Keeping Them Honest – The AMF’s New Gatekeepers Against Corruption

Keeping Them Honest – The AMF’s New Gatekeepers Against Corruption

LiQ_Mag_Cover_July2014This article first appeared in the July 2014 issue of Life in Québec Magazine.
Life in Quebec Magazine is a lifestyle publication covering the Quebec region and is currently published at least 3 times per year.
Subscribers have their copies mailed directly to them.
You can subscribe here to guarantee your copy.

Article aussi disponible en français.

By Farnell Morisset 

High above Place de la Cité, in the grey business towers that long predate the new economic downtown’s bustling construction, Maryse Pineault looks out of the windows of her office onto the rush hour traffic of Boulevard Laurier as the regular 9-to-5 crowd below is heading home.

It’s obvious this is not the first time Mme Pineault will be staying late. From her end of the Autorité des Marchés Financiers office, Mme Pineault and her 17-person team are a new, vital line of defence against the corruption and collusion once so prevalent in government construction contracts.

Originally created in 2004 to regulate the province’s financial sector, the Autorité des Marchés Financiers (better known simply as the AMF) was initially limited to keeping control over strictly economic products and services, such as insurance and securities trading.

Maryse Pineault

Maryse Pineault

Their expansion into construction might seem a bit odd, but Mme Pineault explains how this came to be. “The delays under which the government wanted to put the law in place were very tight,” she explains. “The Autorité had the advantage of having the structures and support necessary already in place – and the expertise, too – from the Money-Services Business Act,” which required the AMF to perform similar background checks and approvals on the financial sector. “The government decided that it was better to profit from the experience of what was done and what worked well.”

To get this done, the tools and authority at her team’s disposal are vast. Without their approval, professional services firms (which include engineering firms) and construction companies are barred from bidding on provincial and municipal contracts province-wide.

Although very rare, failing to get her team’s blessing represents to some a de facto death sentence that could cost hundreds of millions of dollars and thousands of jobs.

Her team works in close collaboration with the famed Unité Parmanente Anti-Corruption (better known simply as the UPAC), which is in charge of the verification aspect of their analysis, and has total independence from political pressures. Despite a few high-profile decisions which drew intense media attention, she and her team have been careful to avoid the spotlight and stay above the fray.

Still, Mme Pineault is not without her own opinions on the allegations levied towards her team’s decisions. When the AMF denied Dessau (a major engineering firm) the right to bid on government contracts, their decision sent shockwaves throughout Québec’s construction sector. Dessau executives and supporters went as far as taking out ads in newspapers decrying that the AMF was killing Québec’s home-grown engineering expertise and paving the way for take-over by international companies who would funnel their publically-funded profits out of the province.

Mme Pineault dismisses those claims. “I hear that, I understand, but the answer is to say ‘yes, but outside companies must undergo the same processes too’. Foreign companies aren’t necessarily advantaged, they have no free pass.” Mme Pineault adds that the alarm might be overblown, pointing out, “For the rest of it, it’s talked about but I could point out that some Québec-based firms have recently bought out multinational competitors. We’ll let the market run its course.”
Accepting a company is ultimately a judgement call, albeit an exceedingly well-informed one based on principles of fairness and common sense. “It’s not because your name came up once at the Charbonneau commission that you’ll be refused, because those are just allegations. It’s more than that. Overall, it’s certain that what was mentioned at the Charbonneau commission will be noted, but it’s just one of many elements, and it’s the sum of all elements that will decide on a case,” Mme Pineault notes.

Companies not slated to be approved are sent a list of things they can do to correct their standing in the eyes of the AMF, which can vary from simply filing missing tax forms to requiring certain red-flagged executives or shareholders to give up their interests in the company. The company can contest or explain itself to the AMF, but at the end of the day the AMF must be satisfied that the company is above-board when it comes to its ethics and legal processes.

As for the companies which do not comply, well, just as individual citizens are free not to buy products or services from companies with morally doubtful practices, the government itself is not held to do business with companies known or suspected of shady dealings.

So far, Mme Pineault points out only 6 of the 500 companies they’ve reviewed failed to make a passing grade (two of which have since been rehabilitated and passed), and she’s emphatic that most companies are approaching the AMF’s requirements with good faith. “Companies have put in place, over the last few years, measures to raise their standards, improve their controls… they’ve cleaned house, gotten rid of those who weren’t above board. The media might not show it, but I can tell you that for us, that’s what we’ve noted. Companies take this authorisation seriously. It’s not just for public contracts – there’s a shift in culture.”

Will the ethical and legal gains in Québec’s construction industry hold? Mme Pineault believes so, refusing to adhere to the pessimism and fatalism of some. “Will a fraudster commit fraud? Will a thief commit theft? Yes, there will always be some, no matter the law and framework. The vast majority of companies are not fundamentally corrupt. It would be pretentious to say that things are perfect, but we need to see the goodwill on the part of the companies to understand that we’re a good bit of the way there, and the gains we’ve made, that’s already better than before.”

About Author

Farnell Morisset

Farnell Morisset has an engineering degree from Université Laval and common law and civil law degrees from McGill University, where he also studied economics.

Write a Comment

Only registered users can comment.