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Businessman testifies over

Karlheinz Schreiber, a former West German intelligence officer, lobbyist, arms dealer and political fundraiser, used a parliamentary committee hearing on Tuesday to support his onetime ally, former prime minister Brian Mulroney.

The House of Commons ethics committee summoned Schreiber, a German-Canadian citizen, in handcuffs from a jail where he was awaiting extradition to Germany on charges of tax evasion, fraud and bribery. It wanted an explanation for why he paid Mulroney, a Conservative, C$300,000 (US$296,000) in cash at a series of hotel room meetings beginning in 1993.

Mulroney has acknowledged the payments, but has said they were for helping Schreiber set up a pasta business in Ontario and an armored vehicle factory in Quebec, neither of which materialized. Mulroney is also expected to testify.

While Schreiber confirmed that he wanted Mulroney to help with the military vehicle project, he rejected the pasta business explanation on Tuesday, as well as widespread suggestions that the payments were related to the purchase of Airbus jets by Air Canada during Mulroney's tenure, a sale Schreiber helped to broker.

Schreiber said he was summoned to a meeting in June 1993 with Mulroney, two days before he stepped down as prime minister. Schreiber said Mulroney offered to lobby the government that he predicted would be formed by his successor, Kim Campbell.
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