Meet Calgary’s top corporate corruption lawyer
Posted on June 19, 2013 | By admin | Leave a response
Kristine Robidoux tried to get out of the game. She slipped out the back door of Calgary’s old courthouse once, dodging reporters and their questions about an unsavory character the lawyer was defending. When Robidoux got back to her office, still wearing her robes, she put her head in her hands. “This is a hard way to make a living,” she thought. “I’m not sure how many years of this I have in me.”
And then, with her head still cradled in her hands, her phone rang. Superior Propane wanted to know if the lifelong criminal defense lawyer would be interested in joining its corporate team. Executives spotted Robidoux on the news one night and reckoned if she could defend Calgary’s nasty criminals, she could stick up for the propane industry. Robidoux could put bank robbers behind her.
Kristine Robidoux has acted for companies involved in two of Canada’s largest bribery cases
Photograph John Gaucher
She jumped, believing her harried days as a criminal lawyer would fade. Robidoux, however, made a mistake. Superior Propane may have rescued her from the courtroom in 1997, but it put her on track to becoming one of Canada’s top corporate corruption lawyers – a role that once again has her standing in front of federal judges, arguing criminal cases. Indeed, Robidoux has been the legal face of Canada’s two largest bribery cases: Niko Resources Ltd. in June 2011 and Griffiths Energy International Inc. this year. But Robidoux’s job, along with her competitors, is about more than dissecting bribes and shady backroom deals. Canada’s reputation is on the line.
Up until 1986, Canadian companies could deduct international bribery payments from their taxes. The government even provided an information circular detailing the requirements. Meanwhile, American outfits have been subject to the Foreign Corrupt Practices Act (FCPA) since 1977. “It was a burden on American business that their competitors did not have to face,” Milos Barutciski, co-head of Bennett Jones’ international trade practice, says. American companies, tired of watching others literally steal business from them, pushed Washington to fix the imbalance.
The U.S., in turn, pressured the Organisation for Economic Co-operation and Development to develop anti-corruption rules. The world’s richest governments did just that, but not without resistance. Canada signed the OECD’s anti-bribery convention in late 1997, and the country’s Corruption of Foreign Public Officials Act came into force in early 1999. With anti-corruption laws in place, Canada returned to ignoring corruption.
Robidoux, however, was paying attention. She left Superior Propane for Enmax Corp., where she was even more focused on compliance. In 2004, with Canada still sitting on the sidelines while American prosecutors pursued corruption cases, Robidoux set up her own advisory business – ComplianceWorks.
The niche firm zoomed in on business ethics, governance and compliance. She was, essentially, a management consultant with a law degree. “I saw that in the United States, enforcement of the FCPA was rapidly increasing,” she says. “Boards of U.S.-listed companies were starting to really take this seriously. I knew that Canada had legislation, but it was not at that point really being enforced. But I believed that what we were seeing in the United States was going to trickle north.”
This risk was amplified in Calgary, where oil and gas companies operating in less developed countries routinely paid bribes without blinking, believing it impossible to do business without greasing the palms of foreign officials. “It was only a matter of time before Canadian companies, subject only to the Canadian statute, would start to take this seriously,”Robidoux says.
ComplianceWorks allowed the bilingual lawyer to exercise both sides of her brain, blending her litigation background with her skills as a solicitor. The transnational nature of the business appealed to the Université de Moncton graduate, and so did the risk game.
Robidoux’s husband, however, was losing patience. ComplianceWorks was largely his idea – again, part of the elusive hunt for a balance between working and playing as their kids turned two and four – and it backfired. “From a work-life balance perspective, Compliance was just an abject failure,” Robidoux says. “[Business] went from zero to 100 in no time flat.”
Her husband, himself a lawyer, came to their kitchen table with evidence: a calendar. Robidoux had worked 38 days straight. “He looked at me and said to me in a way that sounded almost like an accusation at the time: ‘You like to work. You should just join a large firm. A national firm,’” she recalls.
“I remember looking at him like he had three heads. I said: ‘You don’t know me at all. I would hate that. I’ve spent essentially my entire career avoiding the big firm.’”
The OECD issues report cards as part of its effort to curb foreign bribery schemes. Over the years, Canada has not impressed.
Without any convictions, prosecutions, investigations or a dedicated team of law enforcement officials assigned to dealing with corruption, Canada was shamed in the OECD’s first two reports. Even after Canada racked up its first anti-corruption conviction against Red Deer energy services company Hydro Kleen Group Inc., the OECD was still disappointed in Canada’s commitment to stamp out corruption. “The absence of more cases is surprising given the extent of Canada’s international economic engagement,” a report issued by the OECD in June 2006 said.
While the Hydro Kleen conviction may have officially counted as a win, it also demonstrated Canada’s soft approach to the global push to end corruption. Hydro Kleen bribed a U.S. immigration officer to delay employees working for a competitor as they passed through the Calgary International Airport on the way to meetings. The company pled guilty and paid a fine equal to its $25,000 bribe.
“It showed the government hadn’t quite grasped the relevance of the Corruption of Foreign Public Officials Act and what was required of it by the OECD convention,” says Riyaz Dattu, a partner at Osler, Hoskin Harcourt LLP in Toronto with a focus on anti-corruption and financial crimes. The fine was flimsy and it was not the kind of case the OECD hoped would be filling dockets.
The RCMP, experts say, now has about 35 investigations underway, which should improve Canada’s standing in the OECD’s next assessment. Moreover, the country is two-for-two on convictions since it set up its specialized RCMP team. And Robidoux’s fingerprints are all over them.
After years of pretending she could balance her lawyerly duties with her family life, Robidoux negotiated a compromise with herself: she outsources every “non-essential” task in her life, from Christmas shopping and wrapping to cooking Thanksgiving dinner, in exchange for accepting that the results may not always be up to her standards. This definition of balance came after Robidoux conceded her husband was right – she needed to be at a big law firm. She ended up at Gowling Lafleur Henderson LLP in 2008.
The national firm gave Robidoux a long leash, building its business integrity practice group to her specs. She defended Niko Resources, Canada’s first corruption case after it established the specialized RCMP unit, when it pled guilty to bribing Bangladesh’s junior energy minister in 2005. The bribe came in the form of a luxury SUV and trips to North America and was worth about $200,000. The punishment came in the form of a $9.5-million fine, and plenty of bad press.
Niko Resources may count as Canada’s first real corruption case, but it is the Griffiths Energy bribery affair that experts say will shape the country’s approach to corruption – as well as influence the OECD’s opinion of Canada’s progress.
Griffiths Energy, which holds oil leases in Chad, came to Gowlings in the fall of 2011 after discovering unusual consulting agreements when it was preparing paperwork to go public. The irregular agreements, however, were discovered by a new slate of managers and directors after one of the company’s co-founders, Bay Street financier Brad Griffiths, died in a boating accident. Co-founders Naeem and Parvez Tyab had also left the firm by the time the questionable contracts surfaced.
Robidoux and her team responded by grilling her own client. She convinced Griffiths Energy’s new leaders to disclose their discovery to authorities in Canada and the U.S., and conduct its own forensic audit. Robidoux and her team concluded Griffiths Energy paid US$2 million to the wife of Chad’s ambassador to Canada at the time, Mahamoud Adam Bechir, and gave his wife and her associates the chance to buy lucrative “founders’ shares” in the company for a fraction of a penny each, in its effort to secure energy properties in Chad. Griffiths Energy pled guilty to the bribe in January. It settled for $10.35 million.
While Griffiths Energy’s slate is clean, and it is now preparing a public offering and changing its name to Caracal Energy Inc., the investigation continues and prosecutors are trying to recover the founders’ shares and the $2 million.
Meanwhile, the federal government has put forward amendments to Canada’s Corruption of Foreign Public Officials Act, hoping to close a loophole on jurisdiction, increase potential jail terms to 14 years from five, and make it easier for prosecutors to go after companies and executives when they disguise bribes or fail to record payments. This is another step towards stamping out foreign corruption, although Robidoux says educating the oil patch about the issue is also important. “Canada will never achieve its goal of eradicating foreign bribery through enforcement alone. Education is crucial.” she says.
While the amendments will strengthen Canada’s laws, Griffiths Energy provides a key precedent. “The integrity and courage demonstrated by the new team at Griffiths will be the standard against which other companies may be measured,” Robidoux says. “The RCMP said they demonstrated the gold standard for co-operation. They were praised by Justice [Scott] Brooker in his decision for demonstrating genuine remorse. And I think that will bethe legacy.”