The Caisse de dépôt et placement du Québec continues to do business with one of its former leaders, even after having dismissed him for “serious ethical breaches”.
Our Bureau of Investigation discovered that the Caisse still manages mortgages to this day for Alfonso Graceffa, the former CEO of its subsidiary specializing in commercial loans Otéra Capital, dismissed in 2019.
Several of these loans have even been extended in 2020, we learn in documents taken from real estate registers.
And this, despite the $7.3 million lawsuit brought by Mr. Graceffa against the Caisse, alleging wrongful dismissal.
The funds granted to Alfonso Graceffa are managed by MCAP, a subsidiary of Otéra. To date, MCAP is listed as a creditor for more than $6.4 million on the buildings of Mr. Graceffa and his business partners, including:
Only an intermediary
Otéra recognizes that these loans are indeed managed by MCAP, for a commission.
But in a written statement she sent us, she points out that MCAP does not directly lend money to the former CEO of Otéra and only acts as an intermediary between him and the banks.
These loans "were authorized and disbursed well before the departure of Mr. Graceffa in 2019", explains Otéra Capital.
Why then have signed loan extensions even after having dismissed Mr. Graceffa?
The company does not respond directly, but says that “as a loan servicer, MCAP is required to adhere to the policies, procedures and contracts of the financial institution acting as the lender-investor for the loans it administers” .
In its response, Otéra Capital also describes MCAP as "a separate company", even though it owns 78% of the assets according to its most recent annual report.
In June 2019, the Caisse had publicly stated that it would pay “no penny of compensation from the savings of Quebecers to someone who has broken the bond of trust through serious ethical breaches”.
The Caisse “fully” informed
We wanted to know why Alfonso Graceffa always used the services of the Caisse for his real estate activities, even if he sued the institution.
“Out of respect for the ongoing legal process, Mr. Graceffa is waiting for the court to rule on his procedure before making any public comments,” his spokesperson Jean Maurice Duddin replied.
In the lawsuit he filed against the Caisse, Alfonso Graceffa claims that the Caisse and MCAP were "fully" aware of the loans on his real estate properties during the years he was the boss of Otéra.
– With the collaboration of Philippe Langlois
The former big boss of the Caisse de depot Michael Sabia will be questioned under oath in court, if the lawsuit that Alfonso Graceffa has brought for wrongful dismissal goes to trial.
Mr. Sabia, now Federal Deputy Minister of Finance, was CEO of the Caisse when the ethical breaches of which Mr. Graceffa was accused occurred.
He is one of the dozen witnesses that Mr. Graceffa wants to question as part of his lawsuit filed in June 2019.
The ex-boss of Otéra claims to have been "sacrificed" by the Caisse, which was then trying "to save its public and political image" when it was the subject of reports about ethics.
He is claiming more than $7.3 million, because he believes that despite an impeccable track record, it will now be impossible for him to hold a job again in the finance and real estate industry.
On May 20, the Chief Justice of the Court of Quebec, Jacques R. Fournier, set a 12-day trial for May 2023.
In addition to Michael Sabia, Alfonso Graceffa notably intends to question Daniel Fournier, ex-CEO of Ivanhoé Cambridge, who left the Caisse in October 2019.
$15,000 cash
In the most recent version of its defence, the Caisse repeats having dismissed Mr. Graceffa for "serious reasons", including the fact of having "met in his management office at Otéra an individual with a criminal past" and having "accepted to receive from him an envelope containing $15,000 in cash".
She, for her part, wants to have seven people testify, including Salvatore Graceffa, Alfonso's brother, to whom the $15,000 would have been intended.
Quebeckers also criticize the former CEO of Otéra for having "approved or recommended loans made by Otéra while he was in conflict or apparent conflict of interest", including "l approval of at least fourteen loans that benefited friends".
According to the Caisse, Alfonso Graceffa would also have “used his position to discuss and negotiate with the leaders of a subsidiary of Otéra the conditions for mortgage financing of personal real estate properties”.
