ArriveCan Contractor Says Conflict of Interest Steps Taken When CEO Joined Public Service

A smartphone set to the opening screen of the ArriveCan app is seen in a file photo. The Canadian Press/Giordano Ciampini

A federal government contractor implicated in the ArriveCan scandal says its president only joined the public service after work on ArriveCan was completed and that steps were taken to avoid conflict of interest.

Contractor Dalian Enterprises told The Epoch Times in a statement that president David Yeo became a Department of National Defence (DND) employee last September, “long after completion of all work on the ArriveCan app.”

Dalian also said that when Mr. Yeo when from IT consultant for DND to employee, he entered into a “confidentiality, non-disclosure and no access agreement” with Dalian that would remove him from any dealings involving the company and the federal government.

The company said Mr. Yeo has “honoured that agreement, has had no involvement in the management or operations of Dalian, and has not had access to Dalian confidential information of any kind.” It added Mr. Yeo made a proper conflict of interest filing with DND, has resigned leadership roles in Dalian, and put his company shares in a blind trust.

The Epoch Times asked DND to confirm this information but a spokesperson said he could not comment due to the ongoing investigation.

DND told The Epoch Times Feb. 29 that Mr. Yeo had been suspended and that an investigation had been launched, “due to the serious nature of the concerns raised.”

“We are in the process of suspending contracts with Dalian,” the department added.

CTV News first reported Feb. 28 that Mr. Yeo was a DND employee. There was no information available to indicate whether Mr. Yeo and his company had obtained contracts while he was a DND employee.

Dalian has had contracts with the defence department and says the federal government is its primary customer.

The Globe and Mail reported that Dalian and its affiliate Coradix obtained $400 million in contracts over the last decade.

Public Services and Procurement Canada, which has the overall responsibility for contracting, suspended Dalian on March 1 from continuing work or participating in new procurement opportunities with the federal government. Coradix was suspended on March 6.

Dalian, along with GC Strategies, was involved in the development of the ArriveCan application. GC Strategies cashed-in $19.1 million and Dalian $7.9 million. The app, used as a border measure for managing COVID-19 quarantine requirements, was initially projected to cost $80,000.

The Office of the Auditor General estimated the final cost of ArriveCan at $59.5 million, but wrote in its February report that the precise cost is unknown due to “poor documentation and weak controls” at the Canada Border Services Agency (CBSA).

The RCMP launched an investigation against the companies involved after allegations of misconduct were levelled last fall, but on a matter unrelated to ArriveCan. The RCMP recently said it has expanded its probe to include the ArriveCan affair.

Along with the probes by the auditor general and federal police, several House of Commons committees have also looked into ArriveCan.

The public accounts committee held meetings this week to study the auditor general’s report. Deputy Auditor General Andrew Hayes testified PSPC had recommended the border agency consider running open competitions for ArriveCan contracts but the suggestion was not accepted.

The auditor general found several amendments to the non-competitive contracts extended their timelines and resulted in additional costs.