Mulroney: Schreiber link was 'peripheral'

OTTAWA, May 15 (UPI) -- Former Canadian PM Brian Mulroney said Friday his relations with a German-Canadian businessman were "peripheral," even though he got $225,000 in cash from him.

"You can have clients, or partners or investors whom you do business with, but you might know them in a less intimate or friendly manner," Mulroney told Richard Wolson, counsel for the state commission investigating the dealings between Mulroney and Karlheinz Schreiber.

Wolson asked Mulroney how, given his busy schedule after leaving the prime minister's office in 1993, he again had time to meet Schreiber twice in one month.

"So you would have had time for your peripheral friend, Schreiber, two times in that month," The Toronto Star quoted Wolson as saying.

Mulroney said that was not usual and repeated that "peripheral" was appropriate to describe his relationship with Schreiber.

Mulroney's dealings with Schreiber -- a German-born Canadian citizen who is a lobbyist, fundraiser and arms dealer -- are the subject of a $14 million inquiry ordered by Prime Minister Stephen Harper and headed by Justice Jeffery Oliphant.

Its purpose it to understand the reason for the payments and when Mulroney accepted them.

Mulroney reiterated his deal with Schreiber was for legitimate work, begun after he stepped down as prime minister, promoting to foreign leaders a plan by German conglomerate Thyssen AG to build armored military vehicles in Canada for U.N. peacekeeping work.

Mulroney insisted there was nothing "sinister" about the transaction. He acknowledged dealing in cash was "unconventional," but said "it is perfectly legal to deal with Canadian tender."