German arms dealer Karlheinz Schreiber conceals his dealings with former Canadian prime minister

German arms dealer Karlheinz Schreiber won't give testimony before a Canadian parliamentary committee about his dealings with a former Canadian prime minister.

Photo: German arms dealer Karlheinz Schreiber conceals his dealings with former Canadian prime minister

Schreiber is awaiting extradition to Germany, where he faces charges of fraud, bribery and tax evasion. He was to be sent off Saturday, but the Canadian government announced late Wednesday it will not oppose his motion for a stay of extradition.

Schreiber's highly anticipated testimony could ultimately decide the legacy of former Canadian prime minister Brian Mulroney and could have repercussions on the current Tory regime.

Schreiber alleges he paid Mulroney $300,000 Canadian in cash as part of an arrangement that was finalized during his final days in office in 1993. Schreiber has said Mulroney did not follow through on his promise to help build an arms factory in Quebec and a pasta business in Ontario.

Mulroney, who served as Canada's Conservative prime minister from 1984 to 1993, has admitted he accepted the money, but said the $300,000 involved private business dealings. Mulroney has said he supports an inquiry since a wide-ranging probe is the only way to put the issue that has dogged him for years to rest.

Schreiber said he is "delighted" members of parliament are finally looking into his story, and he is prepared to do whatever he can to help the investigation, but only after the length of his stay is made clear, and after he has had a chance to review his files.

The businessman said he was given no time to access his personal documents or to prepare for the hearing, as was stipulated in a rare Speaker's warrant that compelled his testimony Thursday.

The warrant was issued by parliamentary member Peter Milliken and sent to the Royal Canadian Mounted Police and the federal ministers of justice, public safety and immigration as an attempt to keep Schreiber in Ottawa "until his attendance before that committee is no longer required."

Pending a Friday court hearing in Toronto by Ontario's Court of Appeal, the arms broker and lobbyist no longer faces an enforced flight to Germany on Saturday.

"Until the court hearing in Toronto tomorrow, the length of the stay, I am unwilling at this time to testify until the Court of Appeal decides on how long the stay will be in effect," Schreiber said Thursday.

The parliamentary committee's plan is to hear from Schreiber today, then again Tuesday and Thursday. Mulroney will appear the following week.

Canadian Prime Minister Stephen Harper said in parliament Wednesday, "I think we are all very interested to hear the testimony and do hope that those hearings tomorrow will be a credit to Parliament."

The Conservative leader announced a formal public inquiry, which will likely begin next year, after Schreiber presented his allegations in a court affidavit last month.

Royal Canadian Mounted Police and parliament security escorted the handcuffed Schreiber into the parliament buildings Thursday.

As he walked in, he raised his cuffed hands above his head.

"Canadian justice," he said.

Schreiber has been fighting extradition for more than seven years.

Germany alleges that Schreiber, who has dual Canadian-German citizenship, avoided paying income tax on $46 million (euro31 million) Canadian in commissions. The fraud charges against him are related to a deal for the sale of German army tanks to Saudi Arabia.