Trudeau’s Top Aide Resigns Amid Reports of Meddling in SNC-Lavalin Probe

(Bloomberg) -- Justin Trudeau has lost his most trusted adviser to a growing controversy over allegations of judicial interference that the Canadian prime minister’s office continues to deny.

Principal Secretary Gerald Butts issued a statement Monday, during a long weekend in much of Canada, announcing his resignation in order to prevent the issue from distracting “from the vital work the Prime Minister and his office is doing for all Canadians.”

A report this month by the Globe and Mail newspaper raised allegations the prime minister’s office pressured Trudeau’s former attorney general, Jody Wilson-Raybould, to settle fraud and corruption charges against construction company SNC-Lavalin Group Inc. The controversy escalated last week after Wilson-Raybould, who had been moved into a new ministry recently, quit cabinet.

In his statement, Butts said he “categorically” denied the allegation that he or any of his staff pressured her.

“My reputation is my responsibility and that is for me to defend,” Butts said in the statement. “It is in the best interests of the office and its important work for me to step away.”

Butts is one of Trudeau’s closest friends and a key voice on all major decisions, considered the second most influential official in government. He and Chief of Staff Katie Telford have been the most powerful aides in Trudeau’s government since it took power in 2015.

Corruption Charges

The SNC-Lavalin case hinges on years-old corruption charges, which the company has been pressing to settle. The government gave itself the power to do so last year by changing the law to allow for deferred prosecution agreements, whereby the attorney general can order the country’s independent prosecution service to strike a deal to end a criminal case.

Trudeau acknowledged last week his government discussed the issue in part to avoid job losses at Montreal-based SNC-Lavalin, which employs about 9,000 people in Canada. He said that, in September, he told Wilson-Raybould that the final decision was hers as attorney general.

What happened between then and a January cabinet shuffle that saw Wilson-Raybould demoted to veterans affairs is unclear. Wilson-Raybould has said virtually nothing since she quit cabinet, and has hired a former supreme court judge to advise her on what she can say publicly. She’s bound by both cabinet confidentiality and solicitor-client privilege.

Liberal Ghosts

The issue has proven explosive for Trudeau, whose slogan of “real change” was meant to breathe new life into a Liberal Party whose record had been marred by corruption and back-room deals. The controversy around SNC-Lavalin -- with its longstanding ties to powerful party members -- evoked the Liberal Party of old.

“Any accusation that I or the staff put pressure on the Attorney General is simply not true,” Butts said. “I categorically deny the accusation that I or anyone else” in Trudeau’s office pressured Wilson-Raybould, he added.

The country’s ethics watchdog is now investigating whether Trudeau’s office -- run jointly by Butts and Telford -- pressured Wilson-Raybould into ordering an end to SNC-Lavalin’s criminal case. Those investigations typically take months at least.

Butts didn’t specify where he was going after his resignation. Canada is heading into an election campaign, with a vote scheduled for October. Whether Butts will continue his work as one of Trudeau’s top political aides in that campaign is unclear.

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