piece as gospel."
And you sure seem shy about posting the source you consider to be gospel.
BC Rail's sudden problems were caused by Liberal management.
Tieleman
1 year ago
Bill Tieleman with thanks - and clarification
Thanks to the many posters here for the kind comments about my coverage of Basi-Virk over the past nearly 7 years. And thanks to David Beers and The Tyee and 24 hours and my former editor Dean Broughton for supporting that work.
I do want to clarify for readers that I do not argue here or believe that Basi and Virk were "innocent". They admit to accepting illegal payments and have never denied it.
samuidave (not verified)
1 year ago
here's what you get...
when the credulous BC citizenry accept the state propaganda that 'you should not waste your vote on anything but a potentially winning party' candidate.
100+ years of ever escalating corporate-government corruption. The reality of our ignorance to think for ourselves is stunning.
Vote only independent, or accept your vote as supporting corporatism.
jimmy_laroux
1 year ago
@ blackie
You stated that those who were concerned were "hyperventilating", implying that they were overreacting. Have you changed your mind?
McMartin quotes "net income" in that paragraph, not "operating income" or anything else. I do not have the BC Rail figures at hand, so I can't verify his numbers. Are you saying his numbers are wrong, or that this is not net income?
If BC Rail spent this money then it must be reflected in BC Rail's debt. So where's the problem?
No, BC Rail would be paying all the maintenance and equipment needs. BC Rail was profitable in its last year of operation and forecasting profits in the years ahead. It's also useful to bear in mind that (BC Rail) revenue growth was never the purpose of BC Rail.
If you've got a source, provide it. Or should I just take your word for it?
Selling the entire railway sounds like a dramatic solution to this relatively minor problem. I hope you see why it sounds like horsesh*t.
You're assuming that the container port would not have been built without selling BC Rail (as if CN would have refused to use the conainer port if built), which, as I state above, is completely ridiculous (i.e. horsesh*t).
You haven't answered my qustion about BC Rail's debt being forgiven. You stated that it was. When did this occur? And who were the creditors who so generously decided to forgive it?
lynn
1 year ago
Swimming with Sharks
Thanks for all your hard work and years of perseverance in reporting on this story, Bill.
While I don't think Basi and Virk are guilt-free, I do agree that they are small fish in a shark pool of ever-circling Big Whites.
One could easily surmise that, perhaps, this scenario may have been 'presented' to BVB:
The 'suggestion' that if a guilty plea was not forthcoming soon, that this trial could and would be extended for years to come - with more of the convenient stops and starts that have been the fingerprint of this case from day one.( After all, the delays in this trial have not come from the defence, but were caused largely from the government's unwillingness to disclose documentation (expressed ever-so-specially through the SP) and the resulting time-consuming legal wrangling that thus ensued. The judge even stated fairly recently that the trial would end in Spring of 2011. And the Special Prosecutor recently offered up that he was going to cut the witness list in order to shorten the trial.)
So why was the idea of a long trial suddenly becoming an issue when everything was in fact, pointing to an effort to shorten the length of the trial from the original calculated time frame?
So yes, it took far too many years for this case to get to trial, and yes, the pre-trial seemed endless, but when the trial began, it zipped along. Brown and Kenning hardly remembered a thing, so there was certainly no long drawn out detailed testimonies to endure, just a series of abrupt often indignant replies by the major witnesses who mostly stated they couldn't recall a thing about anything that happened under their watch.
I mean, at this rate, with no one able to remember much of anything, this trial could have been over by Christmas.
But then all the upcoming witnesses would have looked not only foolish and incompetent, but seemingly suffering from some strange memory loss virus that was making them all sound conspicuously alike in their preferred state of amnesia.... giving a stench to the proceedings that made any careful observer realize something was deeply and darkly amiss.
And so this finally must have occurred to Someone......
That, perhaps, all was not going to plan and that the public ( excluding the tamed MSM ) was not being fooled by this carefully crafted piece of theater - a play short on both details and dialogue that was quickly unraveling and looking more and more suspect with every witness called.
And what, too, if one of those witnesses, actually decided to recall something?
So it is easy to see how Basi and Virk may have had a forced epiphany revealed to them that even more years of their life would be put in limbo, if they did not change their plea to guilty - that guilty plea being the one thing that could bring this trial to a convenient and quick end...and bring the curtain down before the strange behavior of all those involved gave the plot away.
Driftwood
1 year ago
Excuse me, that's OUR railroad!
First, playing the race card was really low, Bill. They weren't convicted of being Indo-Canadians, they were convicted of taking bribes in a deal which was directly related to the give away of a profitable public asset.
Second, what Blackie is on about is how much he doesn't want the railroad returned to its rightful owners. That's why he would have us believe that it is losing money. It isn't, those coal trains have been running steadily since 2004 - two coal mines going flat out. One expanding, another being built, another underground being seriously considered. Cants (square cut raw logs) being shipped by rail to PR, huge mines opening - more planned. What a great time to own a railroad in BC!
I was reading an article in the Globe and Mail (because it has had by far the best coverage of the corruption in BC) and saw the following comment:
"I don't understand how these guys took the millions knowing the whole time they were guilty as sin."
Interesting. Any ordinary person would be looking at precedent and worrying about how they were going to come up with the money for those high-priced lawyers? What did they know that made them willing to take that chance? or did they know that they weren't taking a chance at all? Something smells funny there.
Put it another way, what sane persons are going to hire lawyers to the tune of 6 million dollars for something which is going to get them at most about 18 months in jail of actual time served? Something very fishy there.
CN gave 300,000 to the Liberal Party over the last 15 years. How much would they have given if they hadn't wished to buy BC Rail? We can safely say that they made those contributions to secure that railroad. We know that the head of CN was a personal friend of Premier Campbell. That looks like a bribe any way you look at it. And if Mr. Campbell agreed to sell the railroad in return for those contributions that is called influence peddling and is no different from the crimes for which Basi/Virk were convicted.
Let's suppose that was the case. Mr. Campbell's party accepted large campaign contributions in exchange for a promise to sell BC Rail. BC Rail's reputation was 'fixed' to lower the value of the railroad prior to the sale. Four parties were interested in the railroad, but two dropped by the wayside complaining that the fix was in - that CN was already chosen. The other railroad, Omnitrax, is offered a special deal; a gift you might say of a small but valuable line on the lower mainland. In return, they have to stay in the bidding to make the BC Rail(gate) sale look like a legitimate deal. That's how it was planned to go down, and in my eyes that makes the whole deal so tainted that we should bloody well get our railroad back.
blackie
1 year ago
Do some reading
"You haven't answered my qustion about BC Rail's debt being forgiven. You stated that it was. When did this occur? And who were the creditors who so generously decided to forgive it?"
For 12 years -- 1981 to 1993 -- taxpayers funneled $410 million in operating grants to compensate for uneconomic operations. This after taxpayers provided ALL the money to build the damn thing.
Then they turned it into a crown corporation to get the still-accumulating debt (despite regular infusions of public money) off the province's books and they cut the railroad off from any more grants because, well, it was getting embarrassing.
Four times after that, BC Rail had to write-off assets totalling $857 million. It was still running up debt because at the time of the CN purchase there was still about $250 million in debt on the books -- and insufficient revenue o pay it down.
"You're assuming that the container port would not have been built without selling BC Rail."
That's right, I am.
"Are you saying his numbers are wrong, or that this is not net income?"
No --- he got the numbers right. But both profit and net income look a little hollow when you consider all the public money injected and the massive write-offs on non-performing assets -- and they weren't paying off any debt. In fact, the debt was going up. It's smoke and mirrors.
Go back and read the 1977 royal commission report which also recommended unloading the albatross. If they followed that advice at the time, it would have saved a lot of angst and a lot of money.
For a better world
1 year ago
BC Rail Write-offs?
Weren't the debt write-offs related to the Tumbler Ridge extension, and wasn't BC Rail forced to undertake this major project by the Bill Bennett regime?
Wasn't the extension supposed to be paid for by the Japanese funding at a certain rate per ton? As soon as the line was completed, world prices dropped. Although the contract with the Japanese was at a fixed contract price, they were allowed to re-negotiate twice. The new rates couldn't fund the expanded operation, never mind the debt. Tumbler Ridge virtually collapsed, but began to revive in the late 1990's.
Another debt BC Rail carried was the Dease Lake expansion. This was another politically driven project, but after Bill Bennett was elected he cancelled the project even though the rail bed was basically completed.
Although the contract for this rail line extension was cancelled, the contractor successfully sued the Province and BC Rail for the entire cost of the project. My recollection is BC Rail carried these debts for a long time before they were forgiven.
zalm
1 year ago
Thanks, forabetterworld
I was just getting out my copy of Marjorie Nichols' Mark My Word to review how the Bennett government insisted that Teck take the profit from more than $1.6 billion in taxpayer subsidies to open that massive coal mine, along with $600 million to build the spur line to connect with CN's mainline to Rupert. All this so that BC could claim it was "open for business", never mind how much it cost the taxpayer.
BC Rail's lines always had politics mixed up in them - where new lumber or pulp mills could not afford to lobby CN or CP to open new spurs to their plants, a judicious word and campaign contribution to the Socreds could always guarantee that BC Rail would open up a line at public expense, and the heretofore uneconomic mill would suddenly be worth a billion.
Shady? Perhaps. Yet, government is in the business of opening up opportunities for people to earn a living, get an education, raise their kids and live their lives.
For the same government (and the same government it is too, of white-belted used-car dealers such as Jack Weisgerber, who supported both) to now say that BC Rail's expenditures were a mistake and a drain on the public treasury is mendacioius and misleading in the extreme.
Or right about what I've come to expect from the BC Fiberals.
I'm surprised at you, Blackie - usually you come up with much better than this.
zalm
1 year ago
Barryeng
Western Coal Corp ships metallurgical coal to Asia. Probably others do too.
jimmy_laroux
1 year ago
@ blackie
So I guess can assume from your lack of an answer that the debt wasn't forgiven and that you were lying. I thought so.
Good.
It's really very simple. If they have positive net income, then they are able to service their debt. I don't think it can be put any more simply.
As for the write-offs, they are in no way a reason to sell BC Rail.
Of course taxpayers provided the money. It was a crown corporation.
I think it had been a crown corporation for some time before that, no?
That assumption you make is so stupid it's laughable. And still no source to back it up? So I'll assume that you were lying (again).
I don't think you understand the purpose of BC Rail.
jimmy_laroux
1 year ago
@ For a better world
Exactly!
jimmy_laroux
1 year ago
@ blackie
BC Rail served mainly as a tool to facilitate resource extraction, and was forced on occasion to take on large projects which didn't pan out e.g. Tumbler Ridge and Dease Lake extensions. The Ministry of Transportation is unprofitable. Should we scrap it?
lynn
1 year ago
Follow the money and the documents
The BC Rail Corruption Scandal - distraction and evasion from beginning to end.
Keep the focus on a couple of Ministerial Aides while those who offered the bribes are given a free pass - And those who facilitated bribery as policy were never questioned.
In fact, what clever psychology employed in a plea bargain - directing public anger at defence fees instead of at the BC Rail 'steal of a deal' - that included an indemnity clause that could leave the people of BC on the hook to pay hundreds of millions of dollars to CN, 'the buyer' of the railway. Add in the loss of all those profits to the people of BC, the loss of jobs, the loss of passenger service and the cumulative effect of all these things to BC communities and to the people who live there.
The delays by government, their refusal to disclose evidence, dragged this trial out for years with no regard for the public who would foot the expensive legal bill.
As the trial starts, and all the expense seems finally worth it, the case is stopped in its tracks.
Recall the serendipitous timing of the arrival of camera crews at Premier Glen Clark's home just as the RCMP were about to execute a search warrant -
"Never before had police executed a search warrant on the home of a sitting premier. We were witnessing history."
Almost those same words were used about the raid on the BC legislature: "Never before had there been a police raid on a provincial legislature, we were witnessing history."
Those who have followed these two cases cannot help but note that the both of these historical events contain many of the same key players.
So here's my conspiracy theory: Both of these events have a certain orchestrated 'show appeal' to them. An attempt to create a picture in the mind of the public - each for their own reason. I'll just focus for now on my theory on the legislature raids - that the picture being created of endless boxes of government documents being removed from the provincial legislature 'looked like' we were seeing a search to aid an investigation. An investigation that stated even before those documents were even looked at that "no government officials were involved". How strangely psychic and illogical of them. How convenient.
But what if those endless boxes of documents being removed in full daylight for all to see were not being carried away to investigate those documents but were,instead, being removed to protect and control certain information in those documents from the from the scrutiny of the public? From the chance of information being leaked to the public ?
When you follow the course of these documents, how, where and who vetted them, where some missing computers landed, and how information became redacted, deleted or lost, a far different story is being told, more weighty and much darker than the present lightweight distraction.
janetvickers
1 year ago
Come election
It would be more than nice, if the public remembered this, along with everything else that has been 'achieved' for the people of BC since Liberals came into power, when election comes around.
It would be nice also if the public could compare this with the images and allusions trotted out by the mainstream media.
It would also be good for our grand-children if people stopped thinking that social justice equals Stalin, and that social responsibility means letting the destitute pull up their own bootstraps.
But come election time people will forget all this and fall back on the narratives that make them feel most superior.
RogerM
1 year ago
Hung Out to Dry
Premier Campbell - "Just say it isn't so!"