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Companies tied to ArriveCan scandal banned from bidding on federal contracts

The Canadian government moved Wednesday to restrict two firms tied to the controversial ArriveCan app from bidding on future federal contracts.

First, Public Services and Procurement Canada (PSPC) announced it would ban GC Strategies — the company at the heart of the scandal surrounding the ArriveCan app — from participating in federal procurements with security requirements.

The move came in addition to a November 2023 decision by PSPC to suspend GC Strategies Inc. from participating in PSPC procurement processes.

Second, PSPC took action to issue stop work orders to Coradix Technology Consulting Ltd., effectively suspending the firm from continuing any existing contract work. The government also suspended Coradix from participating in new procurement opportunities.

“The suspensions are in place until further notice,” PSPC said.

In an interview Wednesday with CTV News Channel’s Power Play host Vassy Kapelos, Charles Sousa, the parliamentary sectary to the minister of procurement, said these latest measures are part of ongoing internal investigations.

“We want to make certain that those who are contracted are the ones who are creating the work, and they can sub-contract certainly as long as they’re providing work orders and they’re getting paid for work done,” Sousa said.

At the Standing Committee on Public Accounts on Wednesday, comptroller general of Canada Roch Huppé confirmed that between Jan. 1, 2011, and Feb. 16, 2024, GC Strategies and its predecessor Coredal had been awarded a total of 118 contracts totaling $107.7 million.

PSPC said last month that ongoing reviews allowed the department to confirm there were a small number of “lower-value” contracts outside of PSPC’s contracting authority. Auditor General Karen Hogan has estimated GC Strategies received $19.1 million for its work on ArriveCan, as of March 2023.

On Thursday, the Standing Committee on Public Accounts will continue to question public servants from the Department of Public Works and Government Services about the controversial app.

The ill-fated ArriveCan app has been back in the headlines in recent weeks.

This has come as the result of a scathing auditor general report that raised red flags about the government’s management and contracting practices related to the ArriveCan app, to the news that the CEO of Dalian Enterprises, which received $7.9 million for its work on the app, was a government employee.

The Department of National Defence has already said it would suspend Dalian’s contracts and launch an internal investigation. And on Friday, “in response to information that recently came to light,” PSPC suspended Dalian’s security status and blocked the company from working on federal contracts or pursuing new government procurement ventures.

The co-founders of a company — who did not work on ArriveCan but blew the whistle about the Canada Border Services Agency’s (CBSA) contracting practices — recently detailed in an interview on CTV’s Question Period the “complicated” web of contracting and sub-contracting involving three companies that have since been implicated in the app affair: GC Strategies, Coradix and Dalian Enterprises.

Introduced during the COVID-19 pandemic, ArriveCan became mandatory as a way to screen inbound travellers to Canada for their travel and health-related information, including vaccination status.

After months of defending the at-times glitchy application, and insisting it was a “critical tool” despite pressure from the travel industry and opposition MPs to scrap it, the federal government made the use of ArriveCan optional when it lifted a range of COVID-19 restrictions in October 2022.

MPs have endeavoured for months to probe the problematic pandemic-era border app, and Conservative Leader Pierre Poilievre has also advocated for a deeper dive by police into the matter.

Pointing to the ongoing investigations related to the controversial ArriveCan app, Prime Minister Justin Trudeau said last week that there will be consequences for anyone who tried to profit improperly from the “extraordinarily difficult” COVID-19 era. 

With files from CTV News’ Spencer Van Dyk

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