Business
Quebec firm to pay $10M to avoid charges over bribes promised to Philippine officials
Philippine Interior Secretary Ronaldo Puno attends a news conference Thursday, Nov. 26, 2009, at Manila’s Quezon City in the Philippines. A Quebec forensics company promised millions of dollars in bribes to officials in the Philippines, including a cabinet minister and his brother, as it sought lucrative police contracts, according to a statement of facts attached to a deal the firm struck to avoid prosecution in Canada. THE CANADIAN PRESS/AP/Bullit Marquez
By Darryl Greer
A Quebec forensics company promised millions of dollars in bribes to officials in the Philippines, including a cabinet minister and his brother, as it sought lucrative police contracts, according to a statement of facts attached to a deal the firm struck to avoid prosecution in Canada.
The deal between Ultra Electronics Forensic Technology Inc. and federal prosecutors has been approved by the Superior Court of Quebec and is Canada’s second remediation agreement — also known as deferred prosecution — since the mechanism was added to the Criminal Code in 2018 to address corporate wrongdoing.
The other deal was struck between Quebec provincial prosecutors and SNC-Lavalin over corruption in its contract to refurbish the Jacques Cartier Bridge in Montreal.
The latest agreement requires the Montreal firm to pay about $10.5 million, co-operate with investigations, report to prosecutors about implementing the agreement and abide by an anti-bribery and corruption program overseen by an external auditor hired at the firm’s expense.
The court approved the deal with Ultra back in February but it wasn’t until May 16 that it released the ruling, a copy of which was obtained by The Canadian Press.
The firm sells ballistic identification technology to police forces all over the world to help solve gun crimes.
“We welcome the approval of the remediation agreement related to a historical contract in the Philippines,” Ultra CEO Alvaro Venegas said in an email.
“No one implicated is involved with the company today. The conduct in question occurred more than five years ago, and we have since put in place significantly enhanced management, culture, systems and controls.”
In September 2022, the RCMP announced fraud and bribery charges under the Corruption of Foreign Public Officials Act against the company and four of its executives, Robert Walsh, Philip Timothy Heaney, René Bélanger and Michael McLean. The cases against the individual executives continue, while the charges against the company are stayed and will be withdrawn if it complies with the remediation agreement.
The agreed statement of facts attached to the court’s ruling says two senior officers at the company were involved in a scheme from 2006 to 2018 to bribe Philippine officials to secure $17 million in contracts with the Philippines National Police.
Commission payments used to mask the bribery totalled just under $4.4 million, although the “exact amounts of bribes paid, and to whom they were paid, is not available in the evidence,” the statement of facts says.
But it says the bribes were “earmarked and promised to” public officials and others with “sufficient gravitas to exert some influence” on those involved in the procurement process.
The statement of facts says the public officials included Ronaldo Puno, who was secretary of the Department of Interior and Local Government from 2006 to 2010. It says Puno “was a key figure in securing the budget and ensuring the procurement of” the company’s flagship ballistics identification product.
The statement says that beginning in September 2006 through January 2018, two senior company officers enlisted the help of “commercial agent” Rizalino Espino in Manila to help lock down the police contracts.
Espino’s company, Concept Dynamics Enterprises, was to receive commissions on a percentage of any contracts, of which “a substantial portion” was intended as bribes.
The statement says Espino enlisted a pair of local businessmen to help with the bribery scheme because of their “close relationship” to Puno and his brother Rodolpho Puno, who was chairman of the Philippines Road Board at the time.
Espino, the statement says, agreed to “work his contacts to get the Puno brothers on board,” while another associate who was a retired police general worked contacts within the police force, including the chief and its logistic director.
The statement says that over 12 years, Espino and an associate were given “ample latitude” by Ultra Electronics’ employees “to work on the payment of bribes to public officials and their entourage.”
But the scheme unravelled after Ultra’s president received a letter in April 2018 from a former sales agent alleging corrupt practices.
By then, Ultra had been acquired by a new parent firm in the United Kingdom, and the company co-operated extensively with the RCMP and British authorities during the bribery investigation and also fired the employees involved in 2019.
The Public Prosecution Service of Canada issued a statement about the remediation agreement on May 17, saying Ultra would have to pay a penalty of $6,593,178, a surcharge of $659,318 and forfeit $3,296,589 “for the advantage obtained from the wrongful conduct.”
It says the Superior Court of Quebec “anticipates that approving this agreement will encourage corporations to voluntarily disclose wrongdoing.”
Prosecution service guidelines say that remediation agreements “are used in appropriate cases as an alternative to prosecution and serve as a means to hold organizations accountable while putting in place measures to mitigate the risk of future offences and harm to third parties, such as employees, victims and investors.”
Remediation agreements can only be struck with organizations and are not available to individual criminal defendants.
Their use was at the heart of a political storm in 2019 when former attorney general Jody Wilson-Raybould said she was improperly pressured by Prime Minister Justin Trudeau to allow a remediation agreement to be negotiated with SNC-Lavalin related to corrupt dealings in Libya. She refused to do so and attributed her subsequent demotion to this, which Trudeau denied.
A separate deal between Quebec prosecutors and SNC-Lavalin in 2022 saw the firm agree to pay $29.6 million over three years to settle criminal bribery charges stemming from bridge work in Montreal.
In the case of Ultra Electronics, the federal prosecution service struck the deal with the company shortly after the fraud and bribery charges were announced and the court approved the agreement in February.
The release of the ruling and statement of facts was held up as several details required redactions because of the ongoing cases against Walsh, Heaney, Bélanger and McLean.
Lawyers for Heaney, Bélanger and McLean did not respond to requests for comment.
Eric Sutton, who represents company founder Walsh, said in an email that “given that charges are pending, my client has nothing to say at this time.”
This report by The Canadian Press was first published May 31, 2023.
Innovation, Science and Industry Minister Francois-Philippe Champagne speaks to reporters in the foyer of the House of Commons on Parliament Hill in Ottawa on Tuesday, Sept. 19, 2023. Canada’s industry minister made a point of calling out Pepsi and Coca-Cola for not sending representatives to a meeting he convened on Monday with manufacturing companies to discuss stabilizing grocery prices. THE CANADIAN PRESS/Sean Kilpatrick
Canada’s industry minister made a point of calling out Pepsi and Coca-Cola for not sending representatives to a meeting he convened on Monday with manufacturing companies to discuss stabilizing grocery prices.
François-Philippe Champagne singled out the two companies when asked by a journalist what the consequences would be if major industry players did not succeed in stopping high inflation.
“This morning, (their CEOs) did not attend the meeting,” Champagne said of beverage giants Pepsi and Coca-Cola.
“I intend to call on them and I will continue to do so. … I don’t stop,” he told reporters.
The Canadian leaders of seven international manufacturing companies, including Nestlé and Kraft Heinz, met with Champagne.
He summoned them to answer to Prime Minister Justin Trudeau’s call earlier this month for Canadian grocers to come up with a plan to stabilize prices by Thanksgiving.
If major grocers fail to deliver ideas, Champagne said, “the consequence is for all 40 million Canadians because we will be able to see who is taking action and who is not.”
A government source told The Canadian Press that the CEOs of Pepsi and Coca-Cola responded to the federal government summons by stating they were not available Monday. The source was granted anonymity because they were not allowed to speak publicly about the matter.
It’s unclear, however, whether another meeting between major food companies and the government will take place.
Monday’s meeting brought together top Canadian executives from McCain, Unilever, Nestlé, Lactalis, Lassonde, Kraft Heinz, and Smucker Foods.
All avoided speaking with journalists. The CEO of the Food, Health & Consumer Products of Canada association, Michael Graydon, attended the meeting and agreed to answer questions on their behalf.
Graydon called the meeting “very productive.”
”We’re very much about co-operation and support, collaboration,” he said. “It’s an industry that needs to align and work collectively to find a solution.”
He said manufacturers want to collaborate with other players in the supply chain, such as major retailers like Loblaw and Costco, whose leaders Champagne met with one week earlier.
In a statement, Pepsi said it is open to meeting with Champagne.
“We are pleased that our industry association, FHCP, led a productive conversation with the government and representatives from industry today,” it said.
“We were not able to attend today’s meeting, but we offered to meet with the minister. We are committed to collaborating with the government to identify solutions during this challenging time for Canadians.”
Trudeau has said that if the government isn’t satisfied with what major grocers come up with to stabilize prices, he would intervene, including with tax measures.
Graydon said it remains to be seen how detailed the plans will be by the government’s Thanksgiving deadline.
”We’ll have to see whether, you know, the detail of how much completeness can be done by that time. But I think everybody’s working very hard to achieve that,” Graydon said.
Champagne said he is happy Graydon “wants to do something,” because “it’s a gain for Canadians.”
“It’s clear that what’s important is that we have timelines, work plans, and obviously concrete actions,” the minister said.
This report by The Canadian Press was first published Sept. 25, 2023.
Toronto
The Canadian payment processing firm Moneris confirmed Saturday that credit and debit card transactions were interrupted by a network outage earlier in the day.
The Toronto-based technology company issued a statement saying there was nothing to suggest the outage was related to a cyber attack.
Complaints about outages started rolling in to the Downdetector.ca website before noon eastern time, but Moneris did not say when the outage started.
About three hours later, Moneris posted a message on X — the social media site formerly known as Twitter — saying it had resolved the network problem.
It remains unclear how many businesses and transactions were affected, but data provided by Downdetector.ca indicated complaints had come in from across the country.
In a statement provided to The Canadian Press, the company said the outage lasted about 90 minutes.
“We have resolved the network outage and returned transaction processing to normal,” the statement said. “We continue to investigate the root cause of the issue. There are no indications this appears to be cyber-attack related and all transaction systems are functioning normally again.”
The company, a joint venture between Royal Bank and BMO Bank of Montreal, said transaction processing could be slow as its systems catch up with the backlog.
Moneris says it supports more than 325,000 merchant locations across Canada.
This report by The Canadian Press was first published Sept. 23, 2024.
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