Mike Duffy pressured to repay expenses to stem political fallout, lawyer argues

Nigel Wright, the prime minister's former chief of staff, led a schemethat would force Mike Duffytoadmit he made mistakes regarding his Senate expenses andmake it appear he had repaid $90,000, the lawyer representing the suspended senator told an Ottawa court today.

Donald Baynemade the accusation on the opening day of Duffy's trial on charges of fraud,breach of trust andbribery.

Both Duffy's lawyer and lead Crown prosecutor Mark Holmes laidout their prospective cases.Bayne, who spoke in the afternoon,repeatedlyreferred to the prosecutor's opening statement, which contendedthat Duffy was an equal partner in the arrangement of the $90,000 payment, if not the instigator.

Among the charges he faces, the 68-year-old Duffy, who represents P.E.I., is facing one count of bribery related to the $90,000 payment.

"Seldom has an extorted person been called an equal partner," Bayne said, adding that Duffy neither demanded nor received any bribe.

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He said Duffy was pressured by a small group of political operatives, led by Wright, to capitulate to their scheme that would have Duffy admit publicly to a mistakein order to stemthe political fallout when problems were raised with expenses the senator had claimed. Admitting to making the repayment, said Bayne, was the culmination of this "conspiratorial strategy."

But Bayne said Duffy never believed he made a mistake in claiming those living expenses and the evidence will show thatWright himself suggested that Duffy was "probably entitled" to those expense claims.

Bayne said that even the prime minister, according to Wright, gave the go-ahead to the scheme, again in an effort to contain the fallout.

Baynesaidthe charges against his client suggest that the suspended senatorhas been unjustly targeted.

"Mike Duffy has been singled out here," Bayne said.

Referring to the rulesthat regulateSenate expenses,Baynesaid sarcastically, "It's not a book of common sense, but it is a book that governs the Senate."

Baynesuggestedthat Duffy might not even havebreached Senate rules, much less be guilty of criminal charges.

Primary residence

He began with the issue of expenses claimed forDuffy's primary home.Duffy designated his home in P.E.I. as his primary residence, and maintains that's the case, making him eligible to claim meals and living expenses for his time in Ottawa, even thoughhe has lived in Canada's capital since the1970sfor work.

Bayne said the living expenses Duffy claimed were legitimateandwithin the Senaterules and guidelines.

"Nothing deceitfulor devious, all handed to the Senate for theirverification," he said.

Bayne stressed thatthe role of the criminalcourt is nottorewriterules or fill in the gapsif the rulesare "found lacking."

Earlier, Duffy pleaded not guiltyto 30 charges of fraud andbreach of trust, and one count of bribery. The Crown's case centres around Duffy'stravel claims, contracts and the$90,000 he received fromNigelWright, Prime Minister Stephen Harper's former chief of staff.

"I am not guilty, your honour," Duffy told the court as his trial got underway Tuesday morning.

The maximum penalty for fraud or breach of trust by a public official is five years in prison.

The RCMP allegeDuffy wrongly claimed his living allowance and otherexpenses from the time he was appointed until an outside audit was ordered to look intothe claims.

"The focus of the trial is the claims for compensation as aresult of this extra travel, which the senator contends he hadto undertake. But the theory of the Crown is that he didn't undertake any extra travel," Crown prosecutor Holmes said in his opening statements.

"Apart from the policies, there is something more fundamental at play. One, you can't steal from your employers,and two, you can't abuse your position of authority to unjustlyenrich yourself."

Holmes suggested the residency requirements for a senator meant that Duffy was probably ineligible to be one forPrince Edward Island.

Senators and MPs who live more than 100 kilometres outside the National Capital Region are allowed to claim up to $22,000 to cover their accommodationsand meals when they're in Ottawa, since they're also expected to maintain a home in the province from which they are appointed their primary residence.

Holmes said that a house Duffy owns in P.E.I.was uninhabitable and that he doesn't believespending summerson the island counts as far as establishing primary residency.

Duffy gave money 'as he saw fit': Crown

Holmes then tackled thequestion of Duffy's contracts, and those affiliated with the senator's friend, Gerald Donohue. The RCMP alleged Donohue was paid $65,000 for "little or no apparent work."

Holmes contended that the contract was effectively a clearinghouse for Duffy to hand out money "as he saw fit," and a "reserve pool over which there was no possibility of financial oversight."

Holmes also questioned the legitimacyof some of Duffy's travel claims, including one to a festival in Saanich, B.C., that also included watching a child perform at a show, and a trip to a kennel with then Conservative MPDean Del Mastrotopick out a puppy. Holmesalso claimed thatDuffy expensed a family trip as Senate business.

Holmes then turned to thebribery charge, which involves a $90,000 payment Duffy received from Wright. Holmes said Duffy was at least an equal partner in the arrangement, if not the instigator

Wright resigned after a media report revealed he provided a$90,000 cheque used to repay the living expenses that Duffy hadclaimed since being appointed by Harper

.