Farewell to LCBO freebies
Saturday, July 26th, 2008Following is an article from the Ottawa Sun by freelance writer DAVID MENZIES. It refers to
the LCBO but is relevant to what we are talking about.
Farewell to LCBO freebies
By DAVID MENZIES
Let’s all raise a glass of bubbly and say mazel tov! as we toast the Liquor Control Board of Ontario.
The reason? Nearly a year after being exposed for possibly breaking the Criminal Code over crown corporation employees receiving gifts and gratuities from suppliers, the provincial liquor board has decided to do the right thing.
In other words, the LCBO — which operates under the oft-repeated mantra of “social responsibility” — is putting the cork in freebies.
The back story: Last August it was revealed several LCBO employees were receiving gifts — ranging from magnums of wine and cases of beer to hockey tickets — from the LCBO’s various booze suppliers.
An anonymous LCBO whistleblower alleges that no one at the LCBO is keeping track of which employees are receiving gifts, so it is unknown exactly how widespread the problem is.
The whistleblower also said some LCBO employees are apparently not declaring gifts from suppliers as taxable benefits.
Of note, the LCBO has long had an internal policy pertaining to “gifts and gratuities” in its administration manual. The policy reads: “No LCBO employee should accept any gifts or gratuities from any supplier
organization, except for promotional items of a nominal value. The Board views gifts having a value over $200 per annum from any individual or organization as the nominal threshold.”
For starters, it seems somewhat curious that the LCBO deems a gift of $200 as being “nominal.”
But the issue of what makes a gift nominal and the lack of internal gift tracking is a moot point. That’s because LCBO employees accepting gifts (or “product samples” as the kickbacks are known) may have been in violation of the federal Criminal Code.
Section 121 prohibits Crown employees from demanding, accepting or offering, or agreeing to accept, directly or indirectly, a commission, reward or benefit of any kind, from a person who has dealings with the government or a government agency.
The LCBO’s spokesman, Chris Layton, responded in an e-mail: “The LCBO has clear guidelines in connection with staff accepting and reporting gifts. These guidelines have always included reference to Section 121 of the Criminal Code of Canada.”
Clear as Guinness.
Now the LCBO is clarifying the rules for the booze industry.
In a memo dated July 16, 2008, LCBO president and CEO Bob Peter informs LCBO vendors as well as trade/marketing associations that LCBO employees will no longer be in a position to accept any gifts.
“To minimize conflict of interest situations, we (LCBO) are asking our trade partners not to invite LCBO employees to attend sports events, concerts, charity or other similar events, or to trade-sponsored sports events such as golf, tennis or curling. Our guidelines to LCBO employees are not to accept any such invitations,” says Peter.
It is perversely amusing to see Peter taking the ethical high ground when it comes to putting the kibosh on gifts and gratuities from suppliers. After all, shortly after being appointed LCBO president, Bob Peter’s daughter received a free year of university tuition courtesy of Spirits Canada, the national trade association that represents Canada’s major distillers.
All children of LCBO employees are eligible to apply.
“Bob Peter is a very wealthy man and his daughter doesn’t need this kind of handout,” says an LCBO executive. “When we (LCBO employees) found out about this, morale here just sank.”
