The American paper adds that the "inquiry into corruption in the Quebec construction industry, which led to the resignation of Montreal Mayor Gerald Tremblay on Nov. 5, is souring sentiment among investors in private-public partnership bonds linked to projects for hospitals and universities in Canada’s second-largest province."
The McGill University Health Centre (MUHC) P3 project is now under police investigation. The National Post reports that questions are being raised whether "illicit cash payments helped the SNC-Lavalin consortium win the MUHC contract."
Three weeks ago the police raided the downtown headquarters of the MUHC. The National Post notes one unconfirmed report alleged that there was a secret $22.5 million payment that involved the MUHC. The CEO of the MUHC has resigned and left "for parts unknown." The chair of the MUHC board also resigned. And he too isn't talking. The editorialists at the Montreal Gazette adds this of the giant corporation that headed the P3 bid:
"Riahd Ben Aissa, who headed the company’s construction division and was its original point man for the MUHC project, was arrested earlier this year in Switzerland in connection with allegations of corrupt practices unrelated to MUHC work. Also of concern is that the firm hired to excavate the land at the hospital’s Glen Yard site, Louisbourg SBC SEC, was headed by construction magnate Tony Accurso, who currently faces charges of fraud, corruption, bribery and conspiracy. His firms have previously been guilty of tax evasion....Further investigation into the matter by The Gazette’s Aaron Derfel has revealed a number of anomalies in the bidding process. These include rules of secrecy that prevent an open examination of the bids to loopholes that allowed major partners in the consortium to bid on both the McGill as well as the Université de Montréal hospital projects at the same time — against PPP rules in Quebec that said they could only bid on one of the two. Derfel’s reporting has also cast light on a rule of secrecy that prohibits public disclosure of people who sat on selection committees that reviewed bids for the hospital contract. With the exception of Porter and former MUHC board chairman David Angus, whose names were inadvertently made public, it is still not known who exactly participated in the process."
Braive also notes that issuance in the public-private market has “really slowed” because hospital construction in Ontario has slowed as well as the Quebec corruption probe.