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The Liberal Party of Canada is investigating a $30,000 loan
made to Sikh temple by Brampton-area Liberal MP Gurbax Malhi

Toronto, March 12, 2005
Globe and Mail

The Liberal Party of Canada is investigating a $30,000 loan made by Brampton-area Liberal MP Gurbax Malhi's riding association to a local Sikh temple, a transaction that raises questions of wrongdoing.

Brian Nichols, who chairs the constitutional legal affairs committee of the Liberal Party of Canada (Ontario), said he will look into the transaction, which took place in 2002.

“As a general rule, a loan to an outside organization by a riding association is not an action the party would condone,” Mr. Nichols said.

“We will consult with all parties involved to find out exactly what happened.”

The constitution of the Liberal Party of Canada (Ontario) does not expressly prohibit riding associations from lending money, and this is the first complaint he has received, he added.

Mr. Malhi's Brampton-Gore-Malton-Springdale riding association lent a Sikh gurdwara in Mississauga $30,000, and the temple repaid it on Feb. 21, 2002, according to documents obtained by The Globe and Mail.

The transaction angered former members of the temple. They have hired a lawyer to pursue legal action against the gurdwara, run at the time by Gurmail Singh Saggu, who was head of Mr. Malhi's riding association in 2002. They wondered why their donations to the temple were used to pay back a loan rather than for temple activities.

“We have no knowledge about why this cheque was written, but we know it was improper,” said Axi Leighl, a lawyer who represents former members of the now-defunct gurdwara.

Mr. Malhi came under scrutiny this week after The Globe reported that the RCMP looked into complaints that he misused temporary resident permits for political ends in 2003. Mr. Malhi has strongly denied the allegations and says he never pressed the Indo-Canadian community for donations and political support in exchange for help securing ministerial permits for Indian nationals to visit Canada. Complainants refused to co-operate with the RCMP, who laid no charges. Police did not interview Mr. Malhi.

In the House of Commons yesterday, British Columbia Indo-Canadian Conservative MPs Nina and Gurmant Grewal accused the federal Liberals of trading immigration favours for electoral support, a charge Immigration Minister Joe Volpe angrily dismissed.

“If the member had a shred of decency about him he would feel embarrassed about those kinds of accusations,” Mr. Volpe said of Mr. Grewal.

Mr. Volpe brushed aside calls for the government to provide riding-by-riding breakdowns of temporary residency permit issuance.

Mr. Malhi said he knew nothing about the financial transaction involving his riding association, referring all queries to Mr. Saggu. “That $30,000, the guy borrowed it from the riding association, the association knew about that,” Mr. Malhi said. “He returned it. He borrowed it for one month.”

Mr. Saggu said he didn't discuss the transaction with Mr. Malhi until after the money was returned. “As riding president [at the time], I used my rights to lend the money. We had a problem closing on the mortgage [at the gurdwara] because we were experiencing monetary problems and the temple burnt down.”

In 2001, a fire destroyed the Sikh temple, incorporated as the Ramgarhia Association of Ontario. The fire, which caused $50,000 in damage, gutted the small, one-storey former residence and left a 72-year-old man with severe burns. However, the Sri Guru Granth Sahib, the Sikh holy book, was left intact and some gurdwara members continued to meet until last year.

“This was a bungalow with two illegally constructed additions and both the building department and the fire department had orders outstanding against the property to correct violations of the building code and fire code,” said Kevin Duffy, assistant deputy chief with the Mississauga Fire and Emergency Services. “The cause of the fire was undetermined.”

The temple also lost its charitable status in 2000 for failing to file tax returns.

When it registered as a charity in 1992, its objectives included maintaining a temple to promote the history, heritage, religion and language of Sikhism, according to documents.

Small gurdwaras run out of residential buildings are permitted to apply for tax-exempt charitable status and issue receipts for donations — but allegations of wrongdoing have arisen about some of them in the past. “You want to earn money, start a gurdwara in your basement, get tax credit . . . and they can earn money [by asking for donations],” a source told The Globe.

Mr. Saggu denied anything improper was going on at his gurdwara. He said it was working to get its charitable status reinstated, but is now closed.

In 2004, Mr. Malhi received $68,500 from his riding association for the election campaign, according to the Elections Canada website.

The riding association has until May, 2005, to report donations made the year before.


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