On December 17, 2018, a Quebec judge sentenced Yanaï Elbaz, a former McGill University Health Centre (MUHC) executive, to 39 months’ imprisonment for accepting CDN$10 million in bribes in return for helping Canadian engineering firm SNC-Lavalin win a CDN$1.3 billion building contract for MUHC. Previously, on November 26, 2018, Elbaz had pleaded guilty to receiving a bribe, breach of trust, conspiring to launder money with the former Chief Executive Officer of MUHC, Arthur Porter, and transporting or transferring the proceeds of a crime.
Elbaz had been the MUHC’s assistant director general of planning and real estate management and a member of the committee that decided which group would win the MUHC contract. At the time of his plea, Elbaz admitted
that he supplied SNC-Lavalin with insider information that allowed it to adjust its proposal on how the project should be built. He also used the position he held, between 2007 and 2011, to influence members of a selection sub-committee by praising the consortium led by SNC-Lavalin and denigrating the only rival bid made by another consortium.
Elbaz also admitted that he violated rules intended to keep the selection process impartial by communicating with Pierre Duhaime, then-Chief Executive Officer of SNC-Lavalin, and Riadh Ben Äissa, then a vice-president of SNC-Lavalin’s construction division, prior to submission of the MUHC bid. Subsequently, in July 2018 Äissa pleaded guilty in the case to using forged documents and was sentenced to one day in jail, given the 29-month sentence that a Swiss court had previously imposed for fraud-related charges relating to SNC-Lavalin’s business in Libya and additional time he had spent wearing a tracking device. Duhaime is now facing trial in the case in February 2019.
Note: Elbaz’s plea and sentencing is significant because it is one of the last milestones in a long-running case that Quebec authorities reportedly described “as the largest corruption fraud case in Canadian history.” Since 2012, when Swiss authorities arrested Äissa, and 2013, when the Quebec police anti-corruption unit issued arrest warrants for SNC-Lavalin executives, the record of law enforcement success in this investigation, designated as “Projet Lauréat,” can fairly be described as mixed, based on the following developments:
- In 2014, Porter’s wife Pamela Porter, who had pleaded guilty to money-laundering charges in the case, was sentenced to two years’ imprisonment. At the time, the Montreal Gazette declared her conviction “a first legal victory for the Crown after it pressed charges against eight other individuals” in connection with the MUHC contract.
- In 2015, Arthur Porter – who, with Elbaz, allegedly received a total of CDN$22.5 million in bribes for awarding the MUHC contract to SNC-Lavalin – died as a fugitive in Panamanian custody, having fought extradition to Quebec since his arrest in Panama in 2013.
- In 2016, prosecutors withdrew all charges in the case against Bahamian businessman Jeremy Morris.
- In 2017, former SNC-Lavalin financial controller Stéphane Roy was acquitted of fraud and using forged documents charges in the case, after prosecutors decided not to present any evidence against Roy.
- In 2018, at the time of Elbaz’s guilty plea, Elbaz’s brother Yohann Elbaz – who with his brother controlled a company through which Yanaï Elbaz’s $10 million in bribes reportedly passed – was acquitted after Crown prosecutors stated that they would not prosecute Yohann on charges of conspiracy, recycling the proceeds of crime and using false documents.
Even though the convictions of Elbaz and Äissa were significant developments, the outcome of the Duhaime trial may weigh heavily in any ultimate conclusions about the success of the MUHC investigation.
UPDATE: On February 1, Pierre Duhaime pleaded guilty in the case to a charge of helping a public servant commit breach of trust. The Quebec court judge reportedly accepted a joint recommendation from prosecutors and defense that Duhaime receive a 20-month suspended sentence, to be served under house arrest. Duhaime will also serve one year of probation and 240 hours of community service, and has been ordered to donate CDN $200,000 to a center that aids victims of crime.
An agreed statement of facts presented to the judge indicated that Duhaime was guilty of “wilful blindness” as SNC-Lavalin’s CEO, that he did not receive any money from the crime, and that he was not connected to and had no knowledge of the $22.5 million in bribes paid to Porter and Elbaz.