City lawyer grills former CAO about bribe accusations at Winnipeg police HQ inquiry
CBC
Winnipeg’s former chief administrative officer was pressed on Wednesday about accusations he took a bribe from the contractor responsible for the city’s troubled police headquarters project — accusations Phil Sheegl maintained were untrue, contrary to what a Manitoba court determined four years ago.
City of Winnipeg lawyer Michael Finlayson made a number of suggestions to Sheegl during Wednesday cross-examination at the ongoing public inquiry into the headquarters project, including that Sheegl took money from Caspian Construction’s Armik Babakhanians as "incentive" to help the firm, which ended up securing the contract for the headquarters.
Finlayson suggested Sheegl then tried to cover it up when that money came to light around 2017, by saying the payments were linked to a land deal in Tartesso, Ariz., involving Sheegl, Babakhanians and former mayor Sam Katz, in an attempt to "fend off" possible criminal charges as RCMP investigated the project.
The inquiry was shown evidence of two payments Babakhanians made: one to Sheegl for $200,000 in 2011, and another to Katz for $127,200 in 2012. Both Katz, who testified at the inquiry last week, and Sheegl said that money was split between them as Babakhanians’s payment for the Arizona land deal.
The inquiry previously heard the $200,000 cheque to a Sheegl-controlled company from a Babakhanians-controlled company came on July 22, 2011 — two days after city council granted Sheegl the authority to award the police headquarters construction contract.
Finlayson told the inquiry the payment of $327,200 "had nothing whatever to do with a property in Arizona called Tartesso, or the sale of an interest in Tartesso."
"You are totally incorrect," Sheegl replied, vehemently denying Finlayson’s series of allegations, which he described as false and "completely wrong."
Finlayson told the inquiry the city’s belief about what happened would explain why there were no communications about the land deal during the time period in question, despite the many email exchanges between Sheegl and Babakhanians, and why Sheegl didn’t tell his other business partners about the deal at the time.
Finlayson also alleged the reason one of the documents detailing the Tartesso deal is dated May 2012 is because Sheegl forgot the first payment was actually made a year before — an allegation Sheegl denied.
Finlayson’s comments to the inquiry come after a 2022 Court of King’s Bench decision that Sheegl accepted a bribe and breached his duty as a city officer by accepting $327,000 from the contractor.
Chief Justice Glenn Joyal's decision said the Tartesso deal "was a concocted story," made up in 2017 after an RCMP investigation uncovered $327,200 in payment from Babakhanians.
That decision, which ordered Sheegl to pay the city roughly $1.1 million Cdn, was upheld by the Manitoba Court of Appeal the following year.
The exchange between Sheegl and Finlayson happened during the second day of Sheegl’s testimony.
The public inquiry began earlier this month and is expected to examine the circumstances surrounding the police headquarters project and determine the measures needed to restore public confidence in the city's ability to build large, publicly funded projects.
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