Thursday, September 23, 2004

Shocking Adscam E-Mail Surfaces

Complaints over Groupaction work ignored
CTV.ca News Staff
Thu. Sep. 23 2004 8:31 AM ET

A five-year-old email is bringing the Quebec ad firm of Groupaction back into the spotlight at the sponsorship inquiry.
The inquiry heard Wednesday that in 1999, an email was written by a Treasury Board civil servant, who complained that Groupaction Marketing was charging "exorbitant amounts" for little or no work. "This is absurd," the email reads.
Despite the urgency of the complaint, nothing was done and Groupaction remained one the government's top ad agencies until 2003, when Ottawa finally cut its ties with the agency over fraud allegations.
The worker, Michael Calcott, then communications director for the board, also wrote that "surely there is a clause that allows us to terminate the contract for incompetence or unsatisfactory service." The email was directed to Public Works, the department that oversaw the hiring of advertising firms for the government.
"Not only do they charge exorbitant amounts for the work they do not perform, but the work they do perform is, at best, incompetent."
Another official at the Treasury Board also had problems with the way Groupaction charged for its services. Diletta Toneatti complained about the need to channel work through Groupaction rather than dealing directly with another ad agency.
Groupaction should not be paid a fee for acting as nothing more than a "courier service," wrote Toneatti. "I object to spending public funds needlessly," she said.
Paul Lauzon, a civil servant responsible for advertising at the Public Works Department, responded by urging Treasury Board officials to "use the agency at its fullest and benefit from its expertise in the development of ads."
Groupaction has been at the centre of the sponsorship scandal and an RCMP investigation. This year, police charged the company's president, Jean Brault, with six counts of fraud in relation to federal contracts worth $2-million. He's still awaiting trial.
A Globe and Mail report earlier this year said Groupaction was so tight with the Liberal government, it could make pitches to cabinet personally.

Text of the email presented at the inquiry:
From: Calcott, Michael
Sent: Wednesday, June 02, 1999 4:47 PM
To: Marcoux, Evelyn: PWGSC
Cc: Toneatti, Diletta; Schwatz, Jo-Ann
Subject: Groupaction
Importance: High
Sensitivity: Confidential
I was referred to your office on Monday and have been awaiting your call. I do not think this issue can wait any longer. Treasury Board Secretariat has had several dealing with Groupaction over the last three months and they have all been wretched experiences. Not only do they charge exorbitant amounts for the work they do not perform, but the work they do perform is, at best, incompetent. The President of the company wrote to say he was investigating and would get back to my predecessor. That was at least two months ago and I have heard nothing. Just this week, they attempted to charge $700 for concept work, even though we provided camera-ready material. This is absurd.
I am certain that TBS is not the only dissatisfied customer. My staff has had a great deal of difficulty getting basic information from your department on the terms of the contract with Groupaction. Surely there is a clause that allows us to terminate the contract for incompetence or unsatisfactory service.
Why is the Government of Canada continuing a major contract with an incompetent supplier? Could I please receive a copy of the contract with Groupaction. There must be an escape clause somewhere.
Michael