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Grain industry abuzz over ‘conflict of interest’ ruling of former CGC chief

Jim Smolik’s lawyer unsuccessfully argued there was no breach because there was no evidence he improperly took advantage of his former CGC office

Many people in Western Canada’s relatively small and collegial grain industry are puzzled how Jim Smolik ended up contravening Sections, 33 and 32(5), of the Conflict of Interest Act.

A report prepared by the Office of the Conflict of Interest and Ethics Commissioner lays it all out. But according to several industry sources Smolik, a former Canadian Grain Commission (CGC) assistant chief and acting chief commissioner, could have avoided the breaches by simply not getting directly involved in his new employer Cargill’s efforts to get a CGC exemption so it could use mineral oil to suppress grain dust at its grain terminal in Sarnia, Ont.

There was no reason Cargill couldn’t ask for the exemption, but the Conflict of Interest Act restricts what former public office holders, such as Smolik, can do.

They posit Smolik could have guided other Cargill staff on how to engage the CGC. That arguably could still contravene the rules, but would be less likely to trigger an investigation.

Smolik isn’t commenting, but some of his friends complain the act is too broad and needs to be better defined.

“The general prohibition set out in Section 33 of the act is very broad in scope,” Conflict of Interest and Ethics Commissioner Mario Dion says in his report on Smolik’s case.

The prohibition applies for an indefinite period after leaving public office, such as being a CGC commissioner, and reads as follows:

“No former public office holder shall act in such a manner as to take improper advantage of his or her previous public office.”

Smolik should have been aware of his post-employment legal obligations, because he was informed several times about the legal restrictions under the act, the report says.

In October 2016 he asked the Conflict of Interest and Ethics Commissioner’s Office for advice should he become employed by Cargill.

“The office informed Mr. Smolik that based on the information provided, accepting an offer from Cargill would not be prohibited under the post-employment rules of the act,” the report says. “In an email dated October 21, 2016, the office reminded Mr. Smolik of his post-employment obligation under Subsection 35(2) of the act, which prohibited him from making representations on behalf of Cargill to any department, organization, board, commission or tribunal with which he had direct and significant official dealings during his last year in office, in particular, the commission. Mr. Smolik was also informed that Sections 33 and 34 of the act apply indefinitely and prohibit him from acting in such a manner as to take advantage of his previous office or to switch sides. Mr. Smolik was also advised that should he provide advice to any future employer or client, he would need to be particularly mindful not to use information that was obtained in his capacity as a public office holder and that is not available to the public.”

Smolik informed the Conflict of Interest and Ethics Commissioner’s Office Nov. 2, 2016 he was joining Cargill nine years after being appointed to the CGC by then agriculture minister Gerry Ritz, “and confirmed that he understood his post-employment obligations.”

On Dec. 8, 2016, less than two months later the office wrote Smolik reminding him again of all his obligations under the act.

Despite the warnings two months later “documentary evidence submitted by Cargill” showed Smolik continued to advise Cargill on how to approach the CGC on the dust issue.

“In an email dated Jan. 9, 2017, Mr. Smolik informed Cargill’s senior lawyer to contact the commission’s chief grain inspector, noting that he was ‘in a bit of a tough spot’ to do so himself from his work computer as he and Cargill had agreed to a six-month ban on anything relating to the commission,” the report says. “Mr. Smolik wrote that he had met socially with the chief grain inspector earlier that week and had informed him that he may expect an email from Cargill’s senior lawyer to discuss the Sarnia terminal’s dust issue.”

Smolik denied breaking any rules, the report says.

His lawyer argued for there to be breach there must be evidence Smolik improperly took advantage of his former CGC office. His position is the evidence does not demonstrate any improper advantage.

Other points made by Smolik’s lawyer include:

  • Smolik never misused confidential information obtained while at the CGC.
  • Anyone with the internet or a telephone could have made the same recommendations to Cargill, without any special knowledge of CGC operations.
  • Smolik worked at the commission for many years and former colleagues are his friends with whom he discusses personal matters and shares interests. Smolik didn’t leverage these relationships to further any professional interest.
  • Any factual discrepancy that may have occurred between Smolik’s Nov. 7, 2017 letter to the Conflict of Interest and Ethics Commissioner’s Office and other evidence were errors of memory that were inadvertent and made in good faith.

About the author

Reporter

Allan Dawson is a reporter with the Manitoba Co-operator based near Miami, Man. Covering agriculture since 1980, Dawson has spent most of his career with the Co-operator except for several years with Farmers’ Independent Weekly and before that a Morden-Winkler area radio station.

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