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Harper changes story on staff's Duffy dealings

Canadian Press logoCanadian Press 2015-08-14 Jennifer Ditchburn

OTTAWA — Conservative Leader Stephen Harper now says the "vast majority" of his staff didn't know about a plan to fake Mike Duffy's personal repayment of Senate expenses, changing his position that only a single person was aware.

The focus on Harper's office and who was involved in negotiating the repayment scheme, is expected to intensify as more witnesses testify in Duffy's fraud, breach of trust and bribery trial.

In early June 2013, weeks after it was revealed that Harper's then-chief of staff Nigel Wright repaid the $90,000, Harper emphasized to the House of Commons that it was Wright's doing.

"Those were his decisions," Harper said. "They were not communicated to me or to members of my office."

Then-cabinet minister James Moore told the Commons that Wright "acted alone."

But Justice Charles Vaillancourt has heard testimony from Wright and seen hundreds of emails, that place a half dozen staff and party brass in the know.

One of those told about Wright's plan to repay was Ray Novak, Harper's current chief of staff and a senior campaign director. Novak is arguably the closest person in the party or the government to Harper. He's not just a staff member, but also a friend and confidante.

On Thursday, Harper backed Novak's claim that he did not read the direct email from Wright — then his boss — and didn't know about Wright's payment.

"We were all told, we were all told that Mr. Duffy had repaid his expenses ... that's not only what the entire caucus thought and I thought, that is what the vast majority of our staff also believed was the case," Harper told reporters in Hay River, NWT.

The trial is likely to become even more sticky for the Conservative campaign, as two key lawyers are expected to testify on the negotiations inside Harper's office around repayment of the senator's expenses.

Janice Payne, Duffy's lawyer in 2013, and Benjamin Perrin, then a PMO lawyer, are expected to be defence and Crown witnesses respectively.

Both took part in a March 22, 2013 conference call with Novak and Wright. Conservative spokesman Kory Teneycke said Novak was on the first part of the call, but didn't hear discussion of Wright's cheque.

Teneycke could not comment on what Novak did hear during the call — a blank that defence attorney Donald Bayne is likely to try to fill if and when Payne and Perrin testify.

A day after the conference call, Wright wrote to Novak and Perrin directly: "I think her approach works. I will send my cheque on Monday."

Three days later, Wright sent the cheque to Payne's office.

Novak and others weren't just told about Wright's decision to repay the $90,000, they were also told about a plan a month earlier to have the party pay for both Payne's legal bills and Duffy's expenses.

In an email Wright sent to Novak on Feb. 22, Wright directs Novak to read a chain of emails on negotiations with Payne, calling it the "state of play."

"We are ready to move when we hear back from his lawyer," Wright tells Novak.

One element of that "state of play," copied to Novak, contains Wright's comment that "the party is open to keeping Sen. Duffy whole since it is clear that any overpayments were innocently received. I have a call into the party to confirm this, as I think that the senator has a right to have it confirmed."

Duffy's lawyer pointedly raised Novak's name during the proceedings on Friday. He has referred to Novak as a "conduit" to Harper.

"He's not there for plausible deniability...he's not there for that?" Bayne asked.

Wright responded: "Ray ... was the No. 2 person, senior member in the PMO and he's entitled to know what's going on."

Stephen Lecce, another member of Harper's current campaign team, was also copied on those points of negotiation. Later, Lecce helped draft the media lines that Duffy would use when telling the public it was he (not the party or Wright) who would repay his expenses.

Lecce did not respond to a request for comment.

Another figure who appears in the email exchanges is party lawyer Arthur Hamilton, who Payne emails in March 2013 to inquire about "when we can expect to be in funds.

The Conservative financial fund chief Sen. Irving Gerstein was consulted by Wright on having the party pay for Duffy's expenses when they were first estimated at $32,000.

"These are the actions of Mr. Duffy and Mr. Wright. You hold people responsible for their own actions, you certainly don't hold subordinates responsible for the actions of their superiors," Harper told reporters Friday.

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