FREDERICTON - Former New Brunswick premier Shawn Graham violated conflict of interest laws because of his involvement in his government's decision to award financial help to a construction company, the province's conflict of interest commissioner says.
Patrick Ryan released his report Monday into an allegation that Graham was in a conflict of interest when his Liberal government gave a $50 million loan guarantee nearly four years ago to Atcon, which is now defunct.
Ryan said Graham should have removed himself from cabinet discussions in March 2009 over the loan guarantee because his father, Alan, was a director of Vanerply — a Swedish subsidiary of Atcon — and a paid consultant of Vanerply and other Atcon companies.
Graham's involvement in the decision to provide the loan guarantee gave "the opportunity to further his father's private interest as a director, consultant and person on retainer," Ryan said in his report.
Ryan said while Graham didn't check whether his father had ties to the Miramichi-based firm at the time the loan guarantee was offered, it was his responsibility to know that.
"He chose not to know when he reasonably should have," Ryan said.
"A discreet inquiry by any representative on his behalf, at least, would have raised a red flag and he could have removed himself from any conflictual situation."
According to the report, Graham told the commissioner that he knew that his father and Atcon owner Robbie Tozer had known each other for years and that his father had been a director of Vanerply, but thought his father was no longer involved with the Atcon group.
Ryan is recommending Graham be fined $3,500 and reprimanded.
Under the Members' Conflict of Interest Act, it is up to the legislative assembly to decide whether to accept Ryan's recommendations, impose a different sanction or none at all. The legislature has 30 days from the start of the next session, which is March 26, to make that decision.
Graham declined to be interviewed but said in a statement that the conflict was an "oversight" on his part and he accepts full responsibility for his actions.
"I acknowledge that as premier, I had a lot on my plate at the time," said Graham.
"In hindsight, I should have checked to ensure there was no potential for anything to give rise to an allegation of conflict in relation to my participation in government decisions."
Graham is the first politician to be found in a conflict since the Conflict of Interest Commissioner's office was created in 2000, a spokeswoman for Ryan said.
Progressive Conservative Claude Williams, who filed the complaint while in Opposition in 2010 that launched Ryan's investigation, said the report backs up the concerns he had at the time.
But Williams said Graham should show more contrition.
"I'm a little bit disappointed in former premier Shawn Graham that in his statement he has not apologized to New Brunswickers," said Williams, now the province's transportation minister.
Williams declined to comment on whether he supports Ryan's recommended sanctions, saying he will leave that up to the legislature to decide.
Liberal Leader Brian Gallant said he is disappointed with the outcome of the commissioner's investigation, but glad the matter has been concluded.
He also declined to be interviewed but issued a statement saying more needs to be done to strengthen the provisions of the Act.
Ryan has also recommended a code of conduct for cabinet ministers and members.
New Democrat Leader Dominic Cardy is calling for a royal commission to investigate the government's handling of the Atcon file.
Atcon went bankrupt in 2010, a year after the loan guarantee was provided.
Graham was first elected to the legislature in 2003 and became premier in 2006.
His government was soundly defeated by a margin of 42-13 in the 2010 election and he resigned as party leader six weeks later, but continues to serve as the member for the riding of Kent.
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