Dirty Business in Quebec

Dirty Business in Quebec

Lino Zambito is an unlikely white knight. The career trajectory of the burgeoning CONSTRUCTION magnate came to a screeching halt when in 2010 he was caught on tape attempting to influence an election in the Montreal suburb of Boisbriand. His company went bankrupt soon after. Last year, he pleaded guilty to electoral fraud, and still faces criminal charges in connection with a single-bid $28-million contract to build Boisbriand's water purification plant.

Perhaps he has had a tinge of remorse--or maybe he thinks he has nothing left to lose. Regardless, once compelled by subpoena to appear at Quebec's so-called Charbonneau commission, Zambito, 43, freely and frankly offered up what is arguably the most damning testimony yet about the dirty state of affairs within the province's construction industry. It has battered the already teetering political career of Montreal Mayor Gérald Tremblay and prompted fresh outrage from a population shell-shocked by years of corruption allegations concerning its elected officials. It has also implicated Montreal's former director general Robert Abdallah--a man who once seemed to have a powerful connection within Stephen HARPER's Conservatives.

Zambito's allegations are almost too long to list. His most damning contention, however, is directed at Montreal's long-serving mayor. Whenever Zambito bid on municipal contracts in Montreal, he alleged certain kickbacks were necessary. He said he knew that 2.5 per cent would have to go to the Rizzuto clan, Montreal's notorious MAFIA syndicate that controlled the number of construction companies doing business in the metropolis. Montreal's municipal government was a touch more expensive, Zambito said: "Starting in 2005 and 2006, there was an amount of three per cent of the contracts that I gave to [Rizzuto confidant Nicolo] Milioto that I knew was going to Mayor Tremblay's political party."

What's more, Zambito claimed a further one per cent of those contracts awarded to Infrabec, his company, would be directed to Gilles Surprenant, who until 2009 was a city of Montreal engineer. Apparently a cheeky fellow, Surprenant dubbed the payments TPS, or "taxe pour surprenant"--TPS is the French acronym for the Goods and Services Tax--and would often invite Zambito and his crew to his pizzeria in the off-island suburb of Repentigny "as a way to get people into his restaurant." During his testimony, Zambito was careful to note he always paid for his own pizza.

All this bribe money increased Infrabec's expenses, and he claimed he made up for it by conspiring with city engineers to bill for bogus additional costs--a process he described as "emptying the envelope" with "fake extras." Zambito testified a chunk of the money flowed directly to city engineers like Zambito and fellow retired engineer Luc Leclerc, with the scheme involving city officials at every level.

In his testimony, Zambito estimated he'd given upwards of $200,000 to Surprenant alone over the years. The money apparently wasn't enough for the city engineers; as Zambito put it, Surprenant and Leclerc "self-invited" themselves to a resort in Mexico, in which Zambito's father was a shareholder. (A photo presented as evidence shows the two city workers and Zambito, along with several blurred-out faces, around a table at the resort, toasting the camera with full glasses of red wine.)

Leclerc also stored his Corvette at Infrabec's underground garage. Zambito took to having a Christmas party for all the city employees he dealt with because it was cheaper and more discreet that sending them all gift baskets. Neither Leclerc nor Surprenant have addressed Zambito's testimony, though Leclerc did tell Radio-Canada that he'd been to Mexico with the construction company owner.

"Mr. Zambito, let's call a dog a dog and a cat a cat," said commission lawyer Denis Gallant. "What you were doing ... was a fraud, yes?"

"Yes," Zambito answered.

Mayor Tremblay has so far rebuffed repeated calls to resign. "My conscience is clear," he told reporters during a very short press conference following Zambito's sortie, during which he refused to directly address Zambito's allegations. His political future, though, is certainly muddier--even for a man who has made a career out of dodging the various scandals engulfing his administration. Zambito's claim that Union Montréal, the municipal party that Tremblay has led for over a decade, was a regular beneficiary of Mafia-related payments is just the latest allegation to dog Montreal's long-suffering mayor.

Tremblay came to power in 2001. A devout federalist, the 70-year-old mayor has a reputation as a nebbish, flare-free technocrat. It has served him well. During the 2009 election, when it surfaced that the city's executive committee chairman Frank Zampino had vacationed on the yacht of Tony Accurso, a bona fide construction magnate recently arrested on fraud and tax-evasion charges, Tremblay's team released a radio ad trumpeting his ignorance. "One of your colleagues at work decides to do something a little shady," Tremblay says in the voice-over. "Do you think they're going to tell their boss or you? Face it: they're not going to tell anybody."

That same year, Tremblay withstood the news that Union Montréal fundraiser Bernard Trepanier was helping certain Mob-related construction companies receive city contracts for a fee; last May, Tremblay pleaded ignorance once again when police arrested both Zampino and Trepanier for their involvement in a city real estate scheme. And some think the mayor will weather this storm as well. "Keep in mind that [Zambito] is an individual with a very checkered past," says former city councillor Robert Libman, who served on the executive committee from 2001 to 2004. Libman says he would be "stunned" if Zambito's allegations were true. "If any of this was done, if it was that rampant, it would have to have been camouflaged in a very sophisticated way, because we never got a whiff of it," he says. "I might be completely wrong or naïve, but if those allegations are true I would be shocked."

Robert Abdallah certainly agrees. During his testimony, Zambito said he used piping from a certain company, despite it being more expensive, at the behest of the former high-ranking Montreal official. Abdallah, who left the city's employ in 2006 to work for a company owned by Tony Accurso, has ties to Dimitri Soudas, Prime Minister Stephen Harper's former director of communications. In 2008, the Bloc Québécois revealed Soudas unsuccessfully lobbied to have Abdallah named the president of the Montreal Port Authority in 2007. This week Abdallah was unequivocal in the face of Zambito's testimony. "I never gave such an order" to use a certain company, Abdallah told La Presse.

Zambito himself has a challenging future, to say the least. Apart from the bankruptcy and looming criminal charges against him, he now must face the potential consequences of having exposed what is allegedly one of the Mafia's most lucrative rackets: the systematic plundering of Montreal's public contracts.

Yet if the thick, beefy fellow with mallets for hands and Jay Leno hair is at all worried, it didn't come through in his testimony. "It was actually quite mind-blowing," he said the other day, of working corrupt city officials against each other to ensure the lowest bribe. "It was ... well, it was a sport."

Maclean's October 15, 2012