Court File and Parties

Ottawa Court File No.: 13-20008 Date: 2018-07-06 Ontario Superior Court of Justice

Between: Her Majesty the Queen – and – Bruce Carson, Accused

Counsel: Jason Nicol (Kerry McVey as agent), for the Crown Patrick McCann, for Bruce Carson

Heard at Ottawa: May 3, 2018

Reasons on Sentence Madam Justice B. R. Warkentin, RSJ

[1] On November 17, 2015 I acquitted Bruce Carson of the offence of committing a Fraud on the Government under section 121(1)(d) of the Criminal Code of Canada. He was accused of being “a person having or pretending to have influence with the Government of Canada, or with a minister or an official of the Government of Canada, [who] did directly or indirectly demand, accept, or agree to accept for himself or Michele McPherson, a reward, advantage or benefit as consideration for cooperation, assistance, exercise of influence, or acts in connection with a matter of business relating to the Government of Canada,...”

[2] The only issue in his trial was whether or not Mr. Carson’s conduct in attempting to sell water treatment products to First Nations communities amounted to “a matter of business related to the government” as defined in s. 121(1)(d). The trial proceeded by way of argument on this issue. By an Agreed Statement of Facts, the evidence from the preliminary hearing was imported into the trial. Other than one additional document entered on consent, no other evidence was called.

[3] The conduct of Mr. Carson was not in dispute and in my reasons at paragraphs 85 and 86, I found that:

(85) It is abundantly clear from his conduct that Mr. Carson was attempting to influence government officials within INAC, Cabinet Ministers and their staff as well as high ranking members of the AFN to promote H2O’s water treatment systems. Mr. Carson never promoted any other water treatment system, nor did he appear to contemplate a competitive process to include other suppliers. Mr. Carson admitted this conduct.

(86) Mr. Carson also admitted that he used his influence in this fashion in order to obtain a benefit for his then girlfriend, Michele McPherson.

[4] Notwithstanding his conduct, I found that Mr. Carson could not have committed a Fraud on the Government under s. 121(1)(d) because it was the First Nations communities, not the government that made decisions on whether or not to purchase the water treatment systems that Mr. Carson was promoting.

[5] The Crown appealed and the Ontario Court of Appeal in a 2-1 majority, allowed the appeal, overturned the acquittal and entered a conviction of Mr. Carson. Mr. Carson appealed to the Supreme Court of Canada and in an 8-1 majority the Supreme Court denied Mr. Carson’s appeal, entered a conviction and remitted the matter to me for sentencing.

[6] Sentencing submissions occurred on May 3, 2018.

[7] The Crown seeks a conditional sentence of 18 months with the first 9 months of that sentence to consist of house arrest. As part of that sentence, the Crown also seeks an order prohibiting Mr. Carson from engaging in any lobbying activities or from attempting to negotiate any business or commercial activity with the federal government of Canada or with any Canadian government employee on behalf of any person, organization, agency or corporate entity.

[8] The Crown also seeks a no-contact order, so that Mr. Carson may not contact either Nick Kaszap or Patrick Hill. The Crown also seeks payment of the victim fine surcharge of $200.00.

[9] The defence is seeking a suspended sentence with conditions in a probation order to include community service.

[10] Both the Crown and defence were in agreement that for a conviction under s. 121(1)(d), the main elements for consideration in sentencing are general deterrence and denunciation.

Mitigating Factors

[11] The mitigating factors that I have considered are as follows:

a) Mr. Carson is in his mid-seventies.

b) While Mr. Carson did not plead guilty, by virtue of his admissions, the trial proceeded on argument of whether or not the conduct to which Mr. Carson admitted fell within the scope of s. 121(1)(d) of the Code, thus considerably shortening the time required of a trial of this nature.

c) Mr. Carson has a dated criminal record from close to 30 years ago and in that intervening time he has contributed to public service and is highly regarded in his field, as evidenced by the significant number of letters of reference filed on his behalf in this sentencing hearing.

d) Relative to other cases where individuals were convicted of fraud and influence peddling, the fraud on the government in this matter was in the form of an attempted fraud because no monies were received by Mr. Carson.

Aggravating Factors

[12] The aggravating factors I have considered are as follows:

a) Mr. Carson’s criminal record, while significantly dated was for offences of fraud.

b) Had the fraud against the government resulted in the purchase of the water treatment systems proposed, Mr. Carson and/or his girlfriend would have potentially made significant amounts of money.

c) Because this is an offence in which the integrity of the government is at stake, the issues of general deterrence and denunciation are paramount.

Determination of a Fit Sentence

[13] A list of sentencing principles and objectives are set out in section 718 of the Criminal Code. These apply when a court considers a fair and just sentence. The principles in that section require that unlawful conduct should be denounced while at the same time deterring the offender and others from committing similar crimes.

[14] As already noted, for an offence under s. 121(1)(d) the principles of general deterrence and denunciation are the primary considerations. However, I am entitled to also consider the personal circumstances of the offender.

[15] I note that Mr. Carson is currently in his mid-seventies. He has suffered a great deal as a result of the conduct in which he engaged that led to the charge against him. For example, when his actions regarding the promotion of the water treatment systems through H2O were discovered in 2011, Mr. Carson was fired from both his employment as the executive director of the Canada School of Energy and Environment in Calgary and as chair of an organization known as the Energy Policy Institute of Canada or EPIC. In losing these positions, Mr. Carson lost employment income of approximately $300,000.00 per annum from the school and $120,000.00 per annum from EPIC.

[16] Mr. Carson currently resides in a basement apartment in Gatineau, Quebec. He has become effectively unemployable. He spends much of his time writing a blog called the Morning Brief; a daily political newsletter that currently has more than 600 subscribers. Mr. Carson lives on a modest pension income however, he hopes that his political newsletter may ultimately provide a revenue stream.

[17] It is apparent from these facts that Mr. Carson’s personal circumstances have changed dramatically since 2011 when his actions became public and he was subsequently charged with having committed a fraud on the government under s. 121(1)(d). He has waited close to 7 years for a final resolution of the charge against him.

[18] I also note that the state of the law with respect to this offence under s. 121(1)(d) was uncertain when Mr. Carson was first acquitted by me in 2015, until the Supreme Court of Canada rendered its decision in March of this year.

[19] The time that has elapsed since the conduct originally came to light in 2011, the dramatic negative effect this has had on Mr. Carson’s life and the uncertain nature of the law with respect to this offence are all factors I have taken into consideration in determining what is a fair and just sentence.

[20] I believe that both the sentence proposed by the Crown and the sentence proposed by the defence would satisfy the principles of general deterrence and denunciation because of the factors I have already set out.

[21] I therefore find that the appropriate sentence for Mr. Carson for the offence of committing a fraud against the government under s. 121(1)(d) is a suspended sentence with a period of probation of 12 months during which time Mr. Carson shall undertake 100 hours of community service.

Madam Justice B. R. Warkentin, RSJ Released: July 6, 2018