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A condominium development, the CN Tower and office buildings in Toronto’s Financial District on Nov 7, 2022.Fred Lum/the Globe and Mail

A high-profile criminal case of alleged bid-rigging in the condominium refurbishment business has collapsed amid issues of court timing and concerns about the original search warrant application.

A decision by crown prosecutors to stay charges of alleged fraud, conspiracy to commit fraud and bid rigging is an unceremonious end to an investigation begun by the Competition Bureau of Canada in 2012 that covered conduct in the Toronto-area condo services industry stretching between 2006 and 2014.

“We are disappointed that this case will not be prosecuted and stand behind the findings of our investigation,” said Sarah Brown, a spokesperson for the Bureau.

In March, 2021, the Bureau announced charges under the Competition Act and the Criminal Code were being pressed against four refurbishment companies. A year later in 2022, the Bureau announced one of the four, CPL Interiors, had pleaded guilty and paid a $761,967 fine.

A trial for the remaining defendants – Lidia Anthony (Tony) of Romanin and Lidio Romanin Construction, De Oliveira of 912547 Ontario Inc. and Haralambos (Bob) Vlahopoulos of Tri-Can Contract Inc. – was scheduled to begin by Oct. 30, 2023, after a series of preliminary hearings.

That was until Oct. 18, when Crown counsel Moray Welch of the Public Prosecution Service Canada (PPSC) requested the charges be stayed.

“It is not our intention to resume these proceedings. From our perspective, the stay would be definitive,” said Mr. Welch, according to the court transcript. “We cannot begin, let alone complete, a trial on the merits in the allotted time in this matter. … In the circumstances, we see that there is no longer a reasonable prospect of conviction.”

The decision by the Crown came after a series of issues were discovered in preliminary hearings that were likely to add more time to the calendar, pushing the trial start further into the future, perhaps as late as fall 2024. That would push a trial outside the 18-month benchmark established by the Supreme Court of Canada in the 2016 case R. v. Jordan. for the Charter right “to be tried within a reasonable time.”

Among the issues being argued by defence counsel were requests to cross-examine senior competition law officer Kiran Khan, relating to elements of the information to obtain (ITO) application she presented to a judge to get search warrants in 2014.

In his Oct. 18 ruling, Justice Peter Bawden concludes there are two areas worth re-examining Ms. Khan, on the topic of the Bureau’s economic analysis of what constitutes an offence and perhaps more crucially on the inclusion of confidential informant evidence in the ITO, which is not allowed under Canadian law.

“Defence counsel also seek to cross-examine Officer Khan concerning the fact that she included an unvetted summary of the information received from a confidential informant in the warrant package,” said Justice Bawden. “The law is clear that a Justice considering a warrant application can only receive information provided under oath.”

Ms. Khan is not a police officer, but rather a lawyer who is part of the Bureau’s enforcement investigation team. In 2014, she was relatively junior in her role, and the Justice expressed concern about the Bureau’s competence in this matter.

“The evidence on this application raises serious concerns about Officer Khan’s experience and training to act as the affiant on such a complex warrant application,” he said. “There would clearly be an issue as to whether any constitutional violations were caused by Officer Khan’s inexperience or were instead systemic failings on the part of the Competition Bureau.”

The Bureau declined to comment on questions about the ITO and Ms. Khan, and a statement from the Crown put the emphasis not on its evidence but on the trial date.

“This decision was not based upon the substantive merits of the prosecution but rather on the lack of time available to complete the trial,” said Nathalie Houle in a statement from the PPSC.

Lawyers for the defendants declined to comment. During the Oct. 18 hearing, Jonathan Shime, counsel for Mr. De Oliviera, took a moment to register his client’s frustration with the prosecution.

“Our clients have lived under a shadow now for nine years … As soon as those warrants were executed, word spread quickly through the condominium refurbishment industry and this had a devastating effect on our clients’ reputations, their businesses and their personal lives.” He said.

“They [The Bureau] should recognize as a prosecutorial branch of government that their actions had a significant and terrible effect on our clients and they should issue a press release saying, we were wrong and we are sorry.”

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