Bondfield corruption investigation spreads to Sunnybrook Health Sciences Centre: Globe and Mail



Ontario Construction News staff writer

The corruption investigation into Bondfield Construction Co. Ltd. has widened to include its contracts with a second Toronto hospital, Sunnybrook Health Sciences Centre, The Globe and Mail has reported.

The newspaper says a police investigation is targeting Sam Marafioti, who was a senior executive at the hospital responsible for construction and planning, until he recently resigned. The Serious Fraud Office (SFO) is leading the police inquiries.

Marafioti has not been charged with any criminal offences. In an e-mailed statement to The Globe and Mail he said he could not provide a detailed comment while the matter was under investigation. “I do know, however, that my conduct in relation to Sunnybrook and its best interests was appropriate throughout,” he said in the e-mail.

The SFO is also investigating alleged corruption related to Bondfield at Toronto’s St. Michael’s Hospital. The hospital and Infrastructure Ontario (IO) selected Bondfield in 2014 to lead its $300 million redevelopment.

A multifaceted police probe, “which is now scrutinizing multiple hospital construction contracts as well as an alleged scheme to siphon $80-million out of Bondfield through the use of false invoices, is entering its third year,” the newspaper said in an extensive story on Dec. 21.

Bondfield’s 2019 insolvency resulted in what the Surety Association of Canada (SAC) says is the largest construction collapse in Canadian history.

The newspaper reported that SFO investigators arrived at Sunnybrook on Dec. 1 to interview three hospital executives, including Marafioti, about its procurement policies.

“Seven days later, Mr. Marafioti resigned, ending a three-decade career at Sunnybrook, which is home to Canada’s largest trauma centre,” the published report says. “In an e-mail, a spokesperson for the hospital said it is co-operating fully with the investigation and has retained a law firm to investigate.”

“This is a deeply troubling situation and we are taking this seriously,” the newspaper quoted Craig DuHamel, the hospital’s vice-president of communications, as saying.

Marafioti has worked at Sunnybrook since 1989. The hospital has awarded several contracts over the years to Bondfield, which it estimates are worth $129 million, the Globe and Mail says. “The bulk of that work was awarded during the hospital’s redevelopment in the mid-2000s, when Bondfield expanded the emergency department and worked on several research labs.”

While Marafioti led the capital projects, Sunnybrook said in a statement that he was was not part of the team that evaluated bidders.

More than $1-billion worth of Bondfield’s projects were guaranteed by Zurich Insurance Co. Ltd. through construction surety bonds.

Zurich is suing Mr. Aquino and former St. Michaels former chief adminsitration officer Vas Georgiou, as well as Unity Health Toronto, the hospital network that includes St. Michael’s, “arguing that the bonds Zurich issued on the project should be rescinded because the process was allegedly corrupt,” the Globe and Mail reported. Georgiou’s lawyer has said her client denies any wrongdoing.

Zurich is trying to recover the funds it paid out through the insolvency, asserting in court that it was deceived through the fraudulent activities before it issued its sureties.

“As part of that proceeding, lawyers for Zurich examined Steven Aquino, under oath, in 2020,” the recently published story says. “They asked him if John Aquino had ever told him about any payments he had made to anyone involved in projects Bondfield was bidding on or had secured. Steven Aquino replied that, yes, his brother told him he had paid Mr. Marafioti in connection with Bondfield’s work at Sunnybrook.

“He added: ‘We’ve done a lot of projects there. I have no idea when or why or how much. Again, like I said, I don’t even necessarily believe that it was true.’

“Mr. Marafioti was not a party to that litigation and was not offered an opportunity to respond to Steven Aquino’s testimony. The Globe quoted Steven Aquino’s testimony in a letter to Mr. Marafioti, but he did not address it in his response.

“In his statement to The Globe, Mr. DuHamel of Sunnybrook said no one had informed the hospital about the testimony. ‘It is obviously something we are deeply concerned about and the hospital will be conducting an investigation of the situation and will be engaging external counsel to assist with the review.’”


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