Loophole tears lid off donations

by DANIEL LEBLANC — August 1, 2007

Any Canadian could exceed by more than $60,000 the legal donation to a political party under a loophole discovered by The Globe and Mail.Elections Canada confirmed yesterday that an individual could theoretically contribute $199.99 to each of the party's 308 riding associations across the country - a total of $61,596.92 - without attracting anyone's attention.OTTAWA -- Any Canadian could exceed by more than $60,000 the legal donation to a political party under a loophole discovered by The Globe and Mail.

Elections Canada confirmed yesterday that an individual could theoretically contribute $199.99 to each of the party's 308 riding associations across the country - a total of $61,596.92 - without attracting anyone's attention.

That's because parties are required to inform Elections Canada only of individual donations of $200 or more. Smaller donations to riding associations are lumped together, with no breakdown for cross-checking.

Under the government's showpiece Accountability Act, passed last year, individuals can donate a maximum of $1,100 to a political party.

John Enright, a spokesman for Elections Canada, said the agency cannot keep track of donations below $200 because "we do not get the receipts" from the individual riding associations.

Asked whether people are using the loophole to cheat, Mr. Enright could not give an answer yesterday.

Government officials also acknowledged that the Elections Act suffers from "a deficiency," but refused to say whether any action will be taken in the short term to close the contribution loophole.

"We have laws in place, but at the same time, you hope that people obey these laws. If they don't, you have to obviously have mechanisms in place to ensure that the laws are enforced," an official said.

Mr. Enright also insisted that making donations beyond the maximum limit remains illegal.

"Anybody who gives over and beyond [the limit] is breaking the spirit and the letter of the Canada Elections Act," he said.

Mr. Enright said that riding associations must keep the receipts they issue for all donations over $20 and would have to provide them to Elections Canada in the event of an investigation into a donor's activities.

When he unveiled the Accountability Act last year, Prime Minister Stephen Harper said its goal was to rid politics of scandals. "We must clean up corruption and lift up the veils of secrecy that have allowed it to flourish," Mr. Harper said, promising to "replace the culture of entitlement with a culture of accountability."

Former Liberal cabinet minister Don Boudria, who introduced changes to Canada's electoral law in the Chrétien government, said there were fewer problems when the maximum annual contribution to a party was $5,000.

He blamed the Conservatives for tempting people to bypass the law with the "absurdly low" maximum donation of $1,100, which took effect Jan. 1.

He accused the Conservatives of creating "badly thought-out legislation that doesn't include the required checks and balances to manage it appropriately."

The Globe discovered the loophole while examining political donations made by Conservative MPs last year.

Conservative MP Lee Richardson did not show up as a donor to the Conservative Party on Elections Canada's databases.

But Mr. Richardson insisted he gave more than $200 to the Conservative Party last year. After checking his records, Mr. Richardson found that he gave cheques of less than $200 each to at least three riding associations, while making sure that he stayed below the maximum of $1,100.

While he obeyed the law, Mr. Richardson's case showed that someone can make multiple donations to a political party without coming up on anyone's radar screen, including at Elections Canada.

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Elections Act in brief

Individuals may donate up to $1,100 a year to:

Each registered political party;

The various entities of each registered political party (registered riding associations, nomination contestants and candidates);

Each independent candidate for a particular election;

The leadership contestants in a particular leadership race.

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HIGHEST AND LOWEST DONATIONS

Seventy-six of the 125 Conservative MPs gave less than $200 - and possibly nothing

at all - to the party in 2006, according to Elections Canada. The top six contributors were:

$2,500 James Moore, MP for Port Moody-Westwood-Port Coquitlam, B.C.

$1,853 Pierre Poilievre, MP for Nepean-Carleton, Ont.

$1,342 Prime Minister Stephen Harper

$1,320 Treasury Board President Vic Toews

$1,275 Maurice Vellacott, MP for Saskatoon-Wanuskewin

Any Canadian could exceed by more than $60,000 the legal donation to a political party under a loophole discovered by The Globe and Mail.Elections Canada confirmed yesterday that an individual could theoretically contribute $199.99 to each of the party's 308 riding associations across the country - a total of $61,596.92 - without attracting anyone's attention.

Source:The Globe and Mail