* Confirms Carney stayed with Liberal MP, finance critic
* Central bank says Carney and Brison friends for decade
* Liberals reported to have pressed him to run for leader
By Louise Egan and Randall Palmer
OTTAWA, Dec 17 Bank of Canada Governor Mark
Carney did not breach conflict of interest policy by vacationing
at the home of a Liberal Party lawmaker, his chief spokesman
said on Monday, following a report that the visit occurred while
the opposition party was seeking to recruit him.
Carney, who will become the Bank of England governor in
July, finds himself at the center of controversy after the Globe
and Mail newspaper reported new details on Saturday about the
Liberals' efforts earlier this year to woo him into running for
leadership of the third-place political party.
A Bank of Canada spokesman confirmed the report that Carney
and his family stayed at Liberal legislator and finance critic
Scott Brison's home in Nova Scotia during part of their summer
The news led some analysts to question Carney's judgment and
the central bank's political independence. The spokesman said
Carney and Brison had been personal friends for about a decade.
"The Bank of Canada's general counsel, who is responsible
for enforcing the bank's conflict of interest policy, has
assessed that this visit does not breach the bank's conflict of
interest guidelines in any way," the spokesman, Jeremy Harrison,
said in a statement.
"Neither the Bank of Canada, nor Governor Carney, have an
actual or potential commercial or business relationship with Mr.
Brison," the statement said. "Mr. Carney's acceptance of
hospitality provided by a personal friend does not arise out of
'activities associated with official bank duties'. Nor can it be
defined as partisan or political activity."
The Globe and Mail newspaper reported that Brison, along
with a number of other senior party members, have expressed
interest in seeing Carney lead the Liberal Party.
The article cited unnamed Liberal officials as saying Carney
asked questions about the race. The bank said it would not
comment on anonymous citations.
Carney, in an interview with the newspaper, declined to
answer questions about any political leanings. He said he had
been approached over the years by people from across the
political spectrum and that he "obviously" did not act on any
invitation to seek political office.
"Different people, different parties, different approaches,
different -- and you can say different levels of seriousness.
And so, I mean there's nothing striking about anything in the
recent past," he said, according to a transcript provided by the
"Nobody did anything on my behalf. I never asked anybody to
do anything. I never made an outgoing phone call ... so take
anything you hear with a grain of salt."
In public, Carney has repeatedly batted away questions about
any political ambitions, at one point saying at a news
conference in October: "Why don't I become a circus clown? I
appreciate the great concern about my career but I have gainful
employment and I intend to continue it."
Then in a Nov. 7 television interview, Carney gave his
clearest denial of interest, saying "I have no intention of
seeking political office."
LACK OF JUDGMENT
But the latest revelations have led to criticisms from some
commentators, who say there are risks that the central bank's
impartiality could be called into question if officials are
linked too closely to politics.
The bank's conflict of interest guidelines urge employees to
avoid the appearance of impropriety in accepting hospitality or
"It does shows a complete lack of judgment," said Mike
Moffatt, an economist at the Ivey School of Business at the
University of Western Ontario.
"The larger issue here is that Carney is being seen as the
guy who can do no wrong," Moffatt said. "For the most part, he's
been a very strong governor. There's some point where you start
to believe that anything you do is justified because you've been
doing such a great job and that's where these sort of ethical
lapses get in."
Finance Minister Jim Flaherty declined to comment on the
issue when questioned by reporters on Monday. Conservative Prime
Minister Stephen Harper's chief spokesman Andrew MacDougall
said: "Mr. Carney has done an admirable job as governor of the
Bank of Canada."
There had been reports for months that the Liberals, once
Canada's dominant party, had tried unsuccessfully to recruit
Carney after losing heavily in the 2011 election. A Facebook
page was created called "Draft Mark Carney for LPC (Liberal
Party of Canada)" with Brison being one of the high-profile
Liberals who "liked" it.
In the end, he accepted an offer to replace Mervyn King at
the Bank of England.
The current front-runner for Liberal leadership is Justin
Trudeau, a former school teacher and son of onetime Canadian
Prime Minister Pierre Trudeau.