City Attorneys Call for $ 1.2 Million More to Pursue Possible $ 24 Million in Winnipeg Police Headquarters Fraud Case – Winnipeg | The Canadian News

The City of Winnipeg legal team has requested an additional $ 1.2 million to hire help to navigate the “massive volume” of paperwork surrounding the Winnipeg City Police Headquarters fraud case.

The team also alleges that there may be up to $ 24 million in fraudulent activity surrounding the case.

The city filed a statement of claim and a notice of motion in January 2020, indicting a large number of individuals and businesses in connection with the construction of the new Winnipeg Police Service headquarters.

The city alleged that the contractors behind the company, Caspian Construction, along with dozens of others, including former CAO Phil Sheegl, organized a broad conspiracy to inflate prices and quotes and ultimately increase the cost of the project.

Sheegl and Caspian Construction have denied all allegations. None of the accusations have been proven in court.

While the city is seeking about $ 700,000 in damages from Sheegl alone, the city’s Director of Legal Services Doug Brown said Tuesday that they believe the city was defrauded of up to $ 24 million, if not more.

“That’s an amazing starting point, frankly, from which I can accurately tell you that the number has increased significantly.

“I can’t give you a final number at this point, but that number has certainly increased significantly.”

Brown said the team does not anticipate needing more money to go through the accounting and discovery process.

According to the report, the city decided to sue after an initial review “identified more than $ 20 million claims from contractors and subcontractors related to the Project that are not clearly documented or accounted for.”

“The legal and forensic work completed to date has identified a serious pattern of possible misconduct consistent with the allegations made in the City’s Statement of Claim. These matters require further forensic and legal reviews. “

The report says that after the initial fraud claim statement, the attorneys uncovered new information that “suggests that the City paid more than $ 24 million to Caspian… in connection with invoices from Fabca Projects Ltd. (“ Fabca ”). These bills were variously described as related to demolition, asbestos remediation and other matters. “

“None of the work described in the invoices was carried out by Fabca. Apparently none of the $ 24 million was ultimately paid to Fabca. “

Fabca was initially part of the city’s civil lawsuit, but the city filed a stay notice against him last year.

The legal team said that if one or more of the defendants in the civil case were found liable for fraud surrounding the construction of the WPS headquarters, a judge would likely award the costs to the city, recovering legal fees.

However, that is not guaranteed, Coun. Brian Mayes pointed out.

The city has already spent $ 2.85 million on outside attorneys and forensic accounting, according to the report.

The EPC approved the motion unanimously and it will now go to the council for approval.

The RCMP launched an investigation into the matter in 2014 at the request of the province.

That investigation cooled down in December 2019 when Manitoba Justice said it would not press charges due to lack of evidence.

Despite that, the city went ahead with a civil case against Sheegl, Caspian Construction and others, as it is easier to prove a case in civil court than in criminal court.

“The first is the burden of proof in a criminal case,” University of Manitoba law professor Karen Busby said last year.

“You have to prove it beyond a reasonable doubt. Whereas in a civil case, you only have to prove it on a balance of probabilities. That is number one.

“No. 2, in a criminal case, the defendants have the right to silence. They don’t have to cooperate. They don’t have to say anything. But in a civil case, they do. And they have to produce documents on demand.

“And then thirdly, there could be differences in what exactly needs to be proven in terms of the elements of the alleged infringement. So, you know, the standard of a fiduciary and for a criminal charge might be different than the standard of a fiduciary for a civil charge. “