Retired engineer explains how he rigged contracts

Gilles Surprenant, a retired engineer at the City of Montreal, testifies before the Charbonneau Commission on this image made off television Thursday, October 18, 2012 in Montreal. THE CANADIAN PRESS/Paul Chiasson

Retired city of Montreal engineer Gilles Surprenant has elaborated, at length, how he accepted bribes and rigged contracts for decades.

Surprenant had already admitted how he took in nearly $600,000 in bribes from construction companies over his career.

On Tuesday he explained how, in contract after contract, firms handed him cash in exchange for his approval of illicit and unnecessary expenditures on sewer and waterworks projects.

"Essentially the Angus Shop development, we did this over many seasons, therefore there were many sewer and aquaduct projects, and subsequent paving and sidewalk projects," each of which was an opportunity for companies, contractors and engineers to fleece taxpayers,  he explained.

From 2000 to 2002 ten companies handed Surprenant more than $200,000 in bribes, and the engineer specified precisely how much he was given each time.

Surprenant said that he never asked for a specific amount in bribery money, but relied on the generosity of crooked contractors -- sometimes prodding them to give him a cash payment.

Surprenant testified he received kickbacks from construction bosses ranging from $3,000 to $10,000. At least twice, he pocketed about $22,000.

By the commission's count and Surprenant's own admission, he walked away with between $50,000 and $60,000 in 2000 alone.

Surprenant has admitted he collected as much as $600,000 in kickbacks over a 20-year period. He returned $122,800 to the inquiry in August and says he gambled away and used up the rest.

He also received numerous tropical holidays, expensive meals and concert and hockey tickets. Surprenant has testified he golfed on two occasions with Vito Rizzuto, the former godfather of the Montreal Mafia.

Surprenant said that the spike in public works projects at the turn of the millennium led to more opportunities for bribery.

Surprenant said that within a few years the price of contracts jumped by 25 per cent, which was blamed on an increase in fuel prices, however Surprenant said that it was common knowledge within city hall that bureacrats and engineers were accepting bribes.

He said on Monday that in 2005, members of the Executive Committee, the mayor's inner cabinet of top politicians, were also on the take, skimming three percent of all contracts.

Surprenant said collusion was rampant and occurred on contracts big and small. After some prodding from commission lawyer Denis Gallant, Surprenant admitted that many people at city hall were in the know.

"From what I hear, perhaps it was an open secret, as you say," Surprenant said.

He said he artificially increased the price of contracts determined by a computer program to meet the requests of construction companies working in a cartel.

He added explanatory notes to the plans to justify the extra costs. Surprenant said no one ever questioned why the computer-generated contract estimates were always being revised upward.

"It was always accepted, at all levels, right up to the executive committee," he said of the inflated contracts, sometimes as high as 35 per cent. Surprenant said his immediate superior, Yves Themens, and Robert Marcil, Themens' boss at the time, were in the loop on the price hikes.

Themens has been named in previous testimony by Lino Zambito as having provide sensitive information to contractors. With the allegations, Themens has been suspended from his job pending an investigation. Marcil no longer works for the city.

Surprenant said that in 2000, the list of bidders was made public, which helped construction companies collude. The amounts were higher and the same companies were winning contracts.

"If the lists weren't made public, this phenomenon probably wouldn't have existed," the engineer said.

While it may have been an "open secret," Surprenant repeated that his bosses always signed off on his work. And no one did anything to stop the rising costs.

"It was spoken about in the office, it was known to everyone but no one from the administration or my bosses ever came to see me."

Surprenant never told anyone about the amounts he was receiving and said he was never completely comfortable with the kickback scheme.

He has denied he was collecting one per cent of the contracts, as had been previously stated by Zambito. But when contractors weren't quick with paying out a cut, he would sometimes call to arrange a meeting.

He said the cuts destined for his pockets were collected in a variety of places, from street corners to restaurants to the headquarters of major construction companies.

Surprenant has testified he began taking kickbacks as of the early 1990s but that the practice really only took off as of 2000. Surprenant said it was common place in contracts dealing with sewers, which was his job, but also prevalent in other areas like sidewalks and roads.

Surprenant said some people were more comfortable living a lavish lifestyle.

Previous witness Zambito has testified that Surprenant's colleague, Luc Leclerc, was also collecting kickbacks.

Surprenant said Leclerc was aware Surprenant was getting kickbacks and has said it was Leclerc who let him know the Mafia and the city's "executive committee," an elected decision-making board, were taking cuts.

Zambito has said the money was destined for the mayor's political party, Union Montreal.

Surprenant testified that Leclerc owned a home on the same block as construction boss Paolo Catania of F. Catania Constructions. The latter had built the home for Leclerc in a trendy housing project south of Montreal. Leclerc's neighbours included Frank Catania, Paolo's father.

It was a beautiful house, Surprenant admitted. But he could never see himself in such a home on his salary of about $82,000 a year. By comparison, Leclerc only made about $15,000 more.

"I didn't want it to change my family's lifestyle or those of my kids," said the divorced father of three.

The inquiry also heard that Themens, Leclerc and Surprenant, who used to vacation frequently together, continued to see each other after the last two men retired.

Union Montreal granted status

Lawyers for Union Montreal have asked for and been granted participant status at the Commission following shocking testimony at the Charbonneau Commission.

This week retired engineer Surprenant said that it was well-known that corruption ran throughout city hall, including into the highest political offices in Montreal, the city's Executive Committee.

That prompted the ruling political party in Montreal, Union Montreal, to ask permission to question Surprenant once his testimony is over.

Justice France Charbonneau ruled that was acceptable with the limitation that lawyer Michel Dorval can only ask questions concerning contracts within the city of Montreal and on party financing.

The accusations of widespread corruption among politicians from Surprenant, aka 'Mr. TPS,' who has already admitted to taking $600,000 in bribes over a 20-year career, sparked an angry, rowdy meeting at city hall on Monday, with opposition councillors saying Mayor Gerald Tremblay has done nothing about corruption during his 11 years in office.

Tremblay refused to step down, and said the opposition was not clean, pointing out that former Vision Montreal leader Benoit Labonte stepped down several years ago following accusations he accepted cash from then-construction company owner and operator Tony Accurso. However prior to joining Vision Montreal, Labonte was a member of Union Montreal, the mayor's political party, and was a key member of the Executive Committee.

 With a report from The Canadian Press