Karma
Tories may have taken $2M in illicit donations
Updated Wed. Jun. 28 2006
6:13 PM ET
Canadian Press
OTTAWA -- The Conservative party may have illegally accepted millions in unreported donations last year because it didn't understand political financing laws.
That's the startling conclusion drawn from testimony given to a Senate committee by the Harper administration's point man on cleaning up government.
Treasury Board President John Baird has told the committee that his party did not consider fees paid to attend its March 2005 policy convention to be political contributions.
But the Elections Act stipulates that convention fees do constitute a donation.
The Tories' 2005 convention was attended by about 2,900 party members, who paid a regular fee of $600 each, although discounts were available for some.
That means the party stood to rake in as much as $1.7 million, all or some of which should have been reported to Elections Canada as donations.
I'm willing to bet this would have gotten more than minor story status had it been the Liberals involved in it.
posted by calgarygrit at
7:54 p.m.
51 Comments:
Sorry Sean:
Political parties hire lawyers to interpret the election financing laws for them, so that they can legally maximise their donations while avoiding "errors" like this one.
If their lawyers missed this one then they are imcompetent and that begs the question of what other "errors" may be lurking in the Conservative Party election financing closet?
Then again, maybe they did not miss it, which then begs the another question of why are they admitting to it now?
Should we be looking for a report coming out from Elections Canada in the coming days or weeks regarding Conservative Election Financing?
As well Sean, I thought Conservatives were supposed to be more ethical that Liberals. If that is the case I would think that you would be pissed off at the admission that the Conservative Party took illegal donations regardless of the circumstances.
By
ottlib, at 9:11 p.m.
Shhhh. Don't tell anyone. We'll save this for the next election campaign.
By
Havril, at 9:15 p.m.
Takes Harper down off his high horse a bit.
And frankly, if people come to think that the CPC is corrupt as the Libs, then the Libs win on policy.
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bigcitylib, at 9:17 p.m.
Takes Harper down off his high horse a bit.
And frankly, if people come to think that the CPC is corrupt as the Libs, then the Libs win on policy.
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bigcitylib, at 9:18 p.m.
There's one big difference - the Liberals intentionally and systematiaclly scamed the taxpayers out of our money. They set up a massive money laundering program and stole possibly tens of millions of dollars to enrich themselves. The tories may have misinterpreted election laws, were to the first to admit it - the story broke because John Baird told this to the Senate Committee. The money the Tories got was not from taxpayers, but from willing donors. There are loads of differences, but the if they made a mistake the Tories should pay back the money, and that's the end of it.
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Anonymous, at 9:20 p.m.
Well, obviously this was more incompetence than intentional deception. It's still going to be a black mark on Harper though and should make everyone a bit more sympathetic to Liberal concerns about the Accountability Act causing problems for the Lib convention.
matt; My hunch is this won't turn into a huge story, but I've been wrong before. It'll be interesting to see how the different parties handle it.
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calgarygrit, at 9:22 p.m.
And when I said it would be bigger if the Liberals were involved, that's just common sense. It's the same reason abortion stories carry more weight when a Tory is involved than a Liberal.
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calgarygrit, at 9:31 p.m.
I'm mad as hell! How do we know $1.7 million is the proper figure? I bet it's just the tip of the iceberg! We need a judicial inquiry! The government should sue the Cons to get back every penny. Just $1.7 m, how did we get that figure? Did the Con party negoiate that with the Con party? No conflict there. Did they pay it back? Show me the cancelled cheque! Wait until the Liberals get into government and can open up the books, boy, then we'll get the full story!
Gee, that was fun!
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Jeff, at 9:43 p.m.
What the Puck, Andrew Smith:
The other huge difference. The Conservatives ran an election campaign where their central theme was they were more honest, ethical and law-abiding than the Liberals.
Now by their own admission they have broken the law. They broke the law that governs the collection of money to run political parties and their elections, which strikes to the very heart of that central theme.
On its own, this little revelation would be quite meaningless but the memories of the Conservatives election campaign are still fresh in the minds of Canadians so the revelation could have a much greater impact.
The only thing that they might have going for them is the fact it is the beginning of the summer and most Canadians are not paying attention. Very convenient timing don't you think?
Which begs yet another question, when did they find out about this situation? Yesterday, last month, last year, two years ago?
For Liberals, they should be asking that question until they get an answer backed up by independently verified documentation.
They should also be asking how much of that illicit money benefited the Conservatives in both the 2004 and 2006 elections? $2 million dollars goes along way in election campaigns and things might have been different if they did not have this money during those campaigns.
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ottlib, at 9:44 p.m.
bcer in TO:
Feel better now?
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ottlib, at 9:47 p.m.
If they're wrong, they pay the price, literally and figuratively. On the other hand, I wouldn't get too far ahead of things.
It all depends on the costs of the event. If the cost per member was less than $600.00 then they have a problem. If the event cost more than $600.00 per, then there is no issue. It's only considered a donation if the amount collected exceeds the cost to host the event.
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WE Speak, at 10:21 p.m.
what the puck? How did the Liberals sweep Adscam under the rug? They called in the RCMP, the AG, and then a judicial inquiry.
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calgarygrit, at 10:22 p.m.
Ottlib, little bit, thanks.
So they should have gone the Liberal route and tried to sweep it under the rug and pretend nothing happened?
If asking the AG to investigate, calling in the RCMP, calling a judicial inquiry, addressing the nation on live TV and going on a cross-country "Mad as Hell" tour is sweeping it under the rug and pretending nothing has happened, I'd be interested to see sweeping it onto the rug and pretending something has happened.
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Jeff, at 10:24 p.m.
"According to a lawyer representing the Conservative Party the convention did not make a profit and as such none of the $600 convention fee can be considered a donation".
Well, according to Elections Canada that's not how the law works. That's the WHOLE POINT!!! The Conservatives didn't follow the law. Now, perhaps that's because they got bad (indeed TERRIBLE) advice from their lawyers, and that's a mitigating circumstance, but it doesn't change the fact that they broke the law. And I hate to tell you, but Conservative party lawyers don't get to determine what Canadian Elections law does or does not mean.
Whether or not the convention made a profit is completely immaterial. I can have a political convention and take in $100,000 from each delegate and still not make a profit. Cars and Cristal for everyone and we won't make a dime(!) Not turning a profit on the convention means NOTHING.
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Lord Kitchener's Own, at 10:56 p.m.
I was at that Convention.. and I didn't consider it a donation. At the time I thought I was paying for the convention costs.
I still say that's the way it should be. Only the portion that is profit on a convention should count as a donation... for any party.
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Michael Fox, at 10:59 p.m.
.. and another thing.
If they do determine it was a donation, all the better for me - because I'm going to get a bigger tax refund.
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Michael Fox, at 11:02 p.m.
I should also say that, should that Conservative lawyer's interpretation of the law somehow, by some miracle actually hold up, well, first, I'll lose what little faith I have in our political system.
But second, I can't wait to see the party that the Liberal convention will become. Because the Tories' argument seems to be that if you're staging a political convention you can take in as much money as you please, from whomever you please (even corporations, even if it's illegal to accept donations from corporations) and as long as the Convention doesn't make a profit you don't have to declare any of the money as "donations".
Bring on the dancing girls and Rolexes!!!!
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Lord Kitchener's Own, at 11:04 p.m.
The fun thing is that this probably wouldn't have come into the open if not for the issues around the Liberal convention and the accountability act.
If that Globe story showing the different interpretations of whether or not convention fees are considered deductible doesn't see the light of day, no one looks into this.
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calgarygrit, at 11:12 p.m.
Seriously though,
I always thought the portion that counted as an expense wasn't a donation. That's the way it works everywhere else. It'd be silly otherwise.
And quite frankly, if Liberals want to spend their *own* money on "dancing girls and Rolexes", that's up to them.
As long as nobody's claiming any of this against the taxpayers, I really don't see the problem. If I spend $600 on a convention and they use the money to rent a convention hall, etc. why should I get a tax writeoff for that? It's not a donation.
Are you guys seriously claiming that these should be donations. Do you realize that would mean the taxpayer would be footing part of the bill for our conventions?
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Michael Fox, at 11:18 p.m.
As a person filling out a tax return, if you filled it out wrong, due to violations of the elections act, are you to blame for filling a false return aswell? It is common in other parties that the amount is tax deductable. Plus that the convention (delegates that elected the party exec) is like shareholders, they are responsible for actions of the party (corporation) so it is their fault the lawyers the exec appointed screwed up.
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Concerned Albertan, at 11:22 p.m.
What the Puck - if we had covered up Adscam, there wouldn't have been the Gomery inquiry, and Martin wouldn't have hyped it up to demonstrate a spilt from the previous PM after the media had dropped the story.
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Concerned Albertan, at 11:23 p.m.
LKO, when 'Elections Canada' is represented by a spokesperson in a month old story about the Liberal Convention, I would take it with a grain of salt. It would certainly be interesting to hear the opinion of the Chief Electoral Officer and Election Commissioner.
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WE Speak, at 11:25 p.m.
TO tory, the law is the law, just because it doesn't make logical sense to you doesn't mean its not breaking the law.
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Concerned Albertan, at 11:25 p.m.
toronto tory,
Good points (and all that "bling" stuff was hyperbole on my part to make a point of course) but at the same time, how can one claim that allowing people (or worse corporations) to give seemingly unlimited amounts of money to a political party to make their political convention a kick-ass party does not constitute undue influence on said politicians??? How can the mere fact that a convention doesn't make a profit absolve politicians from the stain of holding a huge party funded by people who have already donated the maximum amount they're allowed to under the law, so they get around that fact by paying for the "expenses" of the party's convention. I'm not suggesting the Tories spent this 2 million dollars on hookers and blow, but the extreme example does show why this interpretation of the law is problematic, doesn't it???
If the Tory interpretation is correct, is there anything to stop political parties from holding a "policy convention" every six months to allow wealthy citizens and corporations to wine and dine politicians for a week? I just don't see how the making of a profit can possibly be the standard. I'd imagine it's pretty easy to spend other people's money without having any left over at the end as "profit", and is that OK with everyone??? Is that accountable and ethical government?
It's OK to take money from anyone, in any amount, as long as you spend it all before the convention's over?
Really???
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Lord Kitchener's Own, at 11:42 p.m.
Calicos' post makes this all make a little more sense.
But I'd still like to know what goods and services the ticket buyers received that were worth $600. Surely that must be declared somewhere no?
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Lord Kitchener's Own, at 11:45 p.m.
Sean, Andrew, WTP: Do you consider "the Liberals stole money first" to be a defense? How does that change anything about the fact that the Conservatives, intentionally or otherwise, seem to have broken election laws to the tune of $1.7 million? Try a bit harder.
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Dale, at 11:46 p.m.
If federal political finance regulations were like Alberta regulations, this wouldn't even be an issue.
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daveberta, at 12:10 a.m.
Well, according to Elections Canada that's not how the law works. That's the WHOLE POINT!!!
Actually it is not. A convention must make money for anything to be considered a donation. Given the cost of the convention, to the CPC, it is not yet known how much, if any, of the 1.7 million collected could be considered. Furthermore, the CPC indicated on the registration form that part or some of the fee may be considered a donation.
Once the facts come out, your rant, LKO, may come back and bite you in the ass.
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eastern capitalist, at 12:48 a.m.
I don't think this issue will become very big for a couple reasons.
First of all, it seems that legally the Conservatives are on solid ground. If the convention didn't make a profit as their lawyer indicates then 100% of the so called 'convention fee' is not a donation.
My prediction will be that in a week or so Elections Canada will come out and state that clearly. If the real expenses for a convention outweigh income, then there is considered to be no donations.
This is kinda what has been said here as well regarding the Liberal convention previously.
Secondly, the timing was bad and no one is really paying any attention. And people who are paying attention are either a) determined that Harper is the devil in disguise or b) determined that Harper can do no wrong.
The lines about 'illegal donations' is a bit of hyperbole and '$1.7million' is an inflated figure.
Third reason.. good night all!
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Eric, at 12:57 a.m.
I've got a ticket to a Conservative fundraiser later this summer. It cost $100. I was told when I bought it that I would get a tax receipt for around half of that, because that's the portion that's over and above the cost of hosting the event, and that's the only part that counts as a donation.
I can't find anything in the Elections Act that refers to "conventions" at all, leading me to believe that they are treated like any other fundraiser, under the rules quoted by Calicos.
In short, the Liberals (and the Canadian Press) are out to lunch.
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The Invisible Hand, at 1:24 a.m.
I attended a BBQ last summer, $15/person, $0 donation. Why would a convention be any different?
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Candace, at 2:02 a.m.
I think the law should be off the profit. So if a convention costs 500$ to put on and you charge 600$, you get a 100$ receipt.
But according to elections Canada, this doesn't appear to be the case. Even if the law is stupid, breaking the law is still breaking the law.
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calgarygrit, at 2:25 a.m.
You think when you get into the millions someone would ask for a second opinion.
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Dan McKenzie, at 2:30 a.m.
But according to elections Canada, this doesn't appear to be the case. Even if the law is stupid, breaking the law is still breaking the law.
Again, from the story in question:
Furthermore, a spokesman for Baird said Elections Canada audited and approved the party's convention books.
If that is true, Elections Canada would have seen the convention's revenues and expenses, acknowledged the fact that it did not run a profit, and thus certify that the fees collected do not constitute donations.
Meaning that if they confirm it, this is an absolute non-issue.
If Elections Canada says otherwise, the Liberals will have cause to celebrate. Not until then.
The one way the Liberals can benefit from the Tory version of events being confirmed is that it severely weakens the case for making the Liberal convention fees count as donations.
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BL, at 4:04 a.m.
I don't think many understand the laws.
It makes sense that costs have to be covered and the excess becomes a donation, but common sense and law are not the same.
Confusion abounds everywhere.
What about the registration fees charged to leadership candidates?
The $50,000 is to pay for...?
Going by what some are saying this makes for a very sizable donation which is well above the $5400 dollar limit, or does this money only cover costs? What if any is left over?
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Ardvark, at 4:17 a.m.
How is this different from the Liberals who have donated $5400 to leadership campaigns and then plan to attend the convention this fall?
Will this not put them over the donation limit too?
Liberal press won't push this because they realize it will bite the Liberals in the ass more than the Tories who have more than enough money to pay back the $2 Million.
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trustonlymulder, at 6:06 a.m.
To all of those folks that stated the Conservatives did not break the law I have one thing to say.
Justice John Gomery exonerated Prime Minister Paul Martin and his cabinet!
Did it matter? No! Because in politics preception matters more than reality. So, all of the legal interpretation of the law in this post is meaningless.
What matters will be the preception of Canadians to this issue.
If Canadians perceive it to be wrongdoing on the part of the Conservatives, the government will have its first scandal and the Conservatives are screwed.
If they perceive it to be no big deal then it will fade away.
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ottlib, at 8:28 a.m.
Two million worth of scandel when the WERENT EVEN IN POWER! I think I shall troll by the blog of every blogging Tory today and let them know the depth of my righteous outrage.
By the end of summer we'll see a CPCer caught t-boning a hooker on the lawn of the parliament building, I swear.
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bigcitylib, at 8:35 a.m.
Ignorance of the law is not an excuse to a crime. That is a cornerstone of our justice system. At least when illicit money ended up in LPC coffers they could make a case for honest mistake of fact.
That an entire political party could misinterpret campaign financing laws in such a way seems ridiculous to me. I would think this would be one of the first things that they would think of when they schedule the convention!
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KC, at 12:02 p.m.
CG, according the the Tory's lawyer, the profits are the only thing considered to be a donation. I believe this differs from the Liberal policy where (to my understanding) all payments to the party are recorded as donations and from there expenses are paid out.
All in all, its more or less an accountants' debate though...
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Eric, at 12:13 p.m.
This comment has been removed by a blog administrator.
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Tybalt, at 1:25 p.m.
"I think the law should be off the profit. So if a convention costs 500$ to put on and you charge 600$, you get a 100$ receipt.
But according to elections Canada, this doesn't appear to be the case. Even if the law is stupid, breaking the law is still breaking the law. "
CG, please provide a link. All the sources that I'm looking at all state that it's the portion after expenses that counts.
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Michael Fox, at 2:29 p.m.
"408. If a fund-raising activity is held for the primary purpose of soliciting a monetary contribution for a registered party, a registered association, a candidate, a leadership contestant or a nomination contestant by way of selling a ticket, the amount of the monetary contribution received is the difference between the price of the ticket and the fair market value of what the ticket entitles the bearer to obtain."
That seems pretty clear to me.
Looks like the Liberals are going to have egg on their face with this one.
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Michael Fox, at 8:42 p.m.
The primary purpose of a policy or leadership convention is to choose policy, or choose a leader, not to “raise funds” for the party, therefore exempting any bona fide convention from having its fees qualify as donations. The French version of the statute is even more clear: “dans le cas où une activité de financement est organisée essentiellement pour recueillir des contributions monétaires” (literally translated as “where a financing activity is organised essentially to receive monetary contributions”).
Except if you actually went to the Convention, the registration forms themselves stated that it was a fundraising event, and as such a portion of the fees paid could be constituted as a contribution and a reciept would be issued.
Add to that that yesterday the CPOC officials were chanting about section 408 - which deals specifically with fund-raising.
Sorry Matt... that dog won't hunt.
And why are they lying about the Convention Books having been audited and approved by Elections Canada? Care to try and explain that lie away?
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Somena Woman, at 2:08 a.m.
73 comments and it*s only a slim straw.
Oh, but it*s ever so satisfying a straw to grasp at.
Have fun guys. Subtract convention costs from the 1.7 M$ and rip with the difference if any, but try not to look too small.
On second thought, better forget about it as this makes other Scam numbers look MASSIVE, by comparison.
Sorry, but it*s hard to be modest and tactful after thirteen years of injustice. TG
By
TonyGuitar, at 9:03 a.m.
PS. Anyone recall the 200+ scamslist of December 5th?
Google; Scamslist and get this:
http://bendgovernment.blogspot.com/2005/12/httpscamslistblogcom.html
0r http://scamslist.blog.com TG
By
TonyGuitar, at 9:13 a.m.
Pick a scam, any scam. Say scam number 196.
196 is the DND computer system for materials tracking fiasco that may not be useful until 2011 and has bloomed to about $147 million.
There are about 200 others to choose from.
See why this topic may not be a winner? TG
By
TonyGuitar, at 9:30 a.m.
""a portion of the fees paid could be constituted as a contribution and a reciept would be issued.""
because it was NOT a fund raiser, any money made over & above costs would have to be considered a donation and receipt given, the PURPOSE of the Conservative Convention was not to raise money, the Liberal Convention has the appearance of a fund raiser when the fees are double a Cons convention. But it does seem to cost the Libs twice as much as the Cons to do anything. So maybe it is not a fundraiser...?
""And why are they lying about the Convention Books having been audited and approved by Elections Canada?""
Is it possible they were referring to other years where the books were audited, or scrutinzed by Election Canada? Maybe audit is not the proper word and should be corrected by the CPC
By
wilson, at 2:33 p.m.
and the plot thickens:
June 30, 2006
Canada Revenue Agency
Enforcement and Investigation Section
To Whom it may concern:
Re: Improper Issuance of Political Contribution Tax Receipts
We wish to bring to your attention that the Liberal Party of Canada has publicly acknowledged that it has apparently been issuing political contribution tax receipts for 100% of the price of admission to Liberal Party functions where the ticket buyer receives significant personal benefits - for meals, drink, entertainment and the like.....
Yours truly,
Mike Donison
Executive Director, Conservative Party of Canada
http://davidakin.blogware.com/blog/_archives/2006/6/30/2077437.html
By
wilson, at 9:00 p.m.
Wilson said;
And the plot thickens.
Plot?.. What plot?
For that one must consult with thew experts.
The Librano$! TG
By
TonyGuitar, at 4:02 a.m.
Ahem...
http://tinyurl.com/gg3as
Tory Cheque-Swapping Scheme Allegedly Allowed Improper Tax Benefits
Barbara Yaffe, CanWest News Service; Vancouver Sun
Published: Saturday, July 01, 2006
VANCOUVER - Conservative party officials engaged in a "cheque-swapping" scheme that enabled delegates to get federal tax credits for donations that were not donations, according to e-mail correspondence of Conservative party delegates prior to a 2005 political convention in Montreal....
More available at above URL
By
Somena Woman, at 2:37 p.m.
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