Federal competition watchdog hopes to sink teeth into Quebec corruption actors

MONTREAL--The corrupt actors in Quebec's construction industry can add this concern to a list that already includes possible criminal charges, a public inquiry and unwanted notoriety: there's also a federal watchdog hoping to sink its teeth into them.

The Competition Bureau of Canada says it is looking into the scandal-ridden industry. It is working with provincial anti-corruption authorities on a number of cartel and bid-rigging cases under investigation across the province.

The bureau says it is also keeping tabs on testimony at the province's Charbonneau inquiry, where witnesses have alleged widescale bid-rigging and collusion between construction companies with Mafia ties, civil servants and political party fundraisers.

"Investigating bid-rigging is one of the Bureau's criminal enforcement priorities," said Phil Norris, a Competition Bureau spokesman, in an email. "The Bureau will not hesitate to take action when it uncovers evidence that the law has been broken."

The federal body investigates suspected anti-competitive practices and is responsible for applying the Competition Act, which sets out potentially hefty fines and prison sentences.

Those convicted of conspiring to fix prices face fines of up to $25 million and up to 14 years in prison. Convictions for bid-rigging, meanwhile, carry fines that come at the discretion of the court and a maximum prison sentence of up to 14 years.

None of the testimony from the Quebec inquiry can be used to build a case.

The Charbonneau commission, which is supposed to file a report by 2013, has granted witnesses legal immunity during their testimony.

But the information currently being dug up by police bodies could prove to be an investigative goldmine. The Competition Bureau has been involved in recent raids and seizures by Quebec's anti-corruption unit.

That squad, known by its acronym UPAC, has focused part of its attention on Laval, Que., the province's third-largest city, in recent weeks.

Gilles Vaillancourt, who became the second Montreal-area mayor to step down in the last week, has been targeted with several raids by the unit.

The federal bureau won't specifically say whether it was involved in the Laval raids.

"We have been working in partnership with UPAC on joint investigative files, we have participated in numerous searches, and have had an embedded officer in the joint task force since these allegations came to light," Norris said.

In March 2009, the Competition Act was amended to dramatically increase the penalties for bid-rigging. Before that, the bid-rigging provisions called for prison sentences of five years and fines at the discretion of the court.

The allegations being heard at the Charbonneau Commission are raising questions about whether the bureau has enough resources at its disposal.

The Opposition New Democrats said this week that the bureau should have more resources. Only a small fraction of the bureau's employees are based outside Ottawa.

"Collusion is an anti-competitive practice which is the exclusive responsibility of the federal government," NDP Leader Tom Mulcair told reporters in Ottawa. "The personnel necessary to apply this aspect of the Competition Act is clearly inadequate and the federal government should look at this aspect of its responsibility."

Norris wouldn't discuss staffing for Quebec and said investigations are confidential.

A number of charges have already been laid this year in various Quebec cases where the bureau participated. The collusion cases have involved sewer, ventilation and public works project.

In one case in St-Jean-sur-Richelieu, Que., there were 77 criminal charges laid in June against 11 people and nine companies allegedly involved in rigging bids for contracts for road construction, water plants and infrastructures projects. Bid-rigging charges under the federal Competition Act were also laid. Those alleged crimes dated back to 2007.

Another case involved corruption in the building of a hospital in Chicoutimi, Que., took several years to wind its way through the legal system. The work was completed in 2003, charges were laid in 2008 and fines were doled out just this year.

The probes can take a while.

"Price-fixing and bid-rigging are, because of their secretive nature, difficult to detect and prove," Norris said.

The bureau offers immunity or leniency to people who come forward right away and co-operate on cases that haven't yet been detected, or who provide evidence that leads to criminal charges.

Mulcair said the organization needs more employees. While over 400 people work for the bureau, more than three-quarters are based in the Ottawa area and the rest are spread across seven regional offices throughout the country.

Mulcair called the resources "grossly inadequate."