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Toronto Star November 9, 2000,  - by Tony Van Alphen, Business Reporter

Ontario Realty arm corruption claims grow
Suit alleges bribery, bid-rigging and fraud

The Ontario government's real estate arm says it has uncovered a widening web of bribery, bid-rigging, fraudulent land sales, phony environmental tests and incomplete site clean-ups involving its own staff and outside companies.

Ontario Realty Corp. (ORC) submitted a new revised claim in court this week that provides more details of previous allegations of misconduct and adds numerous other cases where staff and other parties allegedly colluded in deals that defrauded the government and taxpayers. The civil claim now seeks $41 million in damages from 40 defendants, including the Vaughan-based Gabriele group of companies, firms associated with Oshawa consultant Ivan Sirman and five former ORC employees.

One of those employees was a former real estate officer at the agency who moved to a comparable position at the transportation ministry in November, 1999. The claim identifies him only as John Doe No. 1.

In its original claim in April, the realty corporation, which manages and sells Ontario's real estate, named 23 defendants.

Police, who are also investigating, have not laid criminal charges in the controversy, which erupted earlier this year and caused headaches for the Harris government.

The latest allegations, which have not been proven in court, range from 11 examples of allegedly selling land to Gabriele-related companies at below-market prices to a new case where an ORC employee allegedly received a $5,000 bribe.

None of the defendants has yet filed a statement of defence. News of the allegations raised concerns among some Toronto residents about the environmental safety of former government land that a Gabriele company did not clean up properly before building 34 duplexes on it, the ORC has said.

The claim says the cancer-causing contaminant benzo(a)pyrene still exists in amounts exceeding environment ministry guidelines on 1.4 hectares in a Bronoco Ave.-Rogers Rd. neighbourhood.

Earlier, an environmental consultant acknowledged in a letter to residents that benzo(a)pyrene surpassed guidelines but added ``there are no anticipated adverse effects upon human health.''

Margarita Reis, who lives in the neighbourhood, said she felt scared in view of what the consultant stated.

In addition to alleged incidents of selling land at ``false'' prices, the agency's claim outlines seven alleged instances of bid-rigging, five allegations of phony bids, five of falsified environmental tests and two of bribes.

ORC alleges Sirman Associates submitted fraudulent test reports in the area's cleanup in 1997. Sirman also allegedly used an engineering firm's letterhead in a ``cut and paste'' scheme to falsely represent that the firm was a consultant on the property.

The claim adds that in late 1997 and in 1998, former ORC environmental co-ordinator Ross Farewell (who has since been fired) received ``secret payments from Sirman Associates.

ORC's claim also provided more details on alleged price concessions on land sales to Gabriele firms involving Vince Catalfo, the ORC's manager of institutional and environmental services until November last year. Catalfo has declined comment about the allegations on the advice of his lawyer.


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