OTTAWA — What kind of allegation or RCMP scrutiny will get a Conservative booted from caucus?
According to Prime Minister Stephen Harper, allegations of a civil or “private” nature don’t cross the line, and that’s why Alberta MP Devinder Shory is still sitting with his Tory colleagues.
Shory is one of dozens of people named in a Calgary lawsuit alleging a $70-million mortgage fraud — one of the largest in Canadian history — against the Bank of Montreal.
“Mr. Shory, this is a civil action, it’s not a criminal matter, it’s a private matter,” Harper told reporters Thursday during a trip to the Netherlands.
“Its origin is before he became a member of Parliament and it’s before the court, so I’m not going to comment.”
Harper was asked to compare the cases of Shory and former junior cabinet minister Helena Guergis. The prime minister removed Guergis from caucus after a private investigator came to the party with allegations ranging from potential tax evasion to compromising photographs.
The Guergis matter also features some aggravating circumstances, although Harper has never specifically mentioned them. Her husband, former Tory MP Rahim Jaffer, is facing allegations of illegal lobbying. And Guergis embarrassed the party in February when she threw a tantrum at Charlottetown airport.
This week, she learned she would not be the Conservative candidate in her riding during the next election.
But opposition leaders were having trouble seeing the distinction between the Guergis and Shory cases. In both, the RCMP are examining whether they should launch a full criminal investigation. Like Shory, Guergis has yet to be charged with any crime and insists she’s done nothing wrong.
“There are some very serious allegations from a very credible third party, and we have to believe the Bank of Montreal is a more credible third party than a private investigator…” Layton said in the House of Commons.
“What is the difference between him and member for Simcoe—Grey? Why did the government not call in the RCMP? Why is the member still sitting in the Conservative caucus?”
Bloc Quebecois Leader Gilles Duceppe had some of the same questions.
“We’re talking about a bigger scandal and there are investigations underway,” he said. “There aren’t any charges, but as far as I know there aren’t charges against Ms. Guergis either…
“I think that this MP, while an investigation is underway, should at least sit outside of caucus until the matter is cleared up.”
Shory was elected to Parliament in 2008. He serves on the joint security and regulations committee, and the natural resources committee.
The Bank of Montreal says it has been scammed in several schemes in Western Canada that were first flagged in a security check four years ago. It alleges the defendants found houses valued below others in upscale neighbourhoods, then paid people a few thousand dollars to put their name on a mortgage application.
Documents were then forged to inflate the value of the property and to fool the bank into believing the buyer had the ability to pay. Once the mortgage was approved, the fraudsters pocketed the profit and the money was sent overseas, the bank alleges.
It says the mortgages were worth $69.5 million. After foreclosures, it expects the gross loss to be $30 million and hopes through the lawsuit and other means to reduce the loss even further.
According to the statement of claim, Shory was among a number of lawyers associated with a group of defendants that were allegedly identifying properties to be used in the fraudulent schemes. The group would then find and pay so-called “strawbuyers” to apply for the mortgage, the sums ranging between $3,000 and $8,000.
The allegations have yet to be proven in court. There have been no charges laid in connection with the allegations.
Shory said in a statement that he hasn’t yet been served with the statement of claim.
“When I am, I will defend myself vigorously against these accusations. I have done nothing wrong.”
He added that the Bank of Montreal has been quoted as saying, ’We do not allege fraud against him.“