The Speculative Narrative of the Duffy-Wright Affair

This is a blog concerning the Mike Duffy-Nigel Wright affair. Begun on June 22, 2013. (Revised on ____ __). Someone less lazy than I am will turn this into a book.

Basic information about the affair is available at: http://www.cbc.ca/news/politics/inside-politics-blog/2013/05/the-duffywright-affair-a-timeline.html

This blog entry provides a narrative of the Duffy-Wright affair that is focused on Nigel Wright's role and is SPECULATIVE. The narrative is based on (and does not contradict) any currently reported events [please advise of any needed corrections], but is also built on the following assumptions:
- Mike Duffy is in financial and perhaps general disarray
- The May 14th (approx.) leak of information to Fife of CTV news was made by Duffy;
- Wright did not provide a cheque directly to Duffy.
- Statements by the PM and PMO on this issue to date have been self-serving, incomplete and untruthful.

Speculative Narrative

February 2013

We know that by February of 2013 the over-charging of expenses by various Senators including Duffy had come to public notice by way of reporting in the news media. It is reported that Duffy and Prime Minister (PM) Harper discussed the matter in mid-February. At the end of February, it is reported Duffy is informed by Senator Tkachuk he owes $90,172.24. It is clear that the PM would see this issue as something to be handled to get it out of the headlines because it had negative political implications.  That the PM felt political heat in regard to Conservative Senators is evidenced by the that in the House of Commons the PM spoke to the issue of the expense claims of Senator Wallins on  ___ ___

March 2013

Sometime during March 2013 Duffy repays the Senate the $90,174.24.  The Prime Minister's Office (PMO) eventually states on May 15th that Duffy was able to make this payment because the PM's chief of staff Nigel Wright had provided Duffy with a private cheque in the amount of $90,000. 

First Question and Speculative answer: Did Nigel Wright make a personal payment to Mike Duffy as the PMO has stated?  Very likely "no".

Nigel Wright is a lawyer who was working as Chief of Staff to PM Harper in March of 2013. As Chief of Staff, it was his job to understand the legal and political boundaries of what could and could not be done in all sensitive matters and to keep the PM -- and the government generally -- on the proper side of those boundaries.  Given the optics, strict rules, and even criminal code implications of giving a large amount of money to a Senator, it is not believable that Wright simply wrote a cheque to Duffy. This would have been a profoundly stupid thing to do. Wright is universally credited with being intelligent and straight-laced. Furthermore, Wright made his mark as a young lawyer assisting in the creation of complicated financial transactions.(see:  http://www.theglobeandmail.com/news/national/who-is-nigel-wright-the-man-who-bailed-out-mike-duffy/article12005408/?page=all ) Therefore, assuming that the PM had told Wright to get this story out of the headlines and that Wright thought that the best (and most ethical) way to get the story out of the headlines was to have Duffy repay the money, and the problem was (apparently) that Duffy didn't have the money, Wright would have simply flipped out his chequebook? No, of course not: too crude, if nothing else (and there was plenty else).  Well, then, what did he do to get the money into Duffy hands?

We won't know the answer until the next government calls a public inquiry into this matter. But here is a speculative answer that fits with the known facts and subsequent behaviour of the parties. One answer to the entire problem was for Duffy to borrow the money to make the re-payment, but he may not have been able to do so. In response, Wright may have set up a trust account with himself (or another) as trustee and paid, or had others pay, into the trust the $90,000 amount.  The $90,000 payment, it is important to note, is not to Duffy. The obligations of the trustee under the trust would have been to (a) guarantee a loan that a bank was to provide to Duffy and pay off the loan if Duffy didn't/couldn't, and (b) when the loan was paid off, return the money to whomever had contributed it. (If something like this was done, the actual arrangements may have been far more complicated.)

If this, or something like it, was done, would it be ethical? While it is not as bad as paying the money directly to Duffy, it might still fall afoul of the ethics rules in the sense that Duffy would have been receiving an  in-direct benefit from the guarantee from the trust.  Presumably this explains why the arrangement with Duffy, whatever it was, to assist him to repay the Senate was kept secret.  The cover-up starts here.

Did the PM know about this arrangement? In some senses it doesn't matter, but the probability is high that he did. If he didn't know, then the eventual pubic inquiry will vindicate him on this point.

April 2013

In April, something went wrong with the arrangement made in March. Again, we won't know until the public inquiry is held what went wrong, but assuming that Duffy had taken a bank loan, he would have been expected to make the first payment in April. Suppose he started thinking along these lines, "Screw this - the party owes me big time. Big Time!  I'm struggling financially, partly because I did all this crap for the party. I've got lawyer's bills coming in. I'm going to have to pay more money back to the Senate. The party bank account is stuffed with money I helped raise!  The $90,000 is there! It is sitting there - Nigel, just pay off the bank loan with the $90,000 in trust and let me get my head back above water.".

If this was the situation, Wright would have tried to explain to Duffy that the trust was set up to avoid this very thing -- to avoid any direct benefit coming from him (or whoever else contributed money into the trust) to Duffy. Duffy, Wright would say, has to deal with this himself, he has to take personal responsibility. Wright may have had little sympathy for Duffy at this point. The whole situation was likely repellant to Wright.  Why, he may have thought, can't this political hack just take responsibility for what he has done and start making the payments he agreed to make!

At some point in April, things got really nasty. Duffy may have said, "Nigel, I'm not paying back the bank loan. I'm not. And if you don't play ball then I have a lot of friends in the news business. I know a lot of things that the media would love to report on."  Wright may have said, "That's blackmail Mike, you don't want to go there. Just pay the loan!"  Duffy could have replied, "Call it what you like." Wright may have thought, on reasonable grounds, that Duffy was bluffing. Who, he may have thought, would be so stupid to reveal a scandal that implicates themselves in wrong doing?

At the end of April then it is likely that a sort of Mexican stand-off had developed. Duffy refusing to pay the bank loan. Wright refusing to countenance black-mail.

May 2013

One real unknown in all this is Duffy's state of psychological stability in May of 2013. Whatever that mental state might have been, if seems Duffy concludes in early May that he is being badly treated by the prig Wright and the PM. He concludes his has to make good on his threat. He decides to contact Fife at CTV and tells him, around May 10th, that PMO helped him make the $90,000 payment. Fife eventually contacts the PMO about the story on May 15th.  At this point, the PM has a choice, to allow the truth to come out, or to concoct a replacement story.  That is, to enter into the 2nd and far more ethically dubious phase of the cover-up.

In dealing with this matter, the PM relied upon his past record of spin to allow himself to avoid the real choice.  His decision was duplicitous in his own mind. Shakespeare would have recognized it immediately. The PM thought it through this way. "Nigel will say he personally gave the money to Duffy to ensure that the Canadian taxpayer didn't suffer - the involvement of ____ in the trust cannot come out. We can spin this. Saving tax-payers money is consistent with our message as government all along. I will support Nigel on this, commend him even. We can turn this into a win!  Even if we take a bit of flack, we can ride this out. Eventually leak that sleaze we have on Trudeau, if we have to, although I was hoping to save it for the election campaign."

Wright at this point has a difficult decision. Can he insist to the PM that it is time for the truth to come out? After all, the truth will be damaging. In some sense, Wright realizes that he was responsible for allowing Duffy to get them all into this position.  He seems to have, possibly reluctantly, agreed to the surely false statement issued by his own office (but not by him) on May 15th that he had given a personal cheque to Mike Duffy. He may have thought: with the PM's support we can spin this out for a day or two. Another story will come along. The media/opposition can be diverted onto another story in a few days. After all, we have done that already many times. Why should it be different with this story?

This lie, however, has the effect of removing Nigel Wright's moral authority. And removes it from his own mind. Except for the 4 am-jog-interview, he has not spoken publicly since agreeing to the big lie.

The problem, however, didn't go away. It was, it seems, one scandal too many. Details were requested. The key detail: show us the cancelled cheque on Nigel Wright's bank account.  Since there never was such a cheque, it cannot be produced. The PM's untruthful narrative of events can only be sustained by silence. The cover-up grows and implicates the entire government. The big lie - that Nigel Wright acted alone and paid Duffy with a personal cheque - becomes official Government of Canada policy.

Eventually, Nigel Wright resigns. He makes no public statement at the time. On May 28th, during the 4 am-jog-interview he says, "I think I can stand behind my actions." His actions, if the above narrative is true, can be, to some degree supported. He can say, "my actions in dealing with Mike Duffy in March of 2013 had one objective only: to allow him to take personal responsibility for the over-charging of expenses to the Senate by paying them back. I thought that was the ethical thing to do. At the time, Duffy said he did too, but that he didn't have the financial resources. I didn't give him any money, but I helped him arrange a loan that he was to personally repay."

June

RCMP announce investigation. In response, Ethics Commissioner stops her investigation.

The cover-up continues with diversionary attacks.