Ex-spy takes on CSIS review body Says security agency squelched report on threat posed by Chinese triads

Ex-spy takes on CSIS review body Says security agency squelched report on threat posed by Chinese triads

Re-posted Feb 10 2025:

ANDREW MITROVICA
Tuesday, October 24, 2000

Straddling his high-powered motorcycle and clad in leather pants and jacket, Michel Juneau looks more like a pinup boy than a veteran spy.

But for 16 years, the articulate and highly educated French Canadian worked inside the shadowy world of intelligence, first with the RCMP's Security Service and then its successor agency, the Canadian Security Intelligence Service.

"I loved and was devoted to the work," said the bilingual 41-year-old former intelligence officer and policeman.

Now, Mr. Juneau, who left the espionage agency earlier this year to set up his own security firm, has reluctantly emerged from the shadows not to spill secrets but to forcefully fire back at CSIS's watchdog, the Security Intelligence Review Committee, for a contentious report that it issued last week.

"Unfortunately, SIRC's report does a profound disservice to the men and women at the RCMP and CSIS who have dedicated their working lives to the protection of Canada and Canadians," Mr. Juneau said in an interview.

At issue is a sensitive probe of Chinese espionage activity in Canada, code-named Project Sidewinder, that was the product of years of joint analysis by CSIS and the RCMP.

Mr. Juneau, who worked in CSIS's research and analysis branch, co-authored a draft of the Sidewinder report with an RCMP intelligence analyst in May of 1997. It concluded that China posed the single largest threat to Canada's national security.

Ample evidence exists that senior RCMP officers found that the original report went a long way toward proving its overarching thesis and wanted to vigorously pursue its findings. But CSIS unilaterally shelved the report because it believed the study was based on innuendo.

SIRC has acknowledged that a tense schism percolated for years between the RCMP and senior CSIS managers over the fate of the original report. Despite that, in its annual report, SIRC dismissed the original Sidewinder report as "deeply flawed in almost all respects" and "rich with the language of scare-mongering and conspiracy theory."

Mr. Juneau, who was the chief analyst on the original Sidewinder team, which included three other intelligence analysts from CSIS and the RCMP, insisted that it is SIRC's report that is wrong, shrill and "silly."

"My colleagues at CSIS and the RCMP devoted a great deal of time and energy to the report, and I know that our findings, although disturbing and unsettling, were based on concrete evidence," Mr. Juneau said.

"We were not in the business of promoting or conjuring up conspiracy theories and any suggestion that we were is silly, wrong and betrays a profound misunderstanding of how we went about our work."

Rather, Mr. Juneau said, the Sidewinder analysts worked hard to identify an intricate web of connections between Chinese intelligence services and criminal gangs, which they were convinced posed a threat to Canada's national security.

"The original report was thorough and backed up by substantive and tangible evidence," he said. "Their [SIRC's] attack was, regrettably, insulting and deflected attention from the real issue. The report concluded that China posed a multifaceted threat to Canada, and the RCMP analysts agreed."

Indeed, Mr. Juneau said that the original Sidewinder team (it was only the second time the two agencies had collaborated on a major analysis) culled some of its information from a Chinese intelligence officer who defected in 1997.

The man, who was a member of the United Front Work Department, one of China's five espionage arms, went public with allegations that he had been ordered to go to Hong Kong to engineer a pact between Beijing and criminal gangs known as triads.

Mr. Juneau also pointed out that at the RCMP's request, the original Sidewinder team produced a binder, brimming with what is known in the intelligence business as facting. It provided documented evidence, culled from secret CSIS reports, other government departments and agencies and foreign intelligence agencies, that supported every single line in the original report, he said.

Mr. Juneau noted that other Western intelligence organizations and a bipartisan U.S. congressional committee have since produced reports that echoed many of Sidewinder's conclusions. "We were ahead of our time and that's what probably killed our report."

He also flatly rejected a suggestion in the SIRC report that his departure from the Sidewinder team was voluntary and simply the result of a internal reorganization.

"The implication is that I left the Sidewinder team willingly and voluntarily; that is simply untrue," Mr. Juneau said. "I wanted to see the project through to its end."

To his chagrin, CSIS brought in another intelligence officer to complete the report, renamed Project Echo. CSIS told its watchdog that the RCMP agreed with the report's tone-downed findings. But the RCMP informed SIRC that it was "not fully satisfied with the final report" because unlike the first draft it "fails to raise key strategic questions."

A SIRC spokesman refused to respond to Mr. Juneau's allegations.
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http://www.report.ca/missed/p15i001106f.html

Report
6Nov00

(12) The Sidewinder scandal

A leaked report makes explosive allegations about links between the Liberals and Chinese agents

by Kevin Michael Grace

RCMP Commissioner Giuliano Zaccardelli gave an extraordinary press conference on September 7. He told startled reporters, "There are criminal organizations that target the destabilization of our parliamentary system." The commissioner refused to give details but insisted he was not "fear-mongering." He concluded, "We don't want to wait until we become, unfortunately, like some countries around the world, where criminal organizations actually run part of the country."

On October 20 the Security Intelligence Review Committee (SIRC), the government agency that oversees the Canadian Security Intelligence Service, issued its annual report. It devotes six pages to a joint RCMP-CSIS operation, Sidewinder, whose secret interim report, "Chinese Intelligence Services and Triads Financial Links in Canada," was issued in 1997. This report was suppressed, and all copies were ordered destroyed, as were all background materials.

Project Sidewinder was abandoned but then restarted in 1998. A secret final report, "Echo," was issued in 1999. Sources close to Sidewinder have alleged that its 1997 report was first killed and then gutted because it revealed Chinese infiltration as a grave threat to Canadian security and sovereignty.

The SIRC report rejects these allegations. It finds "no evidence of political interference" and claims Sidewinder "was not terminated; it was delayed when its initial product proved to be inadequate." The 1997 report is judged "deeply flawed...a loose, disordered compendium of 'facts' connected by insinuations and unfounded assertions. Overall, the document is rich with the language of scare-mongering and conspiracy theory." SIRC concludes that the destruction of "'transitory' documents related to Sidewinder's first draft" was "standard practice." The disappearance of other "non-transitory" documents is described as "disconcerting" but of no "material impact."

The timing of the SIRC report two days before an election call and its pre-release leak to the National Post are suspicious. SIRC said in September that the report would not be released until the end of the year. Even more suspect is the September 25 assertion in the House of Commons by MP Lynn Myers, parliamentary secretary to Solicitor-General Lawrence MacAulay: "I would like to emphasize that I was not reading from or directly quoting the SIRC report, which is a classified report." He was referring to his September 20 statement to Canadian Alliance MP Jim Abbott dismissing the 1997 Sidewinder report as "deeply flawed" and a "conspiracy theory"--phrases identical to those used in the then-supposedly unwritten, unread, classified SIRC report.

Unfortunately for the Liberals, however, all copies of Sidewinder were not destroyed. The Canadian Alliance and various media, including this magazine, now possess them. The report, 30 pages long and badly translated from the original French, makes a shocking allegation--Hong Kong tycoons, triads (gangs) and Chinese intelligence services "have been working for 15 years in concert with the Chinese government, and some of their 'financial ventures' in Canada serve to conceal criminal or intelligence activities."

These activities include money laundering, heroin trafficking and the transfer of economic, high technology and intelligence data to Beijing. Sidewinder alleges the corruption of the Canadian business and political establishments: "The triads, the tycoons and [Chinese intelligence] have learned that [the] quick way to gain influence is to provide finance to the main political parties...China has obtained access to influential figures who are now or once were active at various levels of Canadian society."

Foremost among the Chinese tycoons, according to Sidewinder, is Li Ka-Shing, of whom U.S. Congressman Dana Rohrabacher has testified, "The U.S. Bureau of Export Affairs, the U.S. Embassy in Beijing and the Rand Corporation...have identified Li Ka-Shing and [his company]Hutchison Whampoa as financing or serving as a conduit for Communist China's military for them to acquire sensitive technologies and other equipment." Last year Forbes estimated Mr. Li's family as the eighth richest in the world, with assets totalling US$10.6 billion.

According to Sidewinder, Mr. Li is a director of the Beijing-controlled China International Trust Investment Company (CITIC), which had 1997 assets of US$23 billion. CITIC owns or controls Cathay Pacific Airlines, Hong Kong Telecom, Star TV, Poly Technologies and Norinco, suspected of arms shipments to Mohawk reserves. Mr. Li's company Hutchison owns 49% of Husky Energy. CITIC has invested $500 million to buy Canadian companies Celgar Pulp Mill and Nova Corp Petrochemical. Mr. Li and his son own "at least one-sixth to one-third of downtown Vancouver" and have extensive real estate holdings in Toronto. CITIC has "developed...close business links with Power Corporation." (Andre Desmarais, Prime Minister Chretien's son-in-law, is president and co-chief executive officer of Power Corporation.)

Mr. Li is the largest (10%) single shareholder of CIBC, and a shareholder and director of the Hong Kong and Shanghai Bank, which in the 1980s acquired the Hong Kong and Shanghai Bank of Canada, Continental Bank and Lloyds Bank Canada. CIBC, in turn, bought the securities firms Wood Gundy and Merrill Lynch. Li Ka-Shing's son Richard bought 50.1% of Gordon Capital in 1985. (Jean Chretien was a senior adviser there from 1986 to 1990.)

None of the above proves that Canada has been subverted by the People's Republic of China, but the linkages and connections revealed between Mr. Li and Mr. Chretien and his family (which are not detailed in Sidewinder but were reported elsewhere) are, as SIRC might say, disconcerting.

But then, SIRC itself is not entirely in the clear. One SIRC member, James Andrews Grant, has a serious unreported conflict of interest. His biography on the SIRC Web site identifies him as a director of CIBC and chairman of the executive committee of the law firm Stikeman, Elliott, which has a long-standing relationship with CIBC's largest shareholder, Li Ka-Shing.

Canadian Alliance MP Jim Abbott, who raised the Sidewinder issue in the Commons, reports that he was immediately denounced by a Liberal MP as a "racist." He adds, "Unfortunately, many Canadians are prepared to buy into these labels, and for that reason they find so much of this  [Sidewinder] unbelievable."

Mr. Abbott takes pains to stress that while he understands "there is a very malicious, a very serious criminal side to triad organizations, there's also the other side within the Chinese culture, where they are part of exchanging power and influence. This is something that we, from our Caucasian, Judeo-Christian basis, just don't comprehend."

Elections Canada loopholes make it easy for gangsters and foreign agents to contribute to Canadian politicians, money which is sometimes received unwittingly. While Mr. Abbott admits his party has "not taken any formal steps" to prevent such occurrences, he explains, "We're very deeply concerned about it and are doing our level best with what information we have to make sure we aren't compromised."
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29May'00

 Chinese triads sought foothold in Vancouver port operations

 
Fabian Dawson, Staff Reporter The Province

The Vancouver Port Authority ignored warnings about the Chinese business interests it was wooing in the 1990s -- allowing a number of questionable business connections to take root in the port, The Province has learned. In the mid-'90s, as courting efforts aimed at Chinese shipping giant Cosco went into overdrive, intelligence officials -- including local ports police -- sounded alarm bells about the conglomerate's questionable connections. The shipping line is intimately linked to the China International Trust and Investment Corp., a key fundraiser for the Chinese government and a technology-acquiring source for China's military.

U.S. Senate investigators and Canadian intelligence officials have described Cosco as the merchant marine of the Chinese military.

Its vessels have been caught carrying thousands of weapons into California and Chinese missile-technology and biological-warfare components into North Korea, Pakistan, Iraq and Iran, according to U.S. intelligence reports. Last summer -- two years after the ports police were disbanded -- the port signed a deal with Cosco to make Vancouver its gateway to North America. Cosco had chosen the only major port on the West Coast of North America without a dedicated police force.

Port officials maintain they have no evidence Cosco is directly involved in any illegal activity and cannot recall receiving police warnings. Cosco officials have declined interviews.

Police and immigration documents obtained by The Province show that, in the early '90s, Chinese mafia members or triads were attempting to infiltrate port operations.

In one case, a man identified as Chan Chung Hiu applied for a visitor visa at the Canadian consulate in Hong Kong to come to Vancouver on Jan. 14, 1992. Chan said he was an advisor to a company that had concluded a deal with the B.C. government to take over operations at one of the docks.

Background checks conducted found that Chan was a member of the notorious Sun Yee On triad and had served a four-year jail term for armed robbery in Hong Kong.

Chan abandoned the application after being asked to produce a police certificate. In another case, members of the same triad group, who are among the world's biggest heroin traffickers, were seen entertaining a senior officer of the now defunct Co-Ordinated Law Enforcement Unit. The party aboard a yacht was hosted by a Vancouver-based shipping company suspected of having links with the Chinese mafia.

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The Jesuit controlled and powerful DESMARAIS Family of Quebec, Canada

December 4, 2011 04:21 
THEUNHIVEDMIND 

Buffett Loses to Desmarais as Power Exceeds Return (Update1)
By Lisa Kassenaar – July 30, 2009 
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aEl4wizkuSTQ

The Desmarais family
July 30 (Bloomberg) — Deep among the pine forests of rural Quebec lies a private estate the size of Manhattan, a refuge where French President Nicolas Sarkozy has gone to relax.
Former U.S. Presidents George H.W. Bush and Bill Clinton have played golf here, on 18 meticulously groomed holes with a bright-yellow cottage for respite at the 13th tee. Pheasant shoots are orchestrated from the hunting lodge; opera is performed in the music pavilion. An original of Auguste Rodin’s The Thinker and a statue of Thomas Jefferson adorn the rough, granite hills.

At the heart of the property is a grand residence surrounded by formal gardens called Cherlieu — which means beloved place — that’s modeled on a 16th-century Palladian villa. This is the home of Paul Desmarais Sr., a white-haired, Canadian billionaire whose obscurity outside Quebec masks his family’s vast connections and influence in global business and politics.

“They keep a very low profile,” says Brian Mulroney, who met Desmarais in 1965 and, as Canada’s prime minister from 1984 to 1993, introduced him to President Ronald Reagan and Bush. “That’s the way they like it.”

Desmarais, 82, started out with a backwoods Ontario bus line in 1951. Now, he and his family control Power Corporation of Canada, a holding company headquartered in an unmarked, eight-story building on Montreal’s leafy Victoria Square. Paul Sr.’s sons, Paul Jr., 54, and Andre, 52, are co-chief executive officers. Together, the brothers govern a labyrinthine business empire that extends from Denver to Geneva to Hong Kong, with seats on 38 related corporate boards.

Bought Putnam
Power Corp. owns 66 percent of Power Financial Corp., a web of North American insurance and asset management companies with 2008 revenue of C$36.5 billion ($32.7 billion). In 2007, the Desmarais bought Putnam Investments, a once mighty, Boston-based mutual fund company that had been wounded by a trading scandal and weak fund performance.

The $3.9 billion deal closed two months before the Standard & Poor’s 500 Index peaked in October 2007. Power Financial’s biggest challenge is to make good on plans to renovate Putnam into a flagship for U.S. expansion, after the mutual fund manager’s assets were almost halved by the 2008 plunge in global markets.

In Europe, the Desmarais have been partners with Albert Frere, one of Belgium’s richest men, for almost two decades. Together, they hold stakes in Total SA, Europe’s third-biggest oil and gas company, based in Courbevoie, France; Paris-based Lafarge SA, the world’s biggest cement maker; and Paris-based GDF Suez SA, the world’s second-biggest utility. Paul Desmarais Jr. is a director of all three.

China Connection
In China, the Desmarais own 4.3 percent of Hong Kong-based Citic Pacific Ltd., a steel, mining and real estate development company with a market value of $7.2 billion as of July 13. Andre Desmarais joined the board in 1997. His father first ventured into China in the 1970s.

“Power Corporation is like an iceberg — large and largely invisible,” says David Beatty, a professor of strategic management at the University of Toronto. Beatty says he begins one of his lectures by asking master’s degree students about the careers of Jack Welch, the former CEO of General Electric Co., and Warren Buffett, CEO of Berkshire Hathaway Inc. Then he flashes a photo of the elder Desmarais.

“None of them knows who it is,” Beatty says. “And I say, ‘It’s Paul Desmarais, and he’s done better than the other guys.’”

Better than Buffett
Those who bet on Power Corp. in the 15 years from 1993 to 2008 earned slightly more than investors in Omaha, Nebraska- based Berkshire Hathaway, according to data compiled by Bloomberg. Power Corp.’s average annual return in the period, including reinvested dividends, was 14.5 percent. Berkshire, which pays no dividend, returned an average of 14.1 percent. The comparison is in local currencies.

The Desmarais also run a $1.6 billion, Paris-based private equity firm called Sagard Private Equity Partners. Investors include companies managed by the Frere family; Bernard Arnault, CEO of luxury goods giant LVMH Moet Hennessy Louis Vuitton SA; and Laurent Dassault of the French aviation family, who’s on Power Corp.’s board.

The unit is named for Sagard, Quebec, a French Canadian hamlet of 260 people that’s about 300 miles (480 kilometers) from Montreal and adjacent to Desmarais’s 15,000-acre (6,070- hectare) estate. Four years ago, Paul Sr. built the villagers a yellow, wooden Roman Catholic church. In December, he attended Christmas services there with the maids, cooks and gardeners who work on his property.

Cirque du Soleil
Some visitors to the estate arrive by helicopter. They come for quiet weekends or for enormous costume parties. Cirque du Soleil, the internationally acclaimed circus troupe started by Guy Laliberte, a former Quebec City busker, has performed there. Guests have included King Juan Carlos of Spain and assorted National Hockey League stars.

“They rank with the best and most generous hosts in the world,” says Mulroney, 70, in an interview the morning after a four-day visit to Sagard. “The only thing they don’t do is tuck you in at night.”

Paul Sr. also owns a home in Palm Beach, Florida, and another in New York. He was Canada’s eighth-richest man in 2008, worth C$4.1 billion, according to “Canadian Business” magazine. That was a slide from fourth in 2007 — partly reflecting a plunge of 44 percent in the shares of Power Corp. as the global economy shuddered. Profit fell 41 percent to C$868 million in 2008, the lowest amount since 2002.

2008 Drop
At Power Financial, where shares declined 44 percent last year, net income dropped 35 percent to C$1.34 billion, hurt by lower fee income from its prime holding, Winnipeg, Manitoba- based insurance firm Great-West Lifeco Inc., and C$983 million in writedowns and other costs related to Putnam.

Power Corp. and Power Financial’s stocks, which trade in Toronto, have rebounded in 2009. Power Corp. stock traded at C$29.53 at the market close yesterday, up 26.4 percent for the year. Power Financial was at C$29.98, up 21 percent.

The family’s mystique is fed by its policy of avoiding the press. “No one really knows the full extent of their power,” says John Aiken, an analyst at Dundee Securities Corp. in Toronto who covers Canadian banks and insurers. “They are an enigma, and I think they like perpetuating that.” The father and sons all declined to comment for this story.

The parent company has no marketing or communications departments, and senior managers don’t foster relationships with institutional investors, Aiken says. “They say, ‘We stand by our results, and if you like us, great; if not, don’t buy,’” Aiken says. “You are at the whim of the Desmarais family.”

‘Magic Sauce’
The University of Toronto’s Beatty, a co-founder of the Canadian Coalition for Good Governance, says investors in family-controlled companies like Power Corp. gamble that the biggest stake-holders will guard their mutual interests.
“Part of their magic sauce is that the Desmarais are the ones there every day,” he says. “The CEO is not the imperial power; it’s the dominant shareholder who is.”

Like Berkshire Hathaway, Power Corp. relies on the insurance business for steady returns. Power Financial’s core companies have been built up with numerous small acquisitions. Last year, for instance, Great-West bought Edinburgh-based Standard Life Plc’s British payout annuity business for an undisclosed sum. It was the third such U.K. purchase in four years, says Jeffrey Orr, CEO of Power Financial.

The Desmarais keep cash high and borrowing low. Power Corp. had C$5.3 billion in cash on its balance sheet at the end of 2008 and just C$6.4 billion in long-term debt, according to Bloomberg data.
‘Floored’

Craig Elsinger, who manages about 450,000 Power Financial shares at Creekdale Investments Inc. in Reno, Nevada, says he was “floored” when the company’s dividend rose twice in 2008, even as markets foundered. Elsinger bought his first shares in 1987. “I look at it like I’m lucky to be sharing at their banquet table,” he says.

Power Corp.’s dividend payout in 2008 was C$1.11 a share, up from 91 cents in 2007. That put the Desmarais’ dividend check at more than C$130 million. Paul Sr., directly and through holding companies, controls 48.6 million participating preferred shares of Power Corp., which carry 10 votes each. He also holds 72 million common shares, according to the company.

He doesn’t collect dividends from Power Corp.’s other publicly traded units: Power Financial; Great-West; IGM Financial Inc., Canada’s biggest mutual fund company; and Geneva-based Pargesa Holding SA, home of Power’s European investments.
Talleyrand

Power Financial CEO Orr sits for an interview in a third- floor boardroom of Power Corp.’s Montreal head office. The walls are lined with paintings by Jean-Paul Riopelle, a Quebec-born abstract expressionist. Elsewhere in the building is a collection of 18th-century neoclassical French antiques and a filing cabinet said to have been used by Talleyrand, Napoleon’s foreign minister.

While earnings declined in 2008, Power Financials' C$36.5 billion in revenue represented a jump of 27 percent, as receipts from Europe doubled, the company reported. “Our fundamental strategy hasn’t changed,” Orr says. He aims to grab market share in life insurance, retirement products and asset management as millions of households in North America and Europe, hurt by falling home and equity prices, set more money aside. “They are going to need to save,” he says.

Long-Term Analysis
Orr, 50, quit his post as CEO of Bank of Montreal’s investment bank in 2001 to sign up with the Desmarais, whom he’d observed for 20 years.

“People said I was crazy to leave the job I had, but I joined this group because of the way decisions were made,” Orr says. Before making an acquisition, the Desmarais examine how an industry will evolve over 10 or 15 years, he says. The family recruits executives who know their business, pays them in part with stock options with 10-year terms and then backs off until board meetings, he says.

The brothers, who took over as co-CEOs in 1996, go into deep detail at dozens of board meetings a year, Orr says. “They’re very active shareholders with active oversight, but they aren’t running the businesses themselves,” he says. “It’s a very fine line.” Paul Jr. is Power Corp.’s chairman; Andre is deputy chairman and president. The father’s only official title is chairman of Power Corp.’s executive committee.

Sprawling Tale
Paul Sr.’s saga is as sprawling as the family’s holdings. Desmarais was an original when he started out in the early 1950s: a French-speaking entrepreneur when almost all of Canada’s bankers, politicians and CEOs belonged to the entrenched, English-speaking establishment, says David Lank, professor emeritus of the Dobson Centre for Entrepreneurial Studies at McGill University in Montreal. His bravura as a dealmaker and his rush of acquisitions over 20 years shifted perceptions of Francophone business leaders.

“Paul Desmarais helped build the stage so that other people could tap-dance,” Lank says.
Desmarais grew to command the intersection of Canadian business and politics through close relations with four prime ministers. He was a backroom adviser, Lank says, to Pierre Elliott Trudeau, who was elected in 1968 and led Canada for 14 years. Mulroney worked as a labor lawyer for Desmarais before he headed to Ottawa. Paul Martin, Canada’s prime minister from 2003 to 2006, ran Power Corp.’s Great Lakes shipping operation before buying it from Desmarais in 1981.
Jean Chretien, prime minister from 1993 to 2003, is part of the family: Chretien’s daughter, France, is married to Andre.
Mulroney and Trudeau both did stints on Power Corp. advisory boards after they left office.

Force in Quebec
Paul Sr. is also a force in provincial politics, working to keep Quebec part of Canada as separatists push to create their own country. Power Corp. owns seven French-language daily newspapers in Quebec and Ontario, including Montreal’s biggest French-language daily, La Presse, which often backs a unified Canada.

Desmarais’s political connections have long spurred speculation he’s swayed government policy in his companies’ favor, Martin, 70, says. The former prime minister, who was also Canada’s finance minister from 1993 to 2002, says he was only ever pressured on one topic. “At no point did they try to influence me on any political issue except on national unity, where we were in complete agreement from the very start,” he says.

Loan from Undertaker
Paul Guy Desmarais was born on Jan. 4, 1927, in a French- speaking enclave of Sudbury, Ontario, a mining town 250 miles north of Toronto. He was 24 years old and a bored law student when he begged his parents to let him revive a small bus company once owned by his late grandfather, according to a Desmarais interview in “The Canadian Establishment,” a 1975 business history by journalist Peter C. Newman.
The buses carried workers to International Nickel Co. of Canada’s nearby Copper Cliff mine. The enterprise was bankrupt, with about C$350,000 in debt.
Desmarais scrambled to keep the buses running, cajoling a local monsignor and an undertaker for $3,000 loans to meet his weekly payroll. Desmarais sometimes drove the buses himself, and his wife, Jacqueline, counted the daily receipts on the kitchen table. Using his one bargaining chip — the fact that International Nickel needed its workers at the mine every morning — Desmarais finally negotiated a loan from the company to help pay creditors and back taxes.

‘Transaction Junkie’
He then began buying more bus lines in Ontario and Quebec, financing the deals with bank loans. In 1960, the family moved to Montreal, where Desmarais expanded into insurance, investment management and newspapers. He bought La Presse in 1967. “He was a transaction junkie at that time,” says John Reucassel, an analyst at BMO Capital Markets, Bank of Montreal’s investment bank, who covers Power Corp.
Desmarais was running a conglomerate called Trans-Canada Corporation Fund, or TCCF, when, in 1968, he acquired control of Power Corp. of Canada in a reverse takeover. That’s a maneuver in which a smaller company sells itself to a larger one and uses the money to buy the larger company’s stock. In this case, Power Corp. exchanged shares with TCCF, and Desmarais received preferred shares of Power Corp., which carried 10 votes each. He became chairman and CEO.

Power Corp. started in 1925 as an aggregator of small electric power companies and then spread into oil, pulp and paper and finance. The company owned a piece of Canada Steamship Lines, which built and operated Great Lakes and St. Lawrence Seaway freighters transporting grain, steel and other commodities. It was through Canada Steamship that Desmarais acquired his huge tract in eastern Quebec.
Separatist Manifesto

Desmarais’s rising prominence and support for a unified Canada made him a target of violent Quebec separatists. In 1969, the Front de Liberation du Quebec, a nationalist group, bombed the Montreal Stock Exchange. A year later, the FLQ kidnapped and murdered Quebec’s labor minister and named Desmarais as a target in a manifesto. He was then provided with round-the-clock security.

Through the 1970s, Power Corp. moved deeper into financial services. In 1970, Desmarais acquired Great-West. “Paul was attracted by the simplicity, or the cleanliness, of the balance sheet of an insurance company,” Mulroney says. “It provided good, solid cash flow.” Mulroney says Desmarais was an avid reader of financial statements. “You could mention almost any company of any note in North America, and he’d know about it because he’d read the balance sheet,” he says.

Early in China
Desmarais also traveled to China, convinced that opportunity lay in that country’s shifting relations with the West. In 1978 — the year that China’s paramount leader, Deng Xiaoping, began opening the country to investment — Desmarais helped found the Canada China Business Council to promote bilateral trade and investment.
The group’s offices in Beijing are in the same building as Citic Group, the Chinese government’s investment arm. Citic’s first investment outside China was a pulp mill in Castlegar, British Columbia, a joint venture with Power Corp., according to a Power Corp. history.
“One of Paul Desmarais’s great talents was his insight into where the great developments were going to take place in the world,” Martin says. He also acted out of necessity. Desmarais’s home market, now 33 million people, was too cramped for a man of his ambition. “Canadians can’t build world-class businesses without looking outward,” Martin says.

Frere Connection
In 1981, Desmarais looked to Europe, where he had earlier put C$20 million into Pargesa, a holding company with a major stake in Banque de Paris et des Pays-Bas (Suisse), a subsidiary of the French bank known as Paribas. When France nationalized Paribas, Desmarais used his proceeds to buy more of Pargesa. Frere, who was also a Paribas investor, did the same.

“I was struck by his integrity and reliability and his strategic sense of the business deal,” says Frere, 83, in an e- mail responding to questions about his relationship with Desmarais, which was formalized in a contract in 1990. “His extraordinary understanding of people and his affable charm were helpful to him in developing valuable relationships in Europe.”

The Desmarais-Frere partnership is a complex corporate matrix: Desmarais, through Power Financial, and Frere, through Groupe Frere-Bourgeois, each own 50 percent of a holding company called Parjointco NV, based in the Netherlands. Parjointco owns 54 percent of Geneva-based Pargesa, which owns 50 percent of Brussels-based Group Bruxelles Lambert SA.
GBL, which is publicly traded in Belgium, holds the group’s stock in Lafarge, Suez, Total and Pernod Ricard SA, a French spirits maker with brands such as Absolut vodka. Pargesa and GBL together hold a majority of Imerys SA, a Paris-based mineral processor.

Next Generation
Frere meets monthly with Paul Jr. to talk about Pargesa’s strategy, he says. “It is a matter of some pride to me, and I believe it is to Paul Sr. as well, to see that our business relationship and our friendship has extended into the next generation,” he wrote in the e-mail.

As Paul Sr. expanded abroad in the 1980s, he changed tacks. For decades, he’d financed rapid-fire transactions with bank loans and by selling stakes in his companies to each other to raise money. When inflation spiked and Canadian interest rates jumped to almost 20 percent, he swore off leverage.

In 1984, he created Power Financial and took it public. That IPO and subsequent share sales raised enough money to eliminate all of Power Corp.’s long-term debt by 1986, the company says.

Conrad Black
Power Corp. then sold off some assets. In 1989, Chicago- based Stone Container Corp. bought Consolidated-Bathurst Inc., a pulp and paper operation in which Power owned a stake, for $2.7 billion. Power’s portion of the proceeds was about $1 billion. The sale burnished Desmarais’s reputation for good timing: The newsprint industry later collapsed.

In 1996, Power sold its 22 percent stake in newspaper publisher Southam Inc. to Conrad Black’s Hollinger Inc. for C$294 million, reaping a pre-tax gain of C$75.2 million. Black is now in prison for looting company assets. The U.S. Supreme Court is reviewing his conviction.

The stock of CanWest Global Communications Corp., which bought the papers from Hollinger in 2000, plunged 99 percent in the two years ended on July 13.
“When they were looking at the world in the late ‘80s and ‘90s, they came to a few conclusions: They thought they had scale in mutual funds and insurance, and they sold forest products and got out of other ancillary businesses,’’ analyst Reucassel says. ‘‘That was the right decision.’’

Canadian Consolidation
In the past decade, Canadian banks, insurers and asset managers have sought scale to compete globally. Power Corp. played a big part. Largely paying cash, Power Financial bought London, Ontario-based London Life Insurance Co. for C$2.7 billion in 1998; Toronto-based asset manager Mackenzie Financial Corp. for C$3.9 billion in 2001; and Toronto-based Canada Life Financial Corp. for C$7.3 billion in 2003.

Power Corp. execs stumbled when they bought Putnam, Dundee Securities’ Aiken says. ‘‘The perception of their Midas touch in terms of acquisitions was definitely tarnished,’’ he says. Once the fourth-largest U.S. mutual fund manager, Putnam was already beleaguered; in 2003, regulators had accused some Putnam money managers of rapidly trading in and out of the mutual funds they managed for their own benefit.
In the three years through early 2007, assets under management tumbled by roughly half to about $200 billion. As of June 30, they were $103 billion. ‘‘Am I happy that the S&P went down 50 percent after we acquired it?’’ Power Financial CEO Orr says. ‘‘No. Of course, that creates a much more challenging environment.’’

Putnam Plans
The Desmarais have big plans for Putnam. In July 2008, they hired Robert Reynolds to captain a turnaround. Reynolds, 57, was previously chief operating officer of Boston-based Fidelity Investments, the world’s biggest mutual fund manager by assets. Reynolds says he was intrigued by the chance to revive Fidelity’s crosstown rival. First, he had to learn something about the new owners.

‘‘The question I had when they approached me was, ‘Who are the Desmarais and what is Power?’” Reynolds says. “I needed to learn more about them.”

Under Reynolds, Putnam has begun selling retail funds that target an absolute return — a certain percentage over Treasury yields — a product already sold to institutional investors. Reynolds has also linked fund managers’ pay more directly to their investment performance. Those with the best returns will get bonuses amounting to 5 to 10 times their annual salary; weak managers will get no bonuses, he says.

‘Challenges Fixable’
“Putnam’s challenges are fixable by having the right people,” Reynolds says over breakfast in Putnam’s glassy headquarters on Boston’s Post Office Square. “They are going to participate in the resurrection of a great investment firm.”

Reynolds is working with Great-West’s Denver-based U.S. operation, which includes the fourth-biggest record-keeping business for U.S. retirement plans. Great-West also sells life insurance and annuities in the U.S. and manages employer- sponsored defined-contribution retirement savings plans. Total U.S. revenue was about C$4 billion in 2008, according to Bloomberg data.

“The Desmarais have always coveted a large U.S. mutual fund company,” Reucassel says. “They like the wealth management business and they like to do business in the U.S.”
‘The Boys’

Paul Sr. began grooming his sons for the business when they were teenagers, and many Canadian bankers and executives still refer to them as “the boys.” Yet Paul Jr. and Andre have become fixtures in international economic and political affairs. Andre is a member of the Trilateral Commission, which was founded by David Rockefeller in 1973 as a forum on global economic and security issues.

Another member is former Federal Reserve Chairman Paul Volcker, who served on Power Corp.’s international advisory board from 1988 to 1997.
Andre is also on JPMorgan Chase & Co.’s international council with former British Prime Minister Tony Blair and Ratan Tata, chairman of Mumbai-based Tata Group. The brothers have at-tended the annual Bilderberg con-ference, according to people familiar with the matter. Bilderberg is an invitation-only gathering of business and world leaders that’s held in a different location every year.

The Desmarais also help host a hometown confab every June, the Conference de Montreal, which was attended this year by more than 3,000 people who listened to speakers such as World Bank President Robert Zoellick and GE CEO and Chairman Jeff Immelt. Paul Jr. is the conference’s chairman.
Elysee Palace

A third generation is in training. Paul Desmarais III, 27, is a banker in the special situations group at Goldman Sachs Group Inc. in New York. His brother Nicolas, 23, has worked at consulting firm Bain & Co. in San Francisco. Both are members of Young Canadians in Finance, which sponsored discussions at the Montreal conference.

While his sons and grandsons network with the intellectual and business elite, Paul Sr.’s power stretches to the Elysee Palace. Desmarais met Sarkozy through Frere in 1995, according to a June 2008 interview with Paul Sr. in Le Point, a French weekly magazine. They became friends at a time when Sarkozy’s public career was on the rocks after a falling-out with French President Jacques Chirac. While they walked in the woods of the Sagard estate, Desmarais recounted, he encouraged Sarkozy to stay in the game.
Master Builder

After Sarkozy was elected president in May 2007, he awarded Desmarais the Grand Croix de la Legion d’Honneur, an order of merit established by Napoleon in 1802. “If I am the president of France today, it is thanks in part to the advice, the friendship and the loyalty of Paul Desmarais,” Sarkozy remarked.

Paul Sr., in his ninth decade, now spends most of his time on his estate. He helped design the Sagard mansion, which was finished in 2003. The library is filled with architecture books, says Tom McBroom, the Toronto golf course designer who spent six years working with Desmarais on the meandering loop of fairways and greens strung out through the woods.

“I would stay over, and he would be up late at night in his housecoat going over the plans for the house,” McBroom says. Sometimes in the evenings, he says, Paul Sr. and Jacqueline would sit and talk about the old days–when they had no high-powered friends and Paul, to save money, would drive one of his buses.

Yet the dynasty was already in the making. Sitting in the back as the bus bumped along were Paul Jr. and Andre, who would grow up to inherit their parents’ business empire.

 

Paul Desmarais’ Web of Influence Over Canada

BY LIFESITENEWS.COM

• Fri May 02, 2003 11:15 EST
• 
  

• 
  
• 
  

 – For many years, astute political observers have noted what appears to be an unusually powerful web of influence over Canadian federal politics by wealthy Canadian businessman and Power Corporation founder, Paul Desmarais senior. The number of Prime Ministers and other elected and influential Canadians financially beholden to the Quebec based Canadian nationalist is astonishing.

In an Ottawa Citizen article of May 2, 1995 columnist Paul Gessell asked “Why does Desmarais have a direct pipeline into every Prime Minister’s office, regardless of who occupies that post or what party is in power?” Following is LifeSite’s summary of the most significant elements of the Desmarais web of influence.

* Current Prime Minister Jean Chretien sat on the board of Power Corp. subsidiary Consolidated Bathurst Inc. before becoming leader of the Liberal Party. Chretien’s daughter France is married to Paul Desmarais’ son Andre. Andre was involved in Canadian power station projects in China. Chretien personally withdrew Canadian support of a UN condemnation of China’s human rights abuses after Chinese officials threatened to take power station projects away from Canadian firms. The Prime Minister’s nephew, Raymond Chretien, is now Canada’s Ambassador to France.” Chretien’s “advisor, counsellor and strategist” for the past 30 years has been Mitchel Sharp, who brought Chretien into politics when he was Finance Minister. From 1981 onwards Sharp was Vice-Chairman for North America of David Rockefeller’s Trilateral Commission.

* In her April 17, 2003 National Post column Diane Francis notes that Chretien heir apparent, Paul Martin, was hired in the 1960s to work for Paul Desmarais senior by Maurice Strong. In 1974, Francis writes, “Desmarais made Martin president of Canada Steamship Lines and then, in 1981, made him spectacularly rich by selling the company to him and a partner…” She follows, “It all begs a number of questions, Did Mr. Desmarais give away the company to Mr. Martin? Did Mr. Desmarais lend him the money or guarantee the loan? And what does this mean in terms of his allegiance or loyalty to Mr. Desmarais and his empire in Canada and France.”

* An August 5, 1994 Globe and Mail article noted that “Another prime minister, long-time family friend, Pierre Trudeau (now deceased), sits on Power’s star-studded international advisory board.”

* Ted Johnson, A former Trudeau assistant, and a friend of Chretien’s chief of staff, Eddie Goldenberg (more powerful than most MPs and even Cabinet Ministers), was vice-president, secretary and legal counsel to Power Corp.

* Michael Pitfield, the super-bureaucrat under the Trudeau government, was a vice-chairman of Power Corp and is still listed as a Director Emeritus.

* Maurice Strong became President of Power Corp by his mid-thirties. From there he became a Liberal Party bureaucrat and created the controversial, left-wing Canadian International Development Agency (CIDA). In 1976, still under Prime Minister Pierre Trudeau, he was appointed to run Petro Canada, the state-run oil company. This wealthy ex-Desmarais employee is an architect of the Kyoto accord and has been a powerful advocate of UN world governance and world de-population.  He is an advisor to both the UN Secretary General and the president of the World Bank. With former Soviet President Michael Gorbachev he co-authored the infamous “Earth Charter” which Strong, Gorbachev and numerous prominent allies are hoping will guide a new world order based on “planetary ethics”. The Charter reads like a new age ten commandments and includes language supporting abortion. Strong also supports a one world religion. See http://www.lifesite.net/ldn/2000/jun/00063006.html See also http://www.lifesite.net/ldn/2000/jan/00011302.html

* Former Prime Minister Brian Mulroney and Desmarais go back at least as far as 1972. Mulroney friend Ian MacDonald described Desmarais as “Mulroney’s mentor in the business world.” Mulroney has done legal work for Desmarais since his spectacular election loss at the end of his second term as Prime Minister.

* Former Mulroney Cabinet Minister Don Mazankowski is currently Power’s company director.

* Former Ontario Conservative premiers William Davis and John Robarts sat on Power’s national advisory board.

* John Rae, the brother of former Ontario New Democratic (Socialist) Premier Bob Rae is currently listed as Power’s Executive Vice-President, Office of the Chairman of the Executive Committee (Paul Desmarais).

* Former Quebec premier Daniel Johnson worked for Power from 1973 to 1981 and in the last of those three years was vice-president.

* The May 11, 1996 Toronto Star reported that “Desmarais’ worldwide political connections have resulted in an international advisory board featuring such luminaries as former German chancellor Helmut Schmidt; Sheikh Ahmed Zaki Yamani, former oil minister of Saudi Arabia, Paul Volcker, former head of the U.S. Federal Reserve Board and former prime minister Pierre Trudeau.”

* There have been indications that the fabled de Rothchild family of Europe has been playing a role in Desmarais’ international expansion. For example, the Nov. 20, 2002 Financial Post covered the opening of Sir Evelyn de Rothchild’s investment bank’s Montreal office. Quebec’s business elite were present in force, headed by – Paul Desmarais Jr.

Ottawa Citizen’s Gessell ends his column on Desmarais, “When Chretien retires and a leadership convention is held to replace him, chances are Desmarais will be on hand. Finance Minister (now former) Paul Martin (from Quebec, as were Trudeau, Mulroney and Chretien) could quite possibly be Chretien’s successor. And who taught Martin how to succeed in business? None other than his former employer, Paul Desmarais.”

See Power Corporation’s website
http://www.powercorporation.com/index.php?lang=eng

See also
Saturday Night magazine, February 1996
The Globe and Mail August 5, 1994
The Toronto Star may 11, 1996
Diane Francis in The Financial Post April 1 and April 17, 2003

Friday, March 8, 2024

DOTS, DOTS, B.C. DOTS TO CONNECT

Basi-Virk\The Legislature Raids,Li Ka-Shing & PowerCorp

 Sunday, July 06, 2008

.
The following presentation is lengthy but it's good. A reader has generously contributed this research on the connections between the players in VANOC and BCRail (an oversimplification on my part). The research is presented exactly as received, for the benefit of others. Send your comments. Very special thanks to the unknown person who gathered and sorted all this information for us. - BC Mary.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Li Ka-Shing

Terry Hui with former Vancouver city planner Larry
Beasley

with links to the BC Rail deal.
FOR IMMEDIATE RELEASE
June 12 2003
RE: Plundering BC: Olympics, The Bid Corp, and Special Interests

1. Who's who in the Bid Corp? Some special members and their 'interests':
-Concord Pacific (Li Ka-Shing and Hui family owned), developer of the former Expo 86 lands (one-sixth of downtown Vancouver) is significantly represented on the Bid Board with David McLean (Chairman of the Board and a Director of Concord Pacific Group Inc.) and Kwok Tun-Li, Stanley (Former Deputy Chairman for Concord Pacific).

2. David McLean is also involved with the following business interests:

a) Founding Chairman of the Vancouver Board of Trade Foundation
b) Founder and Chairman, Vancouver Film Studios (another BC
government-funded private entity)
c) Chairman of the Board, The McLean Group, which has developed numerous residential, office, retail and industrial properties
d) past Chair the Canadian Chamber of Commerce
e) Director, DeHavilland Aircraft of Canada
f) Director, Northwestel
g) Director, CANAC Consultants Ltd.
h) Director, Nu West Group
i) Founding Chairman of Westech Information Systems, the former information systems arm of B.C. Hydro, and led the company through privatization from its parent company
j) Former Chairman of the Board of Coastland Wood Industries
*k) One of twenty-two business delegation members led by Premier Gordon Campbell to attend 2002 World Economic Forum.

-Mr. McLean is also involved with the following business interests:
Chair, CN Rail (frontrunner to purchase the soon-to-be-privatized BC Rail) Founding Chairman of the Vancouver Board of Trade Foundation Founder and Chairman, Vancouver Film Studios
Chairman of the Board, The McLean Group (which has developed numerous residential, office, retail and industrial properties)
Director, DeHavilland Aircraft of Canada
Director, Northwestel,
Director, CANAC Consultants Ltd.
Director, Nu West Group Founding Chairman of Westech Information Systems (the former information systems arm of B.C. Hydro, and led the company through privatization from its parent company). Former Chairman of the Board of Coastland Wood Industries Chair, CN Rail.

3. Stanley Tun-Li Kwok and Bid Corp, reported as 'Mastermind of Expo '86', is also involved in a multitude of multinational businesses:

a) Principal, Stanley Kwok Consultants Inc.

b) Director, Cheung Kong (Holdings) Limited (The Cheung Kong Group, owned principally by Li ka-Shing operates in 41 countries and employs over 163,000 staff worldwide)
c) Development Consultant for the South East Shore of False Creek
d) Director of Omnipoint Corporation, priceline.com Incorporated, VoiceStream Wireless Corporation, Western Wireless Corporation, Global Crossing Ltd., Breakaway Solutions Inc.
d) Director, Amara International Investment Corporation (a Vancouver-based private company specializing in real estate investment and in locating Chinese partnerships for projects).
e) Director, CTC Bank of Canada
f) Director, Husky Energy Inc.
g) Principal, Stanley Kwok & Associates,(worked on the Concord Pacific development on the former Expo lands on the north shore of the Creek)
h) Joint Venture Partner with TYBA Group Inc and Dong Ah Construction Industrial of Seoul, South Korea in the Crystal Project , a CAN$200 million development in suburban Vancouver that also includes 55,000 square feet of office space, a 210,000 square-foot retail area, a 22,500 square-foot conference center and a 218-unit residential complex.

i) Former Director, BC Hydro
j) Director, Bank of Montreal -Vancouver hosted Expo'86, an international event not unlike the scale of the proposed 2010 Winter Games. One and a half years later, then Premier Bill Vander Zalm concluded the sale of the Expo lands (84- hectare site on False Creek, representing one-sixth of downtown Vancouver) to Li Ka-Shing (and the Hui family) for a reported price of $145 million (said by many to be far too low, especially considering the tens of millions of dollars the province spent to complete the environmental clean-up of the site). Subsequently, his company, Concord Pacific Holdings, redeveloped the site into a multi-billion dollar downtown residential community. Bid Board Member, Stanley Tun-Li Kwok describes himself at one of his corporate websites as 'Mastermind of Expo '86'.|

-Mr. Kwok is Former Deputy Chairman for Concord Pacific (Bid Corp Director David McLean is the current Chairman of the Board of Concord Pacific).
-Concord Pacific is the owner of Burcon International Developments Inc., one of North America's leading real estate development, investment and management organizations with assets over C$1 billion and based in Vancouver, B.C.
-Burcon is the controlling shareholder of Oxford Properties Group Inc. (owner of Marathon Realty).
-Mr. Kwok is Principal, Stanley Kwok Consultants Inc. and Development Consultant for the South East Shore of False Creek. He is also a Director of Li Ka-Shing's Cheung Kong (Holdings) Limited (The Cheung Kong Group operates in 41 countries and employs over 163,000 staff worldwide with a combined market capitalization of HK$439 billion as at January 31, 2003).
Kwok is Director, Amara International Investment Corporation (a Vancouver-based private company specializing in real estate investment and in locating Asian partnerships for projects). His additional Directorships include: Li Ka-Shing's companies: Omnipoint Corporation, priceline.com Incorporated, VoiceStream Wireless Corporation, Western Wireless Corporation, Global Crossing Ltd., Breakaway Solutions Inc. and Husky Energy Inc. (Husky Board Members also include: Stanley's wife Eva, Terry
Hui, President and CEO of Concord Pacific Group Inc., Martin Glynn President, Chief Executive Officer and a director of HSBC Bank and Victor Li, son of Li Ka-shing, Managing Director and Deputy Chairman of Cheung Kong (Holdings) Limited Canada). Bank Director positions include: Bank of Montreal and CTC Bank of Canada. Additionally, he is a Joint Venture Partner with TYBA Group Inc and Dong Ah Construction Industrial of Seoul, South Korea in the Crystal Project , a CAN$200 million development in suburban Vancouver that also includes 55,000 square feet of office space, a 210,000 square-foot retail area, a 22,500 square-foot conference center and a 218-unit residential complex.

As noted, Concord Pacific, Li Ka-Shing and Hui family owned, is
significantly represented on the Bid Board with David McLean (Chairman of the Board and a Director of Concord Pacific Group Inc.) and Stanley Kwok Tun-li (Former Deputy Chairman for Concord Pacific).

4. Other Bid Corp directors and their interests:
-HSBC (of which Li Ka-shing is a Principal and Director) is aptly
represented on the Bid Board by Eric Major, Director, HSBC Capital (Canada) Inc. and Milton Wong, Chair, HSBC Asset Management Canada Ltd. (responsible for assets of $4 billion at HSBC). HSBC purchased M.K. Wong & Associates to form HSBC Asset Management Canada Ltd. Merrill Lynch Canada (reportedly owned by Thomas Fung, Fairchild Group) is represented on the Bid Board by Guy Savard, Vice-Chair & Chair, Quebec Operations, Merrill Lynch Canada Inc. Merrill Lynch International is owned by Li Ka-shing and Thomas Fung. Bid Board Member, Ms. France Chrétien-Desmarais is daughter of the Honourable Jean Chretien, Prime Minister of Canada.

-Mr. Chretien, was from 1986 to 1990 a Senior Advisor with Gordon Capital Corporation in Montreal.
-Gordon Capital is principally owned by Richard Li (Li Ka-Shing's son) Gordon Capital owns HSBC Securities.

-Ms. Chretien-Desmarais husband is Andre Desmarais, President and Co-Chief Executive Officer of the family-owned Power Corporation of Canada. Power Corporation of Canada is a diversified management and holding company. Power Corporation of Canada has holdings in leading financial services and the communications sector.

-Through its European-based affiliate Pargesa group, Power Corporation holds significant positions in major media, energy, water, waste services, and specialty minerals companies. Power Corporation also has diversified interests in China.

-Power Financial Corporation is a diversified management and holding company with interests in the financial services industry in North America. Including: Great-West Lifeco Inc.: The Great-West Life Assurance Company, London Life Insurance Company, Great-West Life & Annuity Insurance Company. Investors Group Inc. is one of Canada's leading financial services companies with over $41.6 billion in assets under management and a network of 3,400 consultants.

-Mackenzie Financial Corporation is an integrated financial services company whose core business is the management of mutual funds in Canada, with $33.4 billion in assets under management, and distribution relationship with over 37,000 independent financial advisers. Pargesa Holding S.A. holds significant positions in a selected number of large companies based in Europe. These companies operate in strategic industries including media, energy, public utilities and specialty minerals.

-Gesca Ltée holds a 100 per cent interest in the Montreal daily newspaper La Presse and six other daily newspapers in the province of Quebec and Ontario.

-Power Corporation of Canada is a partner with Li Ka-Shing in CITIC Pacific Limited (China's largest diversified Hong Kong-traded company. Its activities are concentrated in four main areas: infrastructure, trading and distribution, real estate and industrial manufacturing). Mr. Desmarais is a Director and/or Member of the Board of: Great-West Lifeco Inc., Investors Group Inc., London Insurance Group Inc., Pargesa Holding S.A.,
Groupe Bruxelles-Lambert S.A., Bertelsmann A.G. Mr Desmarais is also a Director of CITIC Pacific Ltd. and Bombardier Inc.

-In addition, Mr. Desmarais is Chairman of the Canada China Business Council; Member of the International Advisory Council of CITIC; Member of the Trilateral Commission; Member of the Chairman's International Advisory Council of the Americas Society; Member of the Business Council on National Issues and Member of diverse foundations and trusts in Canada and a Member of the Hong Kong Chief Executive's Council of International Advisers (The CECIA advises the Chief Executive from an international perspective on strategic issues pertinent to the long-term development of
Hong Kong).

- Ms. Chretien Desmarais' husband Andre Desmarais

  is a Director of Bombardier Inc.

-Also on the 2010 Games Bid Board is Mr. Laurent Beaudoin, Chair,
Bombardier Inc. Bombardier stands to gain significantly from their supply of the $1.5 billion to $2 billion Vancouver/Richmond Rapid Transit line proposed by the 2010 Bid Corp.

5. Bid Corp and the Sea to Sky Corridor:

The ski resort industry stands to make significant profits from the 2010 Winter Games.
-Intrawest is represented on the Bid Board by Doug Forseth, Senior VP, Operations, Whistler and Blackcomb Mountains. TAL Global Asset Management (owned by CIBC) is the largest institutional shareholder of Intrawest (reportedly 15%). Li- Ka-shing is the largest shareholder (maximum allowable 10%) of CIBC. CIBC owns Wood Gundy. Intrawest is the leading developer and operator of village-centered destination resorts across North America. Intrawest owns or is involved in 14 mountain resorts in North America and Europe along with two warm-weather resorts in the U.S.

-The company also has an interest in Alpine Helicopters Ltd., owner of Canadian Mountain Holidays, the largest heli-skiing operation in the world and Compagnie des Alpes, the largest ski operator in the world in terms of skier visits (13 million in 2000/2001).

-Intrawest also has land on which to build 20,000 more units. Intrawest holdings include ski resorts, residential communities, retail, hotels and lodges.

-The Bid Corp. has identified rental costs payable to Intrawest for
facility usage during the Winter Games at $10 million to $30 million. In addition to Concert Properties' real estate development interest in other ski resorts and Intrawest's vast resort holdings, other Bid Board members are intimately involved in the ski resort industry, including:

a) Kerrin Lee-Gartner (listed as Canadian Olympic Athlete - Alpine Skiing) is Principlal, Kerrin Lee-Gartner's Snow Creek Lodge and Principal, Fernie Alpine Resort
b) Nancy Greene Raine (listed as Director of Skiing, Sun Peaks Resort; Canadian Olympic Athlete - Alpine Skiing) is Principal, Nancy Greene's  Cahilty Lodge, Sun Peaks, BC; President, NGR Resort Consultants Inc.; Proponent with husband Al Raine of Melvin Creek/Cayoosh, $500 million four-season ski resort (90 minute drive from Whistler). Al Raine was responsible for the planning of Whistler.

-Mr. Caleb Chan (along with brother Tom Chan) has considerable businesses assets in British Columbia and abroad. Of particular note are the holdings in Vancouver, Furry Creek, Whistler, etc. directly impacted by the 2010Vancouver/Whistler Olympic Games:

Mr. Chan serves as:

a) President & Chairman, Burrard International
b) President & Chairman, The International Land Group, San Francisco
c) Director, UBC Properties Trust
d) Director, Belkorp Industries Inc. - Through several companies active in British Columbia, Alberta, Washington, and Oregon, the Belkorp Group owns and operates: an extensive portfolio of properties comprising approximately ,500 residential apartment suites, five industrial sites, and Big Sky Golf, an award-winning course, conveniently located near Whistler in the Pemberton Valley of British Columbia. In addition, the Belkorp Group invests in various long-term business opportunities as a merchant banker. Its holdings include significant interests in Rogers Sugar Income Fund and Canadian Hotel Income Properties Real Estate
Investment Trust (CHIP REIT), an integrated hotel real estate investment trust focused on mid-market and upscale full-service hotels. CHIP REIT currently owns or manages 38 hotels with approximately 8,400 rooms. The Belkorp Group owns and operates four businesses in the pulp and paper production industry: Newstech BC reprocesses 165,000 tonnes of used newsprint annually at its ISO9002 production facilities in Coquitlam,

British Columbia, producing recycled pulp for the newsprint industry;
Wastech Services one of the largest privately-owned solid waste management companies in British Columbia, handles approximately 600,000 tonnes per annum of municipal waste at three transfer stations in Greater Vancouver and operates a landfill at Cache Creek for the GVRD ; Belkin Paper Stock brokers waste paper from suppliers in Western Canada and the U.S. to mills which use recycled fiber. This company also has established a newsprint roll splitting and rewinding operation in Coquitlam. Waste-Not Recycling and Disposal, located in Richmond, British Columbia, provides recycling and waste removal services for the residential, industrial, commercial, and institutional sectors of the Greater Vancouver, British Columbia region.

e) Director, Board of Trustees, Canadian Hotel Income Properties

f) Principal, GolfBC Properties: Kelowna: The Okanagan Golf Club, The Bear at Okanagan Golf Club, The Quail at Okanagan Golf Club, Gallagher's Canyon Golf & Country Club, The Pinnacle Course at Gallagher's Canyon Whistler:
Nicklaus North Golf Course & Crystal Lodge Furry Creek: Furry Creek Golf & Country Club Vancouver: Mayfair Lakes (Richmond) & Burrard Golf & Tennis (at Burrard & Alberni, Vancouver) Vancouver Island: Arbutus Ridge Golf &
Country Club (Cobble Hill) & Olympic View Golf Club (Victoria) Other GolfBC properties: Burrard Golf & Tennis & The Crystal Lodge, Whistler

g) Principal, CRC Developments Ltd.( The company owns golf course residential developments)

h) Principal, Gallagher's Canyon Land Development Ltd.

i) Nicklaus North, in Whistler, B.C. and Arbutus Ridge on Vancouver Island are two examples of communities CRC has developed.

j) Currently in the planning stages is the development of a new community at the Olympic View Golf Course in the Victoria area on Vancouver Island.

k) Goldenwood Townhouse Project, Whistler, BC.

l) member of the advisory board of the Asia Pacific Initiative in Vancouver

m) Director, B.C. Housing Management Corporation

n) Director, Land Planning Committee of the Loma Linda University Development Corporation

Perhaps this is a good time to re-visit the $billion question:

6. The Toronto 2008 Bid: Connections or Coincidences?

-Li’s Concord Pacific's City Place is a 44-acre development site in
downtown Toronto, on which 5.5 million square feet of residential and commercial space are to be built.

-Li Ka-Shing also holds an exclusive right to use the CN Tower for a period of 35 years (obtained for $2 billion CDN). Financier Robert
Fung, was appointed by Prime Minister (and former business partner) Jean Chretien to Chair the Toronto Waterfront Revitalization Task Force on behalf of the Government of Canada, the Province of Ontario and the City of Toronto. The new corporation was to involve construction of large-scale infrastructure projects that would permanently improve Toronto's waterfront, as well as support the city's bid for the 2008 Olympics.

-His report detailed a strategic business plan for the $12 billon renewal, development and financing of Toronto's waterfront. Fung was afterward appointed as Chair of the Toronto Waterfront Revitalization Corporation.

-Robert A. Fung is Deputy Chairman of Yorkton Financial Incorporated. From 1980 to 1997, he was the vice-chairman and a director of Gordon Capital Corporation.

-Upon leaving Gordon Capital, he joined Capital West where he was a senior partner. From 1967 to 1978, he was vice-president and a director of Dominion Securities Limited with responsibilities for its investment activities in China and the Middle East.

-He began his career in the investment industry in 1964 with Wood Gundy. He is Chairman of Crystallex International Corporation, SMART Toronto as well as a director of Canada's Export Development Corporation, Asia Pacific Foundation of Canada, GLOBE Foundation of Canada, and StockHouse
Media Corporation.

-He was a member of the Prime Minister of Canada's Advisory Committee on Asia Pacific Economic Cooperation, as well as a member of the Government of Canada's Department of Industry International Trade and Agriculture Team Canada Inc. Advisory Board, which provided advice to the Government
of Canada in setting strategic direction and performance objectives for
Canada's International Business Development.

-He was also deputy-chairman of high-tech brokerage Yorkton Securities Inc. and Executive Chairman of Crystallex International Corp.

-Fung's son Robert Fung Jr. worked as a developer on Vancouver's False Creek development with Concord Pacific Group Inc.

-Fung's university roommate, long-time friend Paul Martin, prime minister in waiting, was a former senior executive with Power Corp. and Consolidated Bathurst. Martin served as CEO of both CSL Inc. and Canada Steamship Lines. Martin eventually purchased Canada Steamship Lines from Power Corp. for $180 million.

7. Who benefits the most from the 2010 Winter Games and the associated mega projects?

-Bombardier is highly represented on the Bid Corp and stands to pick up a multi-billion contract for the proposed Vancouver/Richmond line.

-Original Bid Society Member, Arthur Griffiths, was Chair of Public
Consultation, Rapid Transit Project 2000, charged with the public-view
task of addressing our rapid transit needs.

Convention Centre:
-Bid Board Members are on the Convention Centre Expansion Task Force Chair Peter Armstrong and Rick Antonson, Member & Spokesperson, Convention Centre Expansion Task Force who are the ones that have told us how badly we need the expansion, irrespective of the Winter Games.

-The three approved Convention Centre Expansion bidders were Concert
Properties, Concord Pacific and Marathon Realty.

-2010 Bid Board Members: Jack Poole, David Podmore and Ken Georgetti proposed to build the Convention Centre, inclusive of a casino, almost a decade ago. Sea To Sky Highway as well.