(Ottawa) The Ministry of Public Services and Procurement in turn transferred information about GC Strategies to the Royal Canadian Mounted Police (RCMP) after conducting its own investigation into the allegations surrounding this company at the heart of the financial fiasco of ‘ArriveCAN. The firm has just lost its government security clearance and is therefore excluded from all federal contracts.
The fact that GC Strategies participated in developing the criteria for a tender that it then obtained without any competition raised a red flag.
This information was revealed a few weeks ago in a devastating report from the Auditor General on the explosion in costs of this application used in Canadian airports during the pandemic. The first version cost $80,000, but the project ended up costing taxpayers nearly $60 million.
“Sufficient evidence was found to establish that one of the senior managers of GC Strategies was no longer in compliance with the contract security program,” said Thursday the assistant deputy minister of the Directorate General of oversight of the Ministry of Public Services and Procurement.
The firm, which has only two partners, is the one that obtained the largest share of contracts awarded by the Border Services Agency (CBSA) for ArriveCANor 19.1 million according to the Auditor General’s estimates.
The RCMP has already opened an investigation after the CBSA provided it with information following its own internal investigation. Two officials, Cameron MacDonald and Antonio Utano, were suspended. They believe they have been victims of reprisals.
Senior PSPC officials were testifying to the House of Commons public accounts committee which is trying to shed light on cost overruns ofArriveCAN.
The decision to withdraw a company’s security clearance “is not taken lightly,” said the assistant deputy minister of PSPC’s Procurement Programs Branch, Dominic Laporte. In the case of GC Strategies, it was “the sum of the allegations of non-compliance” and the result of the internal investigation which pushed the Department to take it.
Dalian Enterprises Inc., which received 8 million for ArriveCANthe second largest sum, also lost its security clearance after the government discovered last week that its chairman and founder, David Yeo, was working both as a full-time civil servant and as a consultant.
PHOTO MYLÈNE CRÊTE, THE PRESS
Part of the offices formerly occupied by Dalian Enterprises in downtown Ottawa are for sale.
“This is a very unusual situation,” admitted PSPC Deputy Minister Ariane Reza. She added that she called the RCMP commissioner after learning about it and took action quickly. Over the past year, only five public servants were fired for contravening the Public Sector Values and Ethics Code.
Mr. Yeo was also suspended from his position at National Defense while the ministry investigates the situation. Mme Reza said it is up to civil servants to disclose any conflicts of interest to their superiors.
The Press revealed last week that he had held accounts in tax havens since 2011. His company, Dalian, is the subject of an audit since it is listed as a joint venture with the firm Coradix Technology Consulting in the federal government’s Directory of Aboriginal Businesses. Mr. Yeo is a member of Alderville First Nation, Ontario. Part of the offices formerly occupied by Dalian Enterprises in downtown Ottawa are for sale.
Ottawa has set itself the goal of annually awarding at least 5% of the total value of all government contracts to Indigenous businesses, the equivalent of the proportion of the country’s Indigenous population. This represents approximately 1 billion per year. This program is also the subject of a review by the Ministry of Indigenous Services in the wake of the ArriveCAN scandal.
Coradix’s contracts were recently suspended, but it retains its security clearance for now. This means that it will no longer be able to bid on calls for tenders supervised by PSPC until further notice, but it could continue to obtain smaller contracts, for which departments or agencies do not need the support. approval of this ministry.