Saturday, July 11, 2009

Dimitri Soudas and Leo Housakos Were Subject of Ethics Probe

This has been a bad week for Dimitri Soudas.

First he made a fool of himself and the PM over his handling of the Communion debacle; then fed his boss a quote that led to yet another venomous attack against Michael Ignatieff, only to realize that the quote was in error, forcing Harper to do something he never does. Apologize.

However, this period in his political life may not have been the first.

With friend Leo Housakos, he attempted to make backroom deals for political gain.

One was in a court case involving a Montreal businessman and the Government of Canada; and the second was an attempt to secure a military contract for a Conservative supporter in exchange for political favours.

Both Soudas and Housakos were the subject of an ethics probe, adding to the many scandals of a party that rode in on a promise to clean up government, but instead may well end up being the most corrupt.

PMO spokesman denies political interference
Aide was present in meetings with developer, military contractor
January 30, 2008
The Canadian Press

A joint investigation by the Globe and Mail and Radio-Canada is alleging that a member of the Prime Minister's Office and a Conservative fundraiser directly interfered in a pair of political dossiers.

The report, which aired on the CBC's French-language service on Tuesday night, alleges PMO spokesman Dimitri Soudas intervened in favour of a Montreal real estate developer currently embroiled in a lawsuit with the federal government, and sat in on a meeting with representatives of an international military contractor looking to sell its wares.

The report says Soudas directly intervened on behalf of Rosdev Group, a Montreal real estate developer currently embroiled in a multimillion-dollar lawsuit with the Public Works Department over the management of two office buildings that house thousands of civil servants.

The report also says Leo Housakos, a longtime Tory supporter and party organizer in Quebec, also intervened directly with the Public Works Department.

Rosdev's president, Michael Rosenberg, ran unsuccessfully for the Conservative party in the Montreal-area riding of Outremont in 2006.

Housakos told Radio-Canada he was trying to get the message across that it would be good for the government to help out Rosenberg, a party supporter.

Housakos said he never asked Soudas to intervene in the case. And Soudas said all he did was follow up on a question from a municipal councillor and send the file along to Public Works.

But sources told the television network that Soudas was attempting to buy time for Rosdev from its legal battles and to help a key Quebec political ally. Soudas, apart from his role as a spokesman, is also a key strategist for the prime minister on Quebec issues.

The report also says that Soudas was present during a meeting between Housakos and an unnamed military contractor looking for an edge in bidding with the government.

Housakos, also a former financial director for the Action Démocratique du Québec who was appointed to Via Rail's board of directors in December for a four-year term, was approached by the company. Soudas was also present at the meeting, the report says.

Prime Minister Stephen Harper's deputy press secretary told Radio-Canada that he did not breach any code of ethics by being present at the meeting. Housakos told the Radio-Canada reporter he had no recollection of the meeting and never received any money to do any lobby work. Housakos is not a registered lobbyist, the report says.

Another PMO aide in hot water
Harper brushes off allegations as staffer, party organizer accused of meddling in lawsuit
January 31, 2008
Sean Gordon in Montreal
Richard Brennan in Ottawa

Internal federal Conservative party rancour has spilled into public view amid accusations of arm-twisting and influence-peddling that have thrown the Tories' Quebec wing into disarray.

The ill will surrounds Dimitri Soudas, a spokesperson and Quebec adviser to Prime Minister Stephen Harper, and Soudas's longtime friend Leo Housakos, a Conservative organizer who was named to the board of VIA Rail late last year. (He was also one of 18 new senators appointed by Harper in December)

Opposition MPs say Soudas and Housakos interceded in a protracted lawsuit involving a Montreal property developer, Rosdev, and the federal government, pressuring Public Works officials to opt for mediation rather than litigation.

"The facts are that Dimitri Soudas, a spokesman for the Prime Minister, intervened on a government file. He ordered senior ministerial staffers, including a chief of staff, to attend meetings designed to influence a $50 million deal," Liberal MP Mark Holland (Ajax-Pickering) said in question period.

Soudas denied doing anything wrong, but conceded he made the unusual move of calling a meeting at the Prime Minister's Office in August 2006 to discuss the file.

"The file was looked into; as you may have noticed, the issue was before the courts at the time, it remains before the courts today and basically, no favours were exchanged," Soudas told reporters.

Even so, the New Democrats have asked Ethics Commissioner Mary Dawson to look into the matter.

The affair is further complicated by the fact the principals behind the development company are influential members of Montreal's Hasidic community, a constituency that has been ardently wooed by the Conservatives as part of a strategy to broaden the party's appeal to minority voters in Quebec.

Harper, who campaigned on bringing a new level of accountability and ethics to Ottawa, batted aside Commons questions from the Bloc Québécois, suggesting they had racial overtones.

"Mr. Speaker, the Bloc member mentioned the name of two people with Greek origins, an employee who works here in Ottawa and another who is a Conservative party supporter in Montreal. The fact they are two Montrealers of Greek ancestry does not mean there is a plot," he said. "This company didn't receive any benefits or special treatment," Harper said. (Harper was the only one who mentioned that they were Greek. That NEVER entered the into anything. He was clearly trying to imply to the Greek community that they were wooing, that the opposition parties were racist)

Duff Conacher, co-ordinator of Democracy Watch, said the imbroglio shows the hypocrisy of a government that vowed to clean up politics and end backroom deals.

"We are seeing from a government that promised to be honest, ethical, and open ... unethical behaviour and excessive secrecy. That is the definition in government terms of being hypocritical," Conacher said.

Housakos angrily denied any wrongdoing. "I'm a bit furious with a lot of people ... it's an inside job and that's what hurts the most," he told the Star. He didn't elaborate, but it's clear he and others see the revelations as a vendetta orchestrated by people hostile to Soudas.

Some allies point the finger of blame at Public Works Minister Michael Fortier, whose office has previously jousted with PMO insiders over policy and communications decisions. When asked about the Rosdev affair, Fortier said "there was no pressure put on me."

It's the second time in less than a week Harper's communications staff has been in the headlines. Sandra Buckler, Harper's director of communications, was forced to publicly admit to misspeaking when she told reporters the military had not informed the government it had suspended the transfer of prisoners to Afghan authorities.

The infighting is also symptomatic of a split within the Tory Quebec wing, where factions loyal to both the Quebec Liberal Party and the Action démocratique du Québec – the political home of Soudas and Housakos – jockey for supremacy.

Though Quebec Liberal Party stalwarts like Transport Minister Lawrence Cannon and Fortier had Harper's ear early on in the mandate, the situation has shifted.

Relations have cooled between Harper and Premier Jean Charest since the last provincial election, and the Tories have cultivated closer relations with ADQ Leader Mario Dumont. That made political sense last spring, when the nationalist, right-leaning ADQ surged to Official Opposition status and won in ridings coveted by the federal Tories. But a poll published yesterday showed Dumont has slipped 11 points behind the Parti Québécois and 7 points behind Charest.

Both men were eventually cleared but it shows a pattern of how these guys operate.

Back to - The Dimitri Soudas Story: And We Pay This Man a Salary, Why?

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