MONTREAL—On Wednesday, the Charbonneau Commission heard what it had long sought: Francois Perreault confirmed that as vice-president of powerful engineering firm Genivar he poured $300,000 into the coffers of former Mayor Gerald Tremblay’s party.

Although the contributions were common knowledge at the publicly-traded company, Perreault testified that he created a complex paper trail to hide the illegal payments from shareholders.

“Lots of people saw what was going on, no one asked questions,” said Perreault. He lost a workplace bonus of $100,000 after the scheme was uncovered and resigned last Friday.

The engineer said he knew a profitable price-fixing cartel established with the competition wouldn't last forever. Union Montreal fundraisers were greedy he told the commission, and engineering firms got, caught-up in the corruption.

“The system in Montreal was completely exaggerated and grew totally out of proportions,” Perreault testified.

When asked what should be changed, Perreault blamed Quebec laws that favour the lowest bidder, even for highly skilled engineering work.

“You can't conduct an engineering project at 50 per cent below normal rates without compromising quality.”

Perreault described a tragic system where projects attracted bids so low, that quality is affected, leading competitors to collude to fix prices.

While he admitted he did break the rules with the City of Montreal, he said all the rules were followed. The Commission had its doubts, with lawyers pointing out that cartels automatically eliminated the competition required to lower prices.

Earlier in his testimony, Perreault shed light on a system of fraudulent billing. He explained that companies routinely issued fake invoices to Genivar without rendering services. Those sub-contractors were obscure companies that frequently lasted a year or two before disappearing.

Previous witnesses had also detailed a system of false invoices, which were used to obtain funds required to make donations to political parties and for other murky activities.

Next to testify at the commission will be BPR engineer Charles Miller and then André Noël, a former investigative journalist for La Presse who later became an investigator with the commission.

—with a file from the Canadian Press.