Tom Sweeney

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Bid Rigging Update

Posted by sweens on May 4, 2009


The witness: Convicted bid-rigger takes aim at tech firms
By Elizabeth Howell
, Ottawa Business Journal Staff

The sentence: a $5,000 donation to charity

A vice-president of one of the tech firms charged with bid rigging has been convicted and will serve as a key witness as the matter proceeds through the courts this summer, court documents show.

On Feb. 23, Veritaaq Consulting’s Shannon Lambert signed a statement of facts submitted to the Ontario Court of Justice, admitting she participated in rigging an IT contract for Transport Canada.

For the Transport Canada contract under investigation, Ms. Lambert fingered three firms as the alleged ringleaders of a bid-rig conspiracy: TPG Technology Consulting Ltd., the Devon Group Ltd. and Donna Cona Inc.

Donald Powell, who heads TPG and has an ongoing grievance against the government related to another bid that he claims was changed to favour Montreal’s CGI Group Inc., was the head of the group, the document stated.

TPG has claimed the bid-rigging case was revived due to Mr. Powell’s testimony in the CGI case before the House of Commons in June 2008.

“The bidders’ objective was to win as much of the work resulting from the RFP (request for proposals) at Transport Canada as possible,” read the statement signed by Ms. Lambert.

“The bidders agreed on the content of their bids, including technical and financial information with respect to resources by securing specific, agreed-upon resources that they knew would obtain high scores during the technical evaluation process.

“By submitting the same names and work experience information, the bidders hoped to obtain the best scores possible and secure the rights to provide services.”

But Mr. Powell did not attend about three-quarters of the meetings for the contract under question, argued Serge Buy, a consultant at Flagship Solutions acting as the public spokesperson for TPG.

“This is just bloody ridiculous,” he said.
“My worry is (this case) is doing a good job to destroy Mr. Powell’s credibility. The fact of the matter is all of this will be proven in court, but in the meantime the court of public opinion is there.”

The statement signed by Ms. Lambert noted the meetings were presided over by Thomas Townsend, who was working for Mr. Powell at the time. Mr. Townsend has been charged with bid rigging in regard to the Transport Canada contract.

There are also eight Canada Border Service Agency contracts and one Public Works contract from 2005 being investigated.

“In order to be charged with bid rigging … an individual must be party to the agreement at hand,” wrote Competition Bureau spokesperson Alexa Thorp in an e-mail.

“However, joint ventures are permissible under the Competition Act. Any party to an agreement or arrangement must explicitly notify the tendering authority of the agreement or arrangement to avoid liability under this offence. It is not enough that the tendering authority ought to have known there was an agreement because of past practice or because identical prices were submitted.”

Public Works will maintain business relations with Veritaaq and the other firms charged for the time being, stated spokesperson Nathalie Betote Akwa.

“(Public Works) has undertaken an administrative review to determine if administrative measures are warranted against Veritaaq and other companies and individuals,” she wrote in an e-mail, noting the department is acting with “due diligence and fairness” as it investigates under section 40.1 of the Financial Administration Act.

In exchange for her upcoming testimony, Ms. Lambert received protection in the Competition Bureau’s immunity program for the eight CBSA and single Public Works contracts.

However, another unnamed witness came forward first for the lone Transport Canada contract, disqualifying Ms. Lambert for immunity. For her activities in that contract, she received a suspended sentence requiring she donate $5,000 to charity.

“The reason there’s an immunity program is to detect what are very, very secretive activities,” said Sheridan Scott, a partner at Bennett Jones LLP and commissioner of the Competition Bureau until last year.

“If you’re coming forward, you have to assist in the investigation, you have to be able to provide evidence and provide witnesses.”

Ms. Scott noted she could not comment on the particulars of the case given “it was basically alive the entire time I was there.”

But in general terms, she added, applicants to the immunity program will only receive immunity if they are the first one in, although the bureau is implementing a leniency program that will reduce the sentences for other witnesses who choose to testify.

“You’re letting people off scott-free. People are not going to be prosecuted and they have engaged in criminal activities. You have to have a huge incentive to bring them forward.”

A letter from the deputy minister of Public Works written in April 2007 – seven months after search warrants were issued in relation to the bid-rigging allegations – praised TPG’s work with the federal government, Mr. Buy pointed out, indicating to him the case was all but dead at that point.

“I should note that your firm has served us well in the provision of engineering technical services. It is also a firm in good standing with our department,” stated the letter, signed by then-deputy minister David Marshall.

However, Mr. Marshall further wrote he had concerns with allegations that TPG was making in public concerning the RFP process.

“On the most serious allegation made, let me assure you that neither the minister nor his staff were involved in the selection process – they were not involved in the requirements specification, in determining the evaluation methodology, nor in the evaluation itself.”


THE CONTRACTS
Canada Border Services Agency: 46E29-069331

Firms charged:

  • TPG Technology Consulting Ltd
  • Spearhead Management Canada Ltd.
  • Tipacimowin Technology Inc.

Canada Border Services Agency: 46E29-069503
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.
  • Donna Cona Inc.

Canada Border Services Agency: 46E29-069427
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.
  • Donna Cona Inc.

Canada Border Services Agency: 46E29-06719
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.
  • Donna Cona Inc.

Canada Border Services Agency: 46E29-06718
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.

Canada Border Services Agency: 46E29-06720
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.
  • Donna Cona Inc.

Canada Border Services Agency: 46E29-069505
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.
  • Donna Cona Inc.

Canada Border Services Agency: 46E29-069502
Firms charged:

  • TPG Technology Consulting Ltd.
  • Spearhead Management Canada Ltd.
  • Donna Cona Inc.

Public Works and Government Services Canada

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One Response to “Bid Rigging Update”

  1. Watch Dog said

    No Much Surprised

    Somehow I am not surprised at seeing Veritaaq Consulting’s name in this scandal. There are all kinds of rumors about the questionable practices by the employees of this firm. I am not sure to what extent they are true but Veritaaq Consulting’s name in this bid rigging coviction should be an eye opener for consultants and clients who want to do business with this firm. Its reputation is forever tainted now after the indictment of its key vice-president in the corruption scandal. OPS should also review the decision to keep this tainted firm on its VORs after its malpractices vis-a-vis Federal Government have been discovered.

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