National Newswatch

OTTAWA - The $90,000 from Stephen Harper's former chief of staff wasn't the only secret, five-figure payment made on Mike Duffy's behalf during the Senate expense scandal, the senator at the heart of the controversy says.

For the second time in as many weeks, Duffy — expelled from the Conservative caucus in May — shocked the normally sleepy upper chamber Monday with a tale of intrigue and betrayal he says starts and ends with the Prime Minister's Office.

"The cheques tell who's telling the truth and who is not," Duffy, a former TV broadcaster, declared before releasing more documents to buttress his explosive claims.

At issue is an alleged coverup in which the Prime Minister's Office paid off Duffy so that he could repay disputed expenses, in return for which a Conservative-dominated Senate audit committee would whitewash Duffy's behaviour and make the scandal disappear.

Instead, the flames just keep getting higher — and on Monday, Duffy poured more fuel on the inferno.

Facing suspension without pay for the next two years, Duffy and fellow Conservative exiles Pamela Wallin and Patrick Brazeau have all lashed out at a PMO they say is railroading them out of political expediency.

Duffy tabled a document with the Senate that shows Arthur Hamilton, the Conservative party lawyer, signed off on a payment of $13,560 to Duffy's legal representative last April 3.

Duffy says he'd already been "coaxed" into accepting $90,000 from Nigel Wright, Harper's chief of staff, to be used to pay off disputed Senate housing expense claims — notwithstanding written assurances from Wright that he'd broken no rules.

"It was never about ethics, it was always all about politics — which explains why Arthur Hamilton was busy cutting cheques," Duffy charged.

Repaying expenses he'd been cleared to claim would make him look guilty, said Duffy.

"But when I insisted on written guarantees that repaying money I didn't owe would not be seen by the Senate as a guilty plea, Nigel Wright arranged to have my legal fees paid," he told a rapt upper chamber.

"That's right. One cheque from Nigel Wright? No, ladies and gentlemen, there were two cheques — at least two cheques."

An audible gasp went up from the gathered senators.

Hamilton, who works for the firm Cassels Brock & Blackwell, would not comment on any of Duffy's claims when reached by The Canadian Press.

The Prime Minister's Office issued a statement reiterating that Wright has "assumed sole responsibility for his actions."

"The prime minister was not aware of the arrangement and had it been presented to him he would not have approved of such a scheme," said spokesman Jason MacDonald.

It was the revelation last May that Wright himself paid off Duffy's expenses that brought the Senate scandal to the prime minister's front door.

Harper has steadfastly maintained he knew nothing of Wright's largesse, but the circle of PMO and party insiders who were in on the deal appears to keep growing.

And Duffy keeps fanning the flames.

"I've never seen a cheque from Nigel Wright," Duffy noted, almost as an aside Monday.

"But I do have the cheque stub and transmittal letter from Arthur Hamilton, the Conservative party's lawyer."

Duffy alleged the funds for his legal fees came from the Conservative party and thus from the pockets of the same party donors that the PMO was attempting to dupe and placate.

A party spokesman appeared confirm Duffy's suspicion on the source of the funds.

"At the time these legal expenses were incurred and paid, Mike Duffy was a member of the Conservative caucus," Cory Hann said in an email.

"The Conservative party sometimes assists members of caucus with legal expenses."

Duffy laid the blame directly on Harper.

"This was all part of his strategy, negotiated by his lawyers and the Conservative party's lawyers, to make a political situation embarrassing to his base go away," said Duffy.

Even the story Duffy first offered the public last February about how he'd borrowed the money to repay his expenses was cooked up by the PMO, the senator says — and he claims to have the email to prove it.

Duffy said the PMO "rehearsed with me, right up until minutes before I went on television, the lines I would use in the media."

The prime minister in the Commons last week used Duffy's claim of remortgaging his own home as proof that the senator's words could not be trusted: "When Mr. Duffy went on national television (last March) to say that he had repaid his own expenses by taking out a loan against his assets, that is exactly what he should have done," Harper said in the House.

According to Duffy, "the PMO told me to say that my wife and I took out a loan at the Royal Bank."

"That line was written by the PMO to deceive Canadians as to the real source of the $90,000," he asserted.

And he says he was well within the rules in filing his expenses, and that the true amount of claims that were found to be improperly filed totalled less than $500.

The Senate continued to debate a motion Monday evening to suspend Duffy, Wallin and Brazeau without pay for two years, although the sanction is meeting fierce resistance from some Conservatives who feel it fails to give the three due process.

The Canadian Press
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