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Will BC Rail Bomb Explode?

Basi-Virk lawyers allege deal was rigged by BC Libs.

Bill Tieleman 6 Mar 2007TheTyee.ca

Bill Tieleman is a regular Tyee contributor who writes a column on B.C. politics every Tuesday in 24 hours, the free weekday newspaper, also online at http://vancouver.24hrs.ca. Tieleman can be heard every Monday at 10 a.m. on the Bill Good Show on CKNW AM 980 or at www.cknw.com. E-mail him at [email protected] or visit his blog at: http://billtieleman.blogspot.com.

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"They've been calling for this deal to be cancelled since before it started, so it doesn't surprise me much. [But] there has been nothing that's come to our attention or to the attention of investigators that would lead anybody to believe that there was any concern about the CN transaction at all."

-- B.C. Finance Minister Gary Collins, March 13, 2004

The $1 billion privatization of B.C. Rail will be the explosive core of the upcoming April 2 trial of former provincial B.C. Liberal ministerial aides David Basi and Bob Virk on fraud and breach of trust charges.

That's what lawyers for the defence are alleging in a lengthy application for disclosure filed Feb. 27 in B.C. Supreme Court, saying the B.C. Rail deal is the key to the entire case -- and to their exoneration.

The defence dropped bombshell allegations that Premier Gordon Campbell's B.C. Liberal government had already delivered the deal to CN Rail before final bids were even considered and that Basi and Virk were only following Collins's orders to deliver a $70 to $100 million "consolation prize" to losing bidder OmniTRAX -- the B.C. Rail-owned Roberts Bank spur line.

But those are far from the only shocking allegations in the defence document.

And given that the defence has served notice it seeks a stay of proceedings against Basi, Virk and Basi "on the basis of an undermining of the accused's right to a fair trial," it may turn out that the claims made are never introduced as evidence because the trial never happens.

Alternatively, presiding Justice Elizabeth Bennett may grant some or all of the defence's long list of requests for disclosure of evidence against their clients, evidence that could prove very damaging to the provincial government and the federal and provincial Liberal parties.

Fair trial jeopardized?

The allegations in the 32-page application filed by the defence prior to the trial -- to which the Crown will file a reply on March 14 -- come more than three years after the Dec. 28, 2003 police raid on the B.C. legislature. The allegations, it should be reminded, have not been proven in court.

At the heart of the defence case is a serious contention -- that the police and Crown have so screwed up their prosecution of the accused that a fair trial is impossible.

The defence will file a Charter of Rights challenge to the case on March 21 and that application, plus other defence requests, could well have the effect of delaying the April 2 trial start date -- if they don't result in the complete cancellation of the trial itself.

If the trial goes forward, expect the $1 billion B.C. Rail privatization to be placed under more scrutiny than ever before, because it is central to everything about this case.

And notwithstanding former B.C. Liberal finance minister Gary Collins's claim in March 2004 that the there was no concern by investigators about the B.C. Rail sale to CN Rail, in fact the police were literally all over it.

Just how much concern there was can be seen in the defence application, which details a major police surveillance operation focused on Collins himself when he dined with senior executives of OmniTRAX at Vancouver's posh Villa del Lupo restaurant on Dec. 12, 2003.

CN Rail had just been announced as the successful bidder for B.C. Rail on Nov. 25, and according to the defence document, the RCMP learned through intercepted communications that Collins was meeting with OmniTRAX executives Pat Broe and Dwight Johnson.

'Extensive video surveillance'

"The surveillance included undercover operatives both inside and outside the restaurant, and extensive video surveillance and tracking of the parties," the defence states.

It claims that on Nov. 17, 2003, the RCMP had "learned through a series of intercepted communications that Mr. Basi advised OmniTRAX that Minister Collins had authorized a consolation prize for OmniTRAX in exchange for them staying in the bidding process."

The defence will argue that Basi and Virk were merely following ministerial orders from Collins, not acting in their own benefit by leaking confidential government information to a lobby firm representing OmniTRAX.

The defence applications spells this out clearly: "The defence takes the position that at no time did Mr. Basi or Mr. Virk act in a fraudulent, deceitful or criminal manner, but rather acted at all times under the direction of their superiors in the highly political circumstances of their offices."

'Fraught with political controversy'

The defence also spells out just what kind of importance the B.C. Rail privatization had to the B.C. Liberal government.

CP Rail had already dropped out of the bidding, saying privately to government that it believed CN Rail was the predetermined winner of the bidding. A letter to that effect stated that a "clear breach" of fairness had occurred when other bidders obtained confidential government information about B.C. Rail.

"It was clearly in the provincial government's political interest to have an auction with more than one bidder," the defence application states. It later continues that:

"The decision by the Liberal government to sell B.C. Rail was fraught with political controversy, largely because it was in direct contravention of a previous election promise not to sell B.C. Rail. The Liberal government had recently suffered serious losses of political capital due to their decisions surrounding other major projects, including the Coquihalla Highway project."

"The B.C. Rail bidding process therefore had to be handled with the utmost political care, given this sensitive political climate," it concludes.

Who will testify?

"Sensitive" is a good word to describe much of the evidence slated to be heard in this trial.

For example, will former finance minister Gary Collins be called to testify against his own former ministerial assistant David Basi?

Entirely possible and totally impossible for the defence to actually know, because they also allege that: "From the outset of this case, defence counsel has repeatedly sought a list of witness the Crown intends to call at the trial of this matter." That list is among the requests the defence is asking Justice Bennett to order the Crown to provide.

The defence is also frustrated that it has limited information about "an interview with a member of the public who provided the RCMP with his opinion of two witnesses on the condition of anonymity."

"The special prosecutor and RCMP have refused to provide this statement, advising that its disclosure would breach the third party rights of this individual and the two witnesses," the defence states.

What is alleged

Again, a reminder is in order that these are only allegations not proven in court. Among the more stunning allegations made by the defence are these:

In a nutshell, a bombshell

In a nutshell, the defence has alleged that there was an internal political decision by the B.C. Liberal government to "fix" a $1 billion dollar deal and pay off the losing firm with another deal worth up to $100 million. And it seeks internal RCMP and government information on whether the B.C. Rail deal should have been rescinded.

It also alleges that a key RCMP investigator was related by marriage to the top staff person of the B.C. Liberal Party and that confidential information about the immunity granted to the Crown's key witness was leaked to that staff person.

The defence also alleges the special prosecutor gave beneficial treatment to two provincial lobbyists who are to be Crown witnesses, so they could continue their lucrative business. And that one of those witnesses still faces potential criminal charges.

More shockers?

Believe it or not, this lengthy compendium does not even cover all of the allegations made in the defence disclosure application -- not even close. I have deliberately left out many of the allegations that have been previously reported in The Tyee and other media outlets for reason of space and complexity.

Suffice it to say that if the Basi, Virk, Basi trial does go ahead as planned, there will be more bombshells than on a bad day in Iraq.

And if the case is somehow derailed by defence motions, well, British Columbia will have been deprived of the most fascinating trial in decades, a trial that could well alter the course of provincial political history.

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