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the battle for supremacy among City Hall lobbyists is all but over for Jeffrey Lyons, thanks to a civic election financing scandal that’s the talk of the town. It was revealed last week that an employee of Lyons’s was allegedly instructed to write cheques for a bevy of municipal candidates in contravention of fundraising rules.
How did this affair make it to the front pages? It would appear that one of Lyons’s chief competitors in the cutthroat world of municipal influence-peddling actually had a big hand in firing the arrow that pierced the deal-maker’s once impenetrable armour.
The missile left the bow almost a year ago, when an article detailing the source of campaign contributions appeared in a subscription publication called Novae Res Urbis. The front-page report advised that financial statements filed with the city clerk indicated that “nearly half of the successful candidates” for Toronto council in 2000 received money from current and former employees of the legal firm Morrison Brown Sosnovitch. The law office just so happens to be where Lyons — who’s also a lawyer — used to hang his corporate chapeau.
NRU went on to document “nearly $9,000 in donations to 18 candidates by a Susan or Sue Cross, a former government relations consultant working for Lyons.” The story said the names of Cross and Navjeet Mangat (another Lyons employee who contributed $9,150 to 13 successful council candidates) “stood out because of the frequency with which they appeared on the lists and because of the amounts they donated.”
Most of these contributions were for between $500 and $750, the legal limit set for individual donors.
The article then quoted a city elections official who advised that “a person can only give money that belongs to them.” In other words, they’re barred from giving on behalf of someone else. The implication was pretty clear.
This brings us to Bruce Davis. His name is being mentioned a lot right now because he’s been competing with Lyons for clients ever since amalgamation turned the new city of Toronto into a fiscal fondue party where everybody’s fighting to get a fork in the pot.
Although Davis’s name doesn’t appear on the NRU masthead, it’s no secret he’s a partner in Urban Intelligence, the municipal consulting firm that publishes the newsletter 50 times a year. Many council members pay the $269 subscription fee. And why not? Davis, who got himself elected to the public school board two years ago, has lent considerable support, both financial and strategic, to numerous ballot-box clashes.
Indeed, deputy mayor Case Ootes and recently elected councillor Michael Tziretas have him to thank that former school board chair Gail Nyberg was twice denied a seat in the council chamber. Like Lyons, Davis boasts a close association with Mayor Mel Lastman and many of the chief magistrate’s key council allies. But Lyons was long considered the master of influencing the municipal decision-makers.
About this time last year, Sue Cross was out of work but preparing to start a new job as executive assistant to councillor Jane Pitfield. Cross saw the NRU story and immediately realized she was in something of a professional predicament. She alerted Pitfield to the problem, and it was the councillor who asked that Cross swear an affidavit outlining the role she played in distributing other people’s money to various campaign kitties.
According to that affidavit, sworn June 20, 2001, Cross was ignorant of the requirements of the Municipal Elections Act with respect to campaign contributions. But she trusted that Lyons (a lawyer, don’t forget) knew the rules and would never counsel her to do anything illegal.
Cross said she deposited a $15,000 cheque from one of Lyons’s many clients into her personal bank account. Then, again on the alleged instructions of Lyons, she wrote 28 cheques “to individuals running for municipal office.”
“In each case, I would write the cheque, pursuant to Mr. Lyons’s instructions, and give it to him,” Cross stated under oath. “He would write a covering letter and forward the cheque, often with cheques from other contributors, to the candidate.”
Last week a copy of the affidavit came into the possession of a Toronto Star reporter. And this week all anyone wants to talk about at City Hall is how far the once mighty Lyons has fallen and what an investigation of this alleged money-laundering scheme might reveal about the you-scratch-my-back-I’ll-scratch-yours relationship between politicians and big business.
Meanwhile, Bruce Davis is in London, England, where Urban Intelligence has expanded its growing consulting business. He couldn’t be reached for comment, but the Brits are no doubt wondering if all Canadians always sport such enormous smiles.
Many councillors say they can’t believe Lyons could be so stupid as to do what has been alleged. And, in spite of a letter he sent to one politician informing him of contributions made in the names of Cross, Mangat and others, the lobbyist has denied any wrongdoing. Lyons cannot be reached for comment, but he has insisted publicly that everything comes down to his word against that of his former employee. And he may be right.
But that’s exactly the kind of arrogance that has landed Lyons in trouble, says councillor Michael Walker. The rules governing election campaign financing have become so perverted, council’s resident iconoclast argues, that the likes of Lyons don’t even concern themselves with appearances any more.
Everybody knows the lobbyists represent corporate interests that want to do business with the city. Everybody knows those companies are pumping money into the campaigns of chosen candidates with the expectation of a benefit somewhere down the road. But too few councillors are prepared to do anything to change the system, because that might loosen their grip on political power.
“I’m fed up. I’m really disillusioned,” Walker laments. “It’s all about big money, big business and special interests. We as individual citizens no longer have any say in how the city is being run. We’re being played for suckers.”
For weeks now, Walker has been shopping around a report his office prepared on the critical need for election finance reform. Unfortunately, most of his colleagues went out of their way to ignore the tome until the Lyons spit hit the fan. Now, all of a sudden, the matter is headed to committee for consideration.
But we’ve all been down this road before, and nothing has changed except for the level of disregard being shown to the rules. As Walker is quick to point out, successful council candidates got 60 per cent of their donations from corporations in 2000. Some received more than 80 per cent of their campaign war chests from business interests. In one case, that share hit 90 per cent.
At the same time, many candidates committed more money to fundraising activities than they could legally spend on an entire election campaign. That’s allowable under the loose rules. In fact, some councillors raised so much cash (up to three times the limit in at least 10 cases) that they’ve got money salted away for campaigns well into the 21st century.
“It makes it extremely difficult for anyone from the outside to get onto council,” Walker says.
Yet Lyons may be worse off now when it comes to being welcomed at City Hall. In the past several years he’s been linked to some of the most highly charged issues council has had to deal with. The Adams Mine dump disaster and the MFP computer leasing scandal come immediately to mind. Now this.
There was a time when many councillors addressed Lyons as Brother Jeff. These days they just call him a bother. And that’s not good for business.
Not his, anyway.
