Ottawa orders ‘urgent’ probe into Crown corporation chair over conflict of interest

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The federal government has ordered an “urgent” investigation into the business activities of the Liberal-appointed chair of a Crown corporation after learning that she worked as a consultant for an Ontario construction company shortly after she resigned as its top executive to resolve a conflict of interest.

The Globe and Mail discovered on Thursday that Moreen Miller’s work for Fowler Construction Co. Ltd. didn’t end after she resigned as president in September, 2018, and maintained her part-time position as chair of Defence Construction Canada (DCC). She later helped Fowler on a quarry project in a township near Orillia, Ont.

The government has also asked Ethics Commissioner Mario Dion to investigate Ms. Miller, who was appointed in 2017 as chair of DCC, which handles military infrastructure contracts. The Globe reported on Thursday morning that DCC had suspended Fowler from bidding on contracts while Ms. Miller was chair, but lifted the suspension after she resigned.

Ms. Miller, a veteran of the construction industry who was named to two advisory agencies by the former Ontario Liberal government, did not return a phone call and e-mail seeking comment.

Public Services and Procurement Minister Carla Qualtrough, who had defended the appointment of Ms. Miller over the objections of DCC’s then-chief executive officer and independent directors, on Thursday said an internal probe has been launched.

“Neither the minister nor her office was aware of these allegations prior to today," Ms. Qualtrough’s press secretary, Marielle Hossack said in an e-mail to The Globe. "The minister has directed her officials to investigate this matter on an urgent basis.”

DCC’s spokesperson Erica Lyle also told The Globe the corporation had “engaged the office of the conflict-of-interest and ethics commissioner in this matter.”

In late 2018, Ms. Miller assured DCC’s chief executive officer, James Paul, and Mr. Dion that she had severed all ties with Fowler, according to internal e-mails obtained by The Globe. Mr. Paul’s term was not renewed after it expired in July, 2019, and he is suing the government, alleging he was punished for raising concerns about Ms. Miller’s apparent conflict of interest, The Globe reported on Thursday.

Ms. Miller’s appointment as chair of DCC in November, 2017, sparked an internal battle over potential conflict of interest when she said Fowler Construction should be allowed to continue bidding on DCC contracts.

DCC’s five independent directors resigned in protest last year, citing what they considered insufficient action from Ms. Qualtrough to address the issue.

Mr. Paul suspended Fowler from bidding for DCC work in April, 2018, and Mr. Dion instructed DCC to set up a conflict of interest screen to ensure Ms. Miller did not make any decisions that could benefit Fowler.

The conflict of interest screen and the suspension ended late last year after Ms. Miller resigned as president of Fowler and assured DCC and Mr. Dion’s office she no longer had any private interest in the company.

Ms. Lyle of DCC said late on Thursday that the Crown corporation had not awarded any contracts to Fowler since Ms. Miller stepped down as president and the bidding suspension was rescinded.

Ms. Miller told DCC on Nov. 1, 2018, in an e-mail that she had no remaining interest in Fowler. She offered the same assurance to the ethics commissioner’s office on Sept. 27. And in an e-mail on Oct. 1, 2018, Ms. Miller told Mr. Dion’s office: “I can confirm that that my only private interest in Fowler was as an employee and that interest ended on Sept. 14. None of my relatives or close friends have a private interest in Fowler.”

But local officials in the township of Ramara, near Orillia, told The Globe that as early as December, 2018, Ms. Miller was helping Fowler with a proposed quarry expansion in their area.

On Dec. 19, 2018, Ms. Miller met with Township of Ramara Mayor Basil Clarke and councilor David Snutch on behalf of Fowler. Another Fowler representative was also present. “She said she was retired, like past president, but she was helping them with this file as, say, an unofficial consultant, because she had the history on the quarry in our township,” Mr. Clarke recalled.

He said the meeting was to discuss Fowler’s request for rezoning of a local quarry so the company could extract more rock. Mr. Snutch said Ms. Fowler told him that while she had resigned from Fowler “she been brought on as consultant to push through this rezoning application in Ramara township.”

On July 11, 2019, Ramara township held a public meeting to discuss Fowler’s rezoning request. Ms. Miller attended with Fowler officials. A photo of Ms. Miller at the meeting was later published by the media outlet OrilliaMatters.com. David Donnelly, a lawyer acting for a local citizens group, the Ramara Legacy Alliance, that was fighting the quarry expansion, said Ms. Miller took an active part at the meeting along with Fowler executives.

“The mayor asked for the [Fowler] operations manager to get up to speak, and Ms. Miller grabbed him and said, ‘Don’t get up there.’ She was right in the middle of their operations team and experts,” Mr. Donnelly said.

Later in July, Ramara township rejected Fowler’s rezoning request. Fowler has appealed the decision to the Local Planning Appeal Tribunal (LPAT).

On Aug. 7, 2019, Ms. Miller, on behalf of Fowler, met with Ramara township’s chief administrative officer John Pinsent, along with other Fowler representatives, regarding the quarry application. Mr. Pinsent said his assumption was Ms. Miller “was a member of Fowler’s management team.” He said he did not know her precise capacity, but had been told she was a past president of the company.

In a lawsuit filed earlier this month, Mr. Paul, the former chief executive officer of DCC, says Ms. Qualtrough appointed Ms. Miller as chair despite concerns he and the five independent directors, who arrange procurement for military infrastructure projects, had raised.

Mr. Paul further alleges that one of Fowler’s owners, Bill Graham, who was defence minister in a former Liberal government, and a defence policy adviser to the Trudeau government, would have been aware of the benefits of having an executive from his construction company on the board of DCC.

“Mr. Graham therefore has inside knowledge of the opportunity that Defence Construction Canada’s work presented for Fowler and the benefit to Fowler of Ms. Miller being appointed chairperson,” Mr. Paul’s lawsuit said. None of his allegations have been proven in court.

A spokesman for Mr. Graham has said he had no involvement in the management of Fowler.

Mr. Paul, who led DCC for 10 years, says in his lawsuit the dispute made him a target of Ms. Miller’s wrath and resulted in Ottawa’s decision to reject his application to serve a third five-year term as CEO in July of this year. His lawsuit seeks $1.5-million in damages from the government for allegedly “targeting [him] for removal … as a reprisal for pursuing the conflict-of-interest issue.”