Shawinigate was a 1990s
Canadian political scandal in which
Prime Minister
A prime minister, premier or chief of cabinet is the head of the cabinet and the leader of the ministers in the executive branch of government, often in a parliamentary or semi-presidential system. Under those systems, a prime minister i ...
Jean Chrétien was accused of profiting from
real estate
Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more general ...
deals and government policies in his hometown of
Shawinigan, Quebec
Shawinigan () is a city located on the Saint-Maurice River in the Mauricie area in Quebec, Canada. It had a population of 49,349 as of the 2016 Canadian census.
Shawinigan is also a territory equivalent to a regional county municipality (TE) and ...
.
The scandal
In 1988, prior to becoming prime minister, Chrétien and two business partners had purchased the $625,000
Grand-Mère Golf Course
A golf course is the grounds on which the sport of golf is played. It consists of a series of holes, each consisting of a tee box, a fairway, the rough and other hazards, and a green with a cylindrical hole in the ground, known as a "cup". ...
and
Auberge Grand-Mère Hotel. In 1993, six months before he became prime minister, Chrétien and his partners agreed to sell the hotel to
Yvon Duhaime, a personal friend of Chrétien.
A month after becoming prime minister, Chrétien agreed to sell his personal shares in the golf course to Toronto tycoon
Jonas Prince. However, by January 1996, Chrétien was still the formal owner of the golf course since Prince had never paid for the shares. He reported this fact to the
Federal Ethics Counsellor,
Howard Wilson
Howard Wilson (born October 30, 1995) is an American football cornerback who is a free agent. He played college football at Houston, and was drafted by the Cleveland Browns in the fourth round of the 2017 NFL Draft.
Professional career
Wilson ...
.
Meanwhile, new hotel owner Yvon Duhaime applied to the
Business Development Bank of Canada
The Business Development Bank of Canada (BDC; french: Banque de développement du Canada) is a Crown corporation and national development bank wholly owned by the Government of Canada, mandated to help create and develop Canadian businesses throu ...
for a $2,000,000 loan to expand the hotel. Chrétien took a personal interest in the transaction, and both phoned and met with the bank's director, but to no avail – Duhaime's application was declined.
In early 1997, Chrétien began asking the bank if it would be possible to extend a smaller loan to expand the hotel. The bank agreed to loan Duhaime $615,000 and the
Federal Human Resources Department awarded Duhaime an additional $164,000 grant.
The scandal comes to light
The scandal came to light slowly, with information only being released by the governing
Liberal Party
The Liberal Party is any of many political parties around the world. The meaning of ''liberal'' varies around the world, ranging from liberal conservatism on the right to social liberalism on the left.
__TOC__ Active liberal parties
This is a li ...
after a series of newspaper reports and after persistent questioning by members of the Opposition in the
House of Commons of Canada, and a formal lawsuit.
In 1999, Ethics Commissioner Wilson ruled that Chrétien had not violated any ethical boundaries when the hotel was awarded federal grant money although he later admitted that he was unaware Chrétien had taken such a personal interest by meeting with the bank president in an effort to secure the $615,000 loan.
While Chrétien faced harsh criticism from all opposition parties,
Stockwell Day, then-leader of the
Canadian Alliance
The Canadian Alliance (french: Alliance canadienne), formally the Canadian Reform Conservative Alliance (french: Alliance réformiste-conservatrice canadienne), was a centre-right to right-wing federal political party in Canada that existed ...
, denounced him calling him a "criminal",
while
Joe Clark
Charles Joseph Clark (born June 5, 1939) is a Canadian statesman, businessman, writer, and politician who served as the 16th prime minister of Canada from 1979 to 1980.
Despite his relative inexperience, Clark rose quickly in federal polit ...
continued an investigation accusing Chrétien of abusing power, and demanded that he resign as prime minister until a
public inquiry could be held.
Litigation
In September 2003, the former president of the bank that had initially declined the loan won his
wrongful dismissal
In law, wrongful dismissal, also called wrongful termination or wrongful discharge, is a situation in which an employee's contract of employment has been terminated by the employer, where the termination breaches one or more terms of the contra ...
claim, and it was ruled that he was fired because he had suggested that it was time to collect on the $615,000 loan in 1999.
In early March 2008, Ontario's top court ordered the ''
National Post
The ''National Post'' is a Canadian English-language broadsheet newspaper available in several cities in central and western Canada. The paper is the flagship publication of Postmedia Network and is published Mondays through Saturdays, with ...
'', a major Canadian newspaper, to hand over documents in the "Shawinigate" allegations, saying the need to enforce the law should outweigh the need to protect anonymous sources. In May 2010, the National Post lost its appeal, with the Supreme Court of Canada reinstating the search warrant despite the newspaper's claims of journalist-source privilege under
Section Two of the Canadian Charter of Rights and Freedoms.
[{{cite web, url=http://scc.lexum.org/en/2010/2010scc16/2010scc16.html, title=Supreme Court of Canada Decision, R. v. National Post, website=lexum.org, url-status=dead, archiveurl=https://web.archive.org/web/20120118151937/http://scc.lexum.org/en/2010/2010scc16/2010scc16.html, archivedate=2012-01-18]
References
Political scandals in Canada