SNC-Lavalin warned federal prosecutors last fall about a possible plan to split the company in two, move its offices to the United States and eliminate its Canadian workforce if it didn't get a deal to avoid criminal prosecution, newly obtained documents show.
The documents, part of a PowerPoint presentation obtained by The Canadian Press, describe something called "Plan B" — what Montreal-based SNC might have to do if it can't convince the government to grant a so-called remediation agreement to avoid criminal proceedings in a fraud and corruption case related to projects in Libya.
Under that plan, SNC would move its Montreal headquarters and corporate offices in Ontario and Quebec to the U.S. within a year, cutting its workforce to just 3,500 from 8,717, before eventually winding up its Canadian operations.
“The Government of Canada needs to weigh the public interest impact of the prosecution of SNC-Lavalin," the presentation reads.
"We must humbly ask whether the public interest is served to prosecute SNC-Lavalin, and to try to achieve a guilty verdict. Such a decision would effectively lead to the end of SNC-Lavalin as we know it today and has been for more than 100 years."
Of all the options for the future of the company, the plan in the presentation was the "most obvious" to follow and "well advanced" in terms of planning, say the documents, which the Privy Council Office confirmed receiving in late September, at the same time as prosecutors.
The company's board and senior management were prepared to quickly bundle parts of the business that had no role in the Libya case into a new entity, putting the "trio of possibly convicted entities" into another organization that would operate "on a reduced business level in Canada or heading into eventual wind-up," they read.
What people are reading
The details appear to contradict public statements by chief executive officer Neil Bruce, who has denied both that the company threatened to move its headquarters, and that the company cited its some 9,000 Canadian jobs as a reason the construction giant should be granted a remediation agreement.
The company walked back the comments days later in a statement, saying a remediation deal was the best path to protect its Canadian workforce.
SNC-Lavalin spokesman Nicolas Ryan confirmed the authenticity Thursday of what he called a "confidential document" that was submitted to the Public Prosecution Service of Canada to allow the director of public prosecutions to consider the company's request for an agreement.
"We have always been transparent with our various stakeholders about the importance of the public interest argument/case for Canada in having a globally competitive SNC-Lavalin as part of Canada, headquartered in Montreal," Ryan said in a statement.
A remediation agreement remains "the best way to protect and grow the almost 9,000 direct Canadian SNC-Lavalin jobs, as well as thousands of indirect jobs," the statement continues.
"We have also said that we have a fiduciary duty to our shareholders and employees, and as such is our responsibility to look at all our options available.... this does not mean that we have chosen one option or that a decision has been taken on which option we will pursue, simply that there are various possibilities we must consider."
The presentation, which was delivered by mail to The Canadian Press anonymously and without a return address, also suggests the end of seven-figure donations and sponsorships for various community causes, hundreds of millions more in lost tax revenues, and the loss of spending on research positions at universities.
Prime Minister Justin Trudeau has held up the threat of job losses as the main reason he and others pressed former attorney general Jody Wilson-Raybould to look into the prosecutor's decision.
Wilson-Raybould told the Commons justice committee last month she came under "consistent and sustained" pressure — including veiled threats — from Trudeau, his office, the Privy Council Office and Finance Minister Bill Morneau's office to halt the criminal prosecution of SNC-Lavalin.
The ensuing political fallout has cost Trudeau two cabinet ministers — Wilson-Raybould and former Treasury Board president Jane Philpott, who said she had lost confidence in the government's handling of the affair — as well as one of his top aides, Gerald Butts, and Michael Wernick, clerk of the Privy Council, who will leave his post as the top federal civil servant before the fall election.
Bruce and Wernick met on Sept. 18 about the company's legal troubles.
Notes taken at the meeting, tabled as evidence with the House of Commons justice committee, show that Wernick told Bruce to take the public interest argument to the director of public prosecutions, adding the company "will want to get it right."
Wernick testified earlier this month that he spoke with Wilson-Raybould the next day where the former attorney general appeared "very firm in her mind" that the prosecutor's decision to not negotiate a deal with SNC-Lavalin was final. Wernick said Wilson-Raybould told him the only option for the company was to make public interest arguments through its lawyers.
A spokeswoman for the prosecution service said any discussions or documents in the case are confidential.
A roller coaster ride of lies
A roller coaster ride of lies? Who do we believe anymore? An important date on the Calendar...Monday October 21, 2019.
We must humbly ask whether
We must humbly ask whether the public interest is NOT served to prosecute SNC-Lavalin, and to try to achieve a guilty verdict." Why would it not be in Canada's interest to rein in a corporate monolith that lies, and lies, and cheats, and corrupts public officials and foreign governments, and drags Canada's reputation as a country under the rule of law through its mud?
The legislation used in this prosecution, introduced by the Harper Government has been infrequently used and only rarely successful in its prosecutions. Is that legislation the best we can do? Is there an argument to be made for "remediation" when corporations make obvious and indictable offenses against Canadian law? Possibly - but it all depends. If that remediation involves very significant financial penalties, if the agreement includes required guarantees or restructuring by the corporation to eliminate its corrupt practices, if it ceases evasion of taxes, and its blackmailing extortion for favourable government treatment - then yes, the public interest is served - saving taxpayers the costs of litigation, eliminating the ongoing costs built into government funded projects that are used for payoffs/kickbacks and other criminal actions, even, perhaps, creating a leaner, more efficient, more productive corporation as a result.
SNC's plan B is the classic playbook of the psychopathic corporate entity that has abandoned all pretense of ethical behaviour, that has gleefully joined the "dark side" of organized criminal gang behaviour, that has put profits and share prices, ahead of any other guiding principle; probity, effectiveness, honourable conduct. These corporations may provide jobs, but in the process they cheat everyone, sometimes even their own shareholders. In truth this is the reigning global business model it seems, and we are all much the worse off becuse of it.
It is ironic of SNC to cite
It is ironic of SNC to cite their "fidiciuary duty to shareholders and employees" [note which category comes last!] in planning their battle strategy. They breached whatever fiduciary duty thay could speciously claim when they broke the laws against bribery both at home and abroad.
Quote: "It is ironic of SNC
Quote: "It is ironic of SNC to cite their "fidiciuary duty to shareholders and employees" [note which category comes last!] in planning their battle strategy. "
And what about THIS?
Sorry to keep bringing this up, but WHEN is someone going to investigate and report on this? And WHO?
Is 2019 finally going to be the "year of the whistleblower"? If so then it's about time - and it's actually overdue by decades.
Robert T. Chisholm, Ottawa
Associate Member, OSPE
Happy though I am to blame
Happy though I am to blame Trudeau for things, I thought from the start that that SNC-Lavalin executive guy was full of it. Big corporations always claim the sky will fall and all the jobs will disappear if you don't do exactly what they want; why would SNC-Lavalin be any different?
At the same time, I doubt Trudeau actually believed it. The way it works is, the corporates claim the deluge will come if you don't cut them another subsidy or whatever, you pretend to believe it so you've got a rationale to lean on when you pass a bad law or lean on the civil servants or dole out the cash, but the real rea$on you agree has to do with campaign donations and your personal chances of a directorship or top dollar speaking engagements after you've left politics. Conservatives are at least as bad as Liberals in this regard. If you want a government that won't do dirty deals for corporations, you have to vote for a party that's not pro-corporate.
At this point I'd say the best solution is, nationalize the bastards. In fact, I think that would be an excellent penalty for corporate wrongdoing--corporations found guilty of heinous acts have to issue a certain percentage of voting stock to the government, for free, and all future issues of stock must include a percentage for the government equal to its current percentage holdings (so you can't dilute the government's ownership). The government now has influence over the company and a new income stream as a shareholder, in effect making it harder for corporate criminals to completely evade taxes. Mess up enough times and the government is the new owner and let's see the blackmailing sons of bitches move the jobs out then!
My, that is convenient. Did
My, that is convenient. Did anyone check the file date?
The people of Canada are
The people of Canada are merely ants beneath the mountain of deals where we pay and the corporation gets the profits. Meanwhile mainstream media continue to gaslight the "offending" politicians who believe in the rule of law.