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Fri, June 20, 2003




Commish gets a break

Revenue Canada forgave $540G in debt on day before appointment
By GREG WESTON and PHILIP-LEE SHANOK -- Sun Media



ONE DAY before George Radwanski was given his $210,000-a-year patronage
appointment as Canada's privacy commissioner, Revenue Canada forgave
$540,000 he owed the federal government after years of not paying taxes,
according to documents obtained by the Sun. A longtime communications
consultant to Jean Chretien and other clients, Radwanski filed for
bankruptcy protection in 1999 with only one registered creditor -- the
federal tax department.
Documents indicate that on July 26, 2000, Revenue Canada wiped out
Radwanski's tax bills totalling $606,947 for only $67,726 in payments 
from
him.
The next day, Chretien appointed Radwanski privacy commissioner for a
seven-year term.
Chretien's senior adviser Eddie Goldenberg says neither he nor the prime
minister "knew anything about a bankruptcy" until the Sun called the 
PM's
office yesterday.
Radwanski told the Sun he had never mentioned his tax problems nor his
insolvency to anyone in government prior to his appointment as privacy
commissioner.
"I had some issues with Revenue Canada and they were resolved by mutual
agreement in a totally appropriate way. End of story," he said.
"This had absolutely nothing to do with any dealings with the government
(other than Revenue Canada) or anything else."
Chretien's appointment of Radwanski put the former deadbeat taxpayer in
charge of public funds totalling $11 million a year, and gave him access 
to
virtually unlimited expense accounts.
From a bankruptcy that cost taxpayers more than a half-million dollars,
Radwanski's life certainly changed for the better -- thanks to the same
Canadian taxpayers.
In less than three years since his appointment, Radwanski has collected
almost $600,000 in salary, $54,000 in rent for his Ottawa apartment, 
$93,000
in executive air trips home to Toronto on weekends, $290,000 in travel
expenses -- including 19 foreign trips -- more than $11,000 worth of 
wining
and dining at some of the fanciest restaurants in Ottawa and, of course, 
he
has a chauffeur.
A Commons committee investigating Radwanski is expected to call for his
resignation over his high-flying lifestyle on the public tab, and over
allegations he altered documents and lied to the committee.
But Radwanski's huge tax delinquency, and subsequent agreements with 
Revenue
Canada, are bound to shift the growing controversy to the circumstances
surrounding how he got his plum posting.
Documents show that Radwanski filed for personal bankruptcy protection 
on
Dec. 2, 1999, "primarily as a result of a decrease in earnings from his
consulting practice and non-filing of tax returns over a period of 
years."
He reported his only assets were a $255,000 house in Toronto, $3,000 in
furniture, $4,000 in RRSPs, and a 1984 Peugeot worth $500.
On the other side of the balance sheet, the TD Bank held a $205,000 
mortgage
on the house, and Revenue Canada was claiming "approximately $500,000" 
in
unpaid taxes.
GOT TO KEEP HOUSE
Radwanski said he was making about $11,000 a month from consulting 
contracts
with two clients.
There is no mention of any offer to become privacy commissioner in
insolvency documents.
At a meeting of creditors on Jan. 18, 2000, Revenue Canada agreed to 
wipe
out Radwanski's tax bills -- eventually listed as $557,436 -- for a 
payment
of $62,726.
Radwanski got to keep his house, and the government would eventually 
agree,
as part of his deal as privacy commissioner, to give him weekly,
executive-class, round-trip airfare between Ottawa and Toronto so he 
could
visit his home on weekends.
On Feb. 29, a notice was issued that Radwanski's deal with the tax
department would be presented to a Superior Court judge on April 11 for
approval.
But about the same time, Radwanski's name was apparently being 
officially
floated in Ottawa as the Liberal government's choice for privacy
commissioner.
Conservative Leader Peter MacKay, who was then his party's House leader,
later recalled in an interview that "people raised concerns then (in
February 2000), not just me," about the appointment reeking of 
patronage.
Radwanski said yesterday that as far as he was concerned, the insolvency
proceedings were over the day his deal with the taxman was approved in
January 2000, and had nothing to do with any discussions about his
subsequent appointment.
SECOND FILING
On March 24, 2000, at least a month after his nomination had been 
proposed
to the House leaders, Radwanski filed for a second bankruptcy 
protection,
this one for a company called 1131652 Ontario Inc., also known as
Synergetics Consulting Group Inc.
Like the first filing, this insolvency "was precipitated as a result of
certain tax liabilities" -- another $49,511 that Radwanski had failed to 
pay
to Revenue Canada.
On April 18, with Radwanski's corporate assets listed as zero, Revenue
Canada again agreed to wipe out the nearly $50,000 owing in back taxes 
--
this time for payment of only $5,000.
That deal was sealed by the courts in June of that year.
Finally, documents show Radwanski and his company had officially 
discharged
their debts to the tax department on July 26, 2000.
The next day, a cabinet order was issued, naming Radwanski as privacy
commissioner.
Radwanski then and now George Radwanski's lifestyle, then and now:
THEN: Projected monthly figures for January 2000*:
Income (after taxes): $7,250
Mortgage payment: $1,830
Insurance: (health, house, life, car) $1,000
Food: $700
Education expense: $650
Laundry/dry cleaning/toiletries: $200
Utilities, phone/cable: $700
Transportation (car, parking, taxis): $400
Clothing: $400
Household upkeep: $400
Entertainment/Miscellaneous: $250
* figures obtained from court documents prepared in accordance with the
Bankruptcy and Insolvency Act
NOW**:
Monthly income (before taxes): $18,000 (based on annual salary of 
$216,600,
plus perks)
Second residency allowance (after tax): $1,200 (paid by taxpayers by 
special
secret deal with Privy Council Office)
Transportation: Chauffeured car
Lunch: $210 at Ottawa's Ritz 3 restaurant
Dinner: $444 at La Panache, Hull
Travel for 2001: $110,042
Travel for 2002: $177,040
Hospitality costs for 2002: $7,186
Tuxedo rentals for 2002: $400 for two nights
Weekly flight home to Toronto from Ottawa: About $1,000 (paid by 
taxpayers
by special secret deal with Privy Council Office)
Ten-day trip to London and Cardiff for conference and speaking 
engagements:
$16,327