Kinew faces catch-22 ahead of inquiry into WPS HQ scandal By: Dan Lett Posted: 1:48 PM CDT Wednesday, Oct. 30, 2024 Last Modified: 5:13 PM CDT Wednesday, Oct. 30, 2024 Updates

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Punishment or accountability?

These are the options facing Premier Wab Kinew as he forges ahead with plans for a public inquiry into the scandal-plagued construction of the downtown Winnipeg Police Service headquarters, which ended up $80 million over budget.

This week, Kinew revealed his government has established the terms of reference, a timeline and a budget for the hearings. The search for a commissioner to head up the inquiry is ongoing.

However, with so many details yet to be revealed, it’s impossible to tell if Kinew has considered the full range of consequences of launching a full public inquiry.

Kinew’s original pledge, first reported in the Free Press a few weeks after he won last fall’s general election, was to hold a public inquiry into the WPS headquarters scandal and the subsequent decision by Manitoba Justice not to lay criminal charges based on two extensive RCMP investigations.

In deciding how to best fulfill his original pledge, Kinew is facing a classic catch-22.

To be effective, a public inquiry must be able to compel testimony. There is little point in holding a probe into the WPS headquarters if participants such as former mayor Sam Katz, former chief administrator Phil Sheegl and Caspian Construction owner Armik Babakhanians did not appear and answer tough questions.

However, if the terms of reference make any attempt to reconsider criminal charges, many of the key figures necessary for the inquiry would simply refuse to testify on the basis they cannot be constitutionally compelled to say anything that might incriminate them in a future criminal proceeding.

In other words, witnesses called before public inquiries have de facto immunity from criminal charges for anything they say. That is why most of these hearings don’t even contemplate criminal charges.

This catch-22 is particularly acute in the WPS headquarters scandal because of two principal factors.

First, as mentioned previously, Manitoba Justice did not lay charges.

And second, because many of the details of RCMP criminal investigations were made public during a 2022 civil suit launched by the city against Sheegl.

The city built its civil suit on files obtained by court order from the RCMP. That provided a rare opportunity for the public to view the evidence that Manitoba Justice said was “insufficient” to justify criminal charges.

In short, it’s hard to see how prosecutors decided there wasn’t enough evidence.

The civil trial revealed an intricate web of financial transactions between companies owned by Sheegl, Katz and Babakhanians that Court of King’s Bench Chief Justice Glenn Joyal found was used to pay Sheegl a $327,000 bribe — $100,000 of which was allegedly shared with Katz — in exchange for guaranteeing Caspian would receive the lucrative WPS headquarters contract.

Joyal ordered Sheegl to repay the bribe to the city, return his severance pay and pay penalties that together added up to more than $1 million.

Sheegl’s appeal was unsuccessful, but in its ruling, the Manitoba Court of Appeal raised further issues that undermined prosecutors’ claim there was insufficient evidence to support criminal charges. Justice Chris Mainella determined Sheegl’s conduct was “so serious and so reprehensible” that Justice Joyal could have imposed much higher financial penalties.

The language of these decisions should give Kinew cause for careful consideration about whether an inquiry is what we really need here.

Hearings that abandon all interest in pursuing criminal consequences could certainly make for an interesting spectacle.

Without any fear of self-incrimination, Sheegl, Katz, Babakhanians and others involved in this project would be forced to appear and submit to direct examination by a commission chief counsel. There is every reason to believe that such an inquiry would provide a clear and comprehensive picture of how, as it is alleged, Katz and Sheegl directed the contract to Babakhanians and then financially benefited from undermining the normal civic bidding process.

In addition, an inquiry could lay bare all of the various tricks employed by the contractor and subcontractors to drive up the cost of the project. Largely because Caspian and subcontractors agreed to pay $21 million in an out-of-court settlement with the city, there is still a lot we don’t know about how the project was manipulated to enrich certain parties.

A public probe would also create an opportunity for key figures from the Manitoba Prosecution Service to explain their rationale for not laying criminal charges. Right now, there is a strong possibility that decision could be an entirely separate scandal within the WPS headquarters story.

An inquiry will also remove any likelihood that the principal parties will ever have to face criminal charges.

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Kinew is facing a tough choice no matter which way he goes.

The premier could send the entire RCMP file to an independent prosecutor in another province and get a second opinion on criminal charges. However, if charges were laid, that would indefinitely delay an inquiry. Or, eliminate any need for one.

On the other hand, if Kinew forges ahead with hearings, the allegedly criminal acts may go unpunished.

The premier can pursue punishment or public accountability, but not both.

dan.lett@winnipegfreepress.com

Dan Lett
Columnist

Dan Lett is a columnist for the Free Press, providing opinion and commentary on politics in Winnipeg and beyond. Born and raised in Toronto, Dan joined the Free Press in 1986.  Read more about Dan.

Dan’s columns are built on facts and reactions, but offer his personal views through arguments and analysis. The Free Press’ editing team reviews Dan’s columns before they are posted online or published in print — part of the our tradition, since 1872, of producing reliable independent journalism. Read more about Free Press’s history and mandate, and learn how our newsroom operates.