Ottawa Citizen

TORONTO (CP) - Alliance Leader Stockwell Day acknowledged Saturday that he met with an alleged former undercover agent with what he called an "extensive background (in) organized crime and other things." But Day denied a report in the Globe and Mail newspaper that the federal Opposition party paid the man $6,500 to "dig up dirt" on the governing Liberals.

"I have met him. I was introduced to him by a couple of our MPs. I understand he has extensive knowledge in areas related to organized crime and biker activity and things like that," he said.

Day said no money ever changed hands with the man, described by the newspaper as a former undercover agent with the U.S. Justice Department.

"This particular individual has not been hired and I have given very clear word that if there is any consideration of his hiring, that he will not be hired," Day said.

The leader's denial appeared to contradict Alliance MP Darrel Stinson, who was quoted by the Globe as saying that after a private meeting with the former undercover operative, Day was impressed enough to "give him a shot."

Day also denied that the purpose of the meeting - reportedly arranged by Stinson and MP Myron Thompson - was to hire a spy who could provide information on the Liberals.

"Mr. Chretien in his own activities gives us quite enough work to run after and try and show that we believe there's some conflict of interest," he said. "That's very easy to do without having to hire somebody."

Alliance Whip John Reynolds said in an interview that neither Day nor anyone else in the party authorized the operative to investigate the Shawinigate affair.

"This guy is an expert is some aspects of crime," Reynolds said. "This had nothing to do with the prime minister and Shawinigate."

The opposition parties have obsessively probed business dealings in Jean Chretien's riding of Shawinigan but have yet to furnish hard proof the prime minister was in a conflict of interest.

Reynolds, who refused to identify the man, said he had worked for "many agencies, including the Canadian government." He said the man was considered by the Alliance for the task of probing organized crime and a joint CSIS-RCMP study dubbed Sidewinder.

The study was undertaken by the federal police force and the security agency in the mid-1990s to find out whether China's intelligence services worked with Canadian-based Chinese criminal gangs to influence Canadian business and politics.

Allegations surfaced in media reports that political pressure prompted CSIS to scrap the study in its draft stage. The government was allegedly worried about ruining relations with China if the study went ahead.

Reynolds said the undercover operative would have been hired to investigate organized crime in Canada and provide insight into Sidewinder, "seeing if we can crack it."

MPs Stinson and Thompson did not return phone calls Saturday.

The Globe reported that the operative, who was not named, runs a security firm and "enjoys close friendships and working relationships" with biker gangs in Ontario and Quebec.

Duncan Fulton, a spokesman for the Prime Minister's Office, said Saturday that the leader of the Opposition should not have met with the man for any reason.

"I think it's pretty sleazy and I think it drags the entire political process right into the gutter," he said, likening the story to "the worst kind of American sleaze politics."

"I don't know if Stockwell day wants to form the next government or write the next John LeCarre novel, but it's pretty sleazy."

Day said he had investigated the newspaper's allegation that the man was paid a $6,500 probationary fee, with the promise of a full-time job if the agent was able to "get the goods" on Chretien's Liberal government.

"I've checked that out, and (the $6,500 payment) apparently has never happened," he said.

Day also denied that he knew, at the time of the meeting, of allegations that the man had been arrested in connection with a break-in, and was at one time under RCMP criminal investigation for insurance fraud.

"No . . . I certainly was not aware of that," he said.

The Globe reported that criminal charges against the man stemming from the investigations had been dropped.

When asked whether he had had a "sit down" meeting with the man, Day refused to answer directly.

"As I meet with dozens of people - sometimes 20, 30, 40 people a day - members of Parliament bring in people that they think would be advantageous and helpful, and I was introduced to him," he said.

-- Rachel Gibson (rgibson@hotmail.com), April 08, 2001