Zampino quits engineering firm amid conflict scandal
Former Montreal executive committee member Frank Zampino, at the centre of a growing controversy over a massive water-meter contract, has resigned from the consortium at the centre of the case.
Zampino said Tuesday that he has quit as senior vice-president and chief financial officer at Dessau, that's part of the consortium whose contract with the city was frozen by the mayor pending an auditor's review.
Earlier this week Zampino confirmed that in 2007 and 2008, while he was still serving in the city administration, he vacationed on a yacht belonging to Tony Accurso, whose Genieau consortium later secured the water-meter contract.
The $356-million contract to build and manage the city's water meters was the largest such contract ever awarded by City Hall, but it later emerged that Montreal might have overpaid by up to $150 million.
Opposition politicians and even the mayor himself had mentioned a possible conflict of interest, but Zampino blamed the media for the firestorm.
"In the face of such ruthless media hostility towards myself ... my integrity is relentlessly and without any evidence under attack," Zampino said in a statement.
"This situation can be detrimental to the organization," he added.
Not long after he quit politics, Zampino took the job with Dessau. Zampino said that while he is a friend of Accurso's and did take the yacht trip, he covered all of his own costs when they vacationed on Accurso's yacht in the Caribbean.
He insists he did not intervene on behalf of Dessau while he served on the executive committee but admits the trip could have left a perception with the public.
"I've committed a blunder and I fully acknowledge it," he said in the statement.
"I should have refused the invitation. I now understand this was inappropriate under the circumstances and, if I were to turn back, I'd act differently."
Last Wednesday, mayor Tremblay announcement the suspension of the water-meter contract following revelations by the Canada Revenue Agency that three of Accurso's companies are under investigation for tax fraud.
Tremblay said the suspension will be in place until an audit is conducted.
The federal tax agency alleges Accurso's three companies -- Simard-Beaudry Construction Inc., Construction Louisbourg Ltee., and Hyprescon Inc. -- funneled $4.5 million to shell companies that provided receipts for fake contracts.
Simard-Beaudry Construction Inc. belonged to the consortium that was granted the contract.
The RCMP arrested two Revenue Canada officials during raids on six offices belonging to Simard-Beaudry Construction Inc. Another two Revenue Canada employees had also been suspended without pay.