Bruce Carson, a former senior aide to Stephen Harper who worked closely with the Prime Minister on environment and energy files, has been charged with influence peddling.
The RCMP said Friday that Mr. Carson, 66, had been charged the previous day with one count of fraud on the government – a crime that is punishable by up to five years in jail.
Mr. Carson, who worked off and on as a political adviser to Mr. Harper between 2006 and 2009 and was known in Conservative circles as "the Mechanic" for his ability to fix tricky situations, is accused of using his association with the power brokers of Ottawa to sell filtration systems to Canada's first nations.
Mr. Harper's office first called the RCMP on Mr. Carson after allegations connected to a news investigation by the Aboriginal Peoples Television Network. The matter was also referred to the office of the conflict of interest and ethics commissioner and the commissioner of lobbying.
The network reported that Mr. Carson had allegedly been lobbying Indian and Northern Affairs Canada and the minister's office on behalf of an Ottawa-based water company, H2O Pros, that employed his girlfriend.
Mr. Carson also raised the issue of water quality on reserves in a meeting in February, 2011, with Environment Minister Peter Kent, but the government says he did not promote the services of H2O Pros at that time.
Under legislation brought in by the government in 2006, senior federal officials are not permitted to lobby on behalf of private companies for five years after leaving the government.
"Any individual who doesn't respect our laws must face their full force as well as the consequences that come with them," Andrew McDougall, Mr. Harper's spokesman, said in an e-mail on Friday.
There are also allegations that Mr. Carson improperly lobbied the Natural Resources department on behalf of the Canada School of Energy and the Environment (CSEE) for $25-million in federal funding. Mr. Carson took a job as the executive director of the Calgary school after spending the 2008 election campaign on Mr. Harper's plane.
The charge laid against Mr. Carson on Thursday is not the first time he has had a run-in with the law. He was disbarred as a lawyer in 1981 and sentenced to 18 months in jail two years later after being convicted on five counts of fraud. Mr. Harper has said he was aware of some of Mr. Carson's background but not all of it and would not have allowed him to work in his office had he known the full details of his past.
But opposition critics say Mr. Harper must take responsibility for hiring someone with a shady past.
"It is like the red carpet was rolled out because he was one of theirs," said Charlie Angus, the NDP ethics critic. "He was part of their circle of good old boys."
Scott Andrews, the Liberal ethics critic, said he is glad that the RCMP has taken this matter seriously, but "this is really about the judgment of the Prime Minister."
Mr. Carson is scheduled for his first court appearance in relation to this charge on Sept. 10.
He was also being investigated by federal Lobbying Commissioner Karen Shepherd and Ethics Commissioner Mary Dawson, but the ethics investigation is on hold pending the outcome of the criminal case.