Tuesday, October 16, 2012

Challenges of Enforcing Electoral Finance Laws

Lino Zambito testifies in Quebec's corruption inquiry.
Quebec's corruption inquiry has yielded some very interesting findings. Lino Zambito, a former construction employer, testified about his illegal bribes of elected officials and illegal campaign contributions. In response to the Parti Québécois's pledge to reduce individual contributions to political parties, Zambito said such measures are useless, as they will only yield increased illegal contributions.

The FDA acknowledge that any laws are susceptible to being broken. Viz., there is no perfect law. However, to give into corruption (as Zambito alludes) appears to be a defeatist approach and undermines the basis for laws.

Further, in the FDA's Canadian provinces electoral finance study, Quebec scored the highest of all provinces with a 100 percent score. The FDA auditors did not find any deficiencies in the Quebec's electoral finance legislation. Quebeckers' contributions in one year to all parties and candidates are capped at $1,000. Therefore, the FDA believes that there is no room to lower the cap on contributions as the Parti Québécois pledges. Quebec's cap is already under 10 percent of Quebec's per capita income of $27,211. (The FDA, using its professional judgment, think that 10 percent of per capita income is a reasonable and fair amount to contribute and in light of all other expenses individuals incur.)

From the 2012 FDA Report on the Canadian Provinces:

The maximum amount for Quebecker contributions to parties and candidates by each donor cannot exceed $1,000 per year, and must be paid to the Chief Electoral Officer. However, an official party representative can accept cash contributions less than $100 but must record the donation. When the Chief Electoral Officer receives a contribution, s/he will publish the information relating to both the donor and the amount on its website (Quebec Election Act, Articles 91, 93, 93.1).

FDA Report on the Canadian Provinces Electoral Finance


Quebec corruption inquiry: Star witness says he donated illegally to every party
By Allan Woods Quebec Bureau (Canadian Press)

MONTREAL—The longtime mayor of Quebec’s largest suburb and a vice president with Loto-Quebec, the province’s gambling authority, were the latest names to surface in testimony at a high-profile corruption inquiry.

Star witness Lino Zambito, a former construction boss, testified that he paid a special $25,000 fee through an intermediary to Laval Mayor Gilles Vaillancourt as payback for a $2-million infrastructure project his former company was granted in 2002-03.

The former head of Infrabec said he spent endless frustrating hours trying to figure out how to get into the construction game in Laval, north of Montreal, before finally getting word that his time had come. Told to attend the grand opening of a furniture and appliance store owned by the Vaillancourt family one day, Zambito testified that the mayor approached and greeted him with the words that his wait was over.

“He just mentioned to me that the job is coming,” Zambito testified Monday. “The boys will tell you which one.”

Zambito has testified in previous days that the Italian mafia worked out which firms would win construction contracts in Montreal and collected a 2.5-per-cent tax. He alleged that Vaillancourt played the role of mob kingpin Vito Rizzuto in the municipality he has represented for more than two decades.

Quebec’s anti-corruption unit, which includes provincial police and tax inspectors, swooped down over the past week on several businesses in Laval as well as city hall and two residences belonging to Vaillancourt, in a major probe possibly related to Zambito’s testimony.

No charges have been laid and the mayor has denied any wrongdoing, saying he never received money from Zambito or Marc Gendron, executive vice president of the firm Tecsult Inc., who was named as the middleman for Vaillancourt.

In earlier testimony, Zambito recounted giving an envelope stuffed with $30,000 cash to Pierre Bibeau, a vice president at Loto-Quebec in April 2009.

“I sat down with him, gave him the envelope; we spoke about politics,” he testified.

The money was payment for a fundraiser 10 days earlier in Laval for then-Liberal environment minister Line Beauchamp, who was married at the time to Bibeau. Normally, Zambito would have friends, family and employees write cheques for a legitimate donation and reimburse them with his own funds. This time, he had run out of fake names to use and passed on the money in cash.

“It was easier than going to find fake names and do business with people I don’t know,” he testified.

He said he partook in the same sort of illegal political financing schemes for others, including Quebec vice premier Nathalie Normandeau, Labour Minister David Whissell and former families minister Tony Tomassi, a former construction boss, who was later forced to resign and now faces criminal charges of fraud and abuse of confidence.

The same sorts of demands came in from the Parti Québécois and the Action démocratique du Québec, two opposition parties at the time, though they received smaller amounts, Zambito said.

But the construction insider, who is facing criminal charges for some of the practices he has testified about, also had some advice for Quebec’s political class, including the governing Parti Québécois, which is promising to severely limit the amount of money individuals can donate to political parties.

Doing so, he said, will only assure the amount of undeclared “dirty money” in politics will increase.

“We’ll just create the need for more dirty money,” Zambito said. “It’s my perception from the experience I’ve had on the ground.”

Question for Readers:

Is electoral finance law a waste of time because of the prevalence of finance corruption?

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