Sheegl pays city court-ordered $1.15M for police headquarters bribe Good news for taxpayers, mayor says By: Joyanne Pursaga Posted: 12:16 PM CST Wednesday, Jan. 7, 2026 Last Modified: 6:08 PM CST Wednesday, Jan. 7, 2026 Updates

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This article was published 07/01/2026 (278 days ago), so information in it may no longer be current.

The City of Winnipeg has received its first round of long-awaited court-ordered payments linked to the Winnipeg Police Service headquarters project and expects millions more to follow.

Chief administrative officer Joseph Dunford noted in an email that the city has received a full $1.15-million payment from former city CAO Phil Sheegl.

The payment includes damages, costs, and interest that total $1,151,726.36.

Mayor Scott Gillingham called the development a win for taxpayers.

“That’s good news for the people in Winnipeg. We fought (for) this in court because we believe the people needed to be paid back … plain and simple,” said Gillingham.

Serious concerns surrounding the police headquarters project at 245 Smith St. have plagued city council for years. The building opened in June 2016 at a cost of about $214 million, well above its original $135-million price tag, and an external audit found the project was severely mismanaged.

“We fought (for) this in court because we believe the people needed to be paid back.”

The RCMP conducted a lengthy investigation into fraud and forgery allegations, but no criminal charges were laid.

Coun. Brian Mayes said he’s pleased to see one chapter of the saga resolved.

“(There’s) certainly some relief that we’re finally moving on and trying to get all this behind us … It’s lingered over us for (many) years,” said Mayes (St. Vital).

A court ruled in 2022 that Sheegl accepted a bribe from Caspian Construction, a key contractor on the project, and ordered the compensation.

Sheegl claimed the payment wasn’t a bribe and that it covered a real estate deal to buy an acre of land he and then-Winnipeg mayor Sam Katz owned in Tartesso, Ariz. He lost an appeal of the ruling in 2023.

Dunford’s email, which was sent to city council members Wednesday morning, notes the payment was made Tuesday.

The city has also received an initial payment from a settlement of fraud and construction-deficiency lawsuits it had launched over the WPS headquarters project, the email notes.

“To date, we have received $500,000 (from that settlement); however, we have not received any settlement amounts related to the secured assets. The city has registered a security on the defendants’ real property to secure full payment, and there is no risk that assets will not be available to secure the city’s position,” Dunford wrote.

The email does not state when that payment was made or offer other details. The city previously noted properties with a combined value of $28 million were guaranteed to the city, should cash payments not be made.

The city did not grant a request to interview Dunford or other city staff Wednesday. In a brief email, spokesman David Driedger confirmed the payments, noting the city has “not received any amounts related to secured assets.”

Gillingham said he’s not aware of when or how the remainder of the settlement will be paid.

The settlement approved in March 2023 called for the city to receive $21.5 million if fully paid within 12 months, $22.5 million if paid within 24 months, or $23.5 million if paid within 36 months.

If the payment is not made within 36 months, the city would ask the Court of King’s Bench to order that it be paid $28 million. That deadline will be reached on March 24, 2026.

The payments relate to two legal challenges.

The city sought damages for alleged construction deficiencies from Caspian and structural engineering consultant Adjeleian Allen Rubeli in 2018, alleging both companies were “negligent” in their work on the headquarters. The city launched a civil suit against Caspian, AAR and dozens of other defendants in 2020, alleging a fraudulent scheme inflated the price of the project.

The allegations have not been proven in court.

A $2-million provincial inquiry into the police HQ project, which converted a former Canada Post warehouse and office tower into the headquarters, is scheduled to begin on Feb. 10 and end on June 18.

The probe is expected to explore the city’s ability to implement large-scale construction projects and determine any measures need to restore public confidence.

Gillingham said he supports the inquiry and hopes it will uncover more information and avoid merely “rehashing” details already known to the public.

“Changes have been made in city practices to do all we can to prevent this kind of thing from happening again.”

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The mayor stressed the city has made several changes to ramp up oversight since allegations first arose around the headquarters’ construction, which included adding a new chief construction officer position to help oversee major projects.

“Changes have been made in city practices to do all we can to prevent this kind of thing from happening again, and we’ll continue to make the improvements that we need. I really hope the inquiry (will) focus on things that we don’t know,” he said.

Caspian Construction officials and Sheegl could not be reached for comment Wednesday.

joyanne.pursaga@freepress.mb.ca

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Joyanne Pursaga
Reporter

Joyanne is city hall reporter for the Winnipeg Free Press. A reporter since 2004, she began covering politics exclusively in 2012, writing on city hall and the Manitoba Legislature for the Winnipeg Sun before joining the Free Press in early 2020. Read more about Joyanne.

Every piece of reporting Joyanne produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press‘s tradition, since 1872, of producing reliable independent journalism. Read more about Free Press’s history and mandate, and learn how our newsroom operates.