AP News, November 10th, 2007
Canada's leader announced a review Friday into dealings between former Prime Minister Brian Mulroney and a businessman who's wanted in Germany on tax and fraud charges.
The move follows opposition Liberals' demands for a full investigation into allegations that German businessman Karlheinz Schreiber paid $300,000 to Mulroney in 1993 and 1994 to enlist his help in building an arms factory in Quebec and a pasta business in Ontario.
But Prime Minister Stephen Harper said he was appointing an independent adviser to look into the matter and recommend what the government should do, saying such a probe could be an option later.
Mulroney, who served as Canada's Conservative prime minister from 1984 to 1993, has denied the charges and released a statement saying he will cooperate fully with the review.
Schreiber has filed suit against Mulroney in an effort to recover the money, arguing that Mulroney did not follow through on his commitments.
Harper's announcement followed an affidavit filed by Schreiber Thursday in Ontario Superior Court with new claims against Mulroney — and for the first time a mention of Harper.
Schreiber alleged that a Mulroney adviser once asked him to transfer funds, in connection with Air Canada's 1988 purchase of Airbus planes, to a Mulroney aide.
As for Harper, the affidavit claims that Mulroney told Schreiber about an upcoming visit to the current prime minister's country estate in July 2006. It alleges that Mulroney promised to discuss Airbus there.
The Conservative leader acknowledged that he hosted Mulroney in August 2006, but insisted that the matter never came up.
But Harper said he was naming the adviser because the issue was serious. "The allegations do touch upon Mr. Mulroney's term of office — which is why we believe we can't ignore the allegation. We always must protect the office of the prime minister," Harper said.
The prime minister also warned members of his government not to deal with Mulroney until the issue is resolved.
Schreiber is facing extradition to Germany as early as next week. Germany alleges that Schreiber, who has dual Canadian-German citizenship, avoided paying income tax on $46 million in commissions. The fraud charges against him arise from a deal for the sale of German army tanks to Saudi Arabia.
