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Updated: Thu, 21 Nov 2013 22:03:15 GMT | By CBC News, cbc.ca

Harper ducks queries about fundraising chief in Duffy affair



Prime Minister Stephan Harper speaks during a news conference in Lac Megantic, Que., Thursday, November 21, 2013, where he announced funding from the federal government to help with the decontamination of the town. Graham Hughes, Canadian Press

Prime Minister Stephan Harper speaks during a news conference in Lac Megantic, Que., Thursday, November 21, 2013, where he announced funding from the federal government to help with the decontamination of the town. Graham Hughes, Canadian Press

Questions are growing about whether Prime Minister Stephen Harper knew about an earlier attempt that might have been worked on by his office to repay Senator Mike Duffy's inappropriate housing claims.  

RCMP documents released to an Ottawa court Wednesday allege that Senator Irving Gerstein, chair of the Conservative Party Fund, offered to pay Duffy's housing claims in the amount of $32,000 in February.

This offer was allegedly made about a month before Nigel Wright, Harper's former chief of staff, personally repaid Duffy's claims with a $90,000 cheque.

Harper did not answer specific questions from reporters Thursday about whether he knew his top party fundraiser had at one point agreed to repay Senator Mike Duffy's expense claims, as the RCMP claim, using party funds collected from donations by supporters.

Harper was speaking at Lac-Mégantic, Que., where he announced money for a cleanup of last summer‛s deadly rail

Asked directly by a reporter about when he knew Gerstein had initially planned to repay Duffy's housing claims, Harper replied, "I said right from the outset that Mike Duffy should repay his own expenses. I was told that was what he agreed to do, and I was told that was what he had done." He did not mention Gerstein.

The RCMP say that on Feb. 22, Wright called Gerstein and asked if the fund would pay $32,000 plus interest to cover Duffy's housing claims. "Gerstein confirmed it," the RCMP says in a sworn affidavit.

Harper has always said he didn't know about his former chief of staff's $90,000 payment to Duffy until May 15 and has insisted he never would have approved it. 

The $32,000 figure comes out of an earlier effort to clean up Duffy's housing claims. At the time, Wright believed the figure was correct.

But, the $32,000 was only for Duffy's housing claims. His per diems — the amount he charged for meals and incidentals while in Ottawa on Senate business — brought the amount he owed to $90,000. Wright found out about the per diems on Feb. 26.

"I am beyond furious," he wrote to his executive assistant, David van Hemmen. "This will all be repaid."

The RCMP say once Gerstein found out the amount would be $90,000, he refused to repay it with party money.

Gerstein told the Conservative Party's Calgary convention in October that he never agreed to any kind of repayment for Duffy. He refused to comment Thursday when reporters asked him about his statement.

The $32,000 figure

Emails from Wright, obtained by the RCMP, indicate that when the amount Duffy owed was thought to be only $32,000, the prime minister may have known the Conservative Party was planning to cover the bill.

Wright was embroiled in making a deal with Duffy's lawyer at the time, Janice Payne. Payne stipulated in an email dated Feb. 21 that if Duffy were to accept help repaying his expenses, which he did not believe he owed, one condition would be "an arrangement to keep him whole on the repayment. His legal fees will also be reimbursed."

The RCMP's lead investigator on the Duffy case, Cpl. Greg Horton, writes about this email, "I believe the term 'keep him whole' means Senator Duffy would not financially be out of pocket."

On Feb. 22, Wright in an email to Benjamin Perrin, the prime minister's lawyer, and others in the PMO said, "I do want to speak to the PM before everything is considered final," referring to the deal with Payne and Duffy.

Horton says an hour later Wright followed up with an email, stating, "We are good to go with the PM once Ben has his confirmation from Payne."

The deal fell through, the RCMP say, because of Gerstein's refusal to repay the sum.

The Conservative Party did pay Duffy's legal fees.

Duffy 'deliberately lying'

The CBC's Catherine Cullen asked Harper Thursday at Lac-Mégantic why Gerstein and Chris Woodcock, a former PMO staffer who now works for a cabinet minister, were still part of Harper's team since RCMP documents say both were aware of the Duffy repayment.

Harper again would not directly answer, but said, after accusing Wright of "inappropriate actions" and Duffy of "deliberately lying to the public," said, "It is Mr. Duffy and Mr. Wright who are under investigation for their actions. That is what is appropriate for this case."

In question period Thursday, Liberal MP Ralph Goodale said such a payment, referring to the $32,000 figure, "would be just as wrong as the payment by Nigel Wright. Why did the prime minister say 'good to go' for a payment from the Conservative Party [to Duffy]?"

Conservative MP Paul Calandra, the prime minister's spokesperson in the House, said, "The prime minister said no such thing."

CBC News later asked the prime minister's director of communications for clarification about whether Harper knew about discussions between Wright and the Conservative Party concerning whether its fund would repay Duffy's expenses.

Jason MacDonald replied in an email, "The answer is no. The prime minister had no knowledge of this. Until May 15 the prime minister was of the understanding that Mr. Duffy had repaid his inappropriate expenses using his own funds."

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