MONTREAL - The Charbonneau Commission took a closer look at Montreal's English-language superhospital on Tuesday and just how an alleged fraud of $22.5 million sprouted from one of Canada's most expensive public works projects.

The Quebec inquiry tasked with studying corruption in the awarding of public contracts has turned its attention to the $1.3-billion McGill University Health Centre private-public partnership deal.

One of the investigators involved in the complex case outlined what police found during their investigation.

"According to the information available . . . it is the biggest fraud and corruption investigation in Canadian history," Jean-Frederick Gagnon told the inquiry.

Under the scheme, high-ranking SNC-Lavalin executives allegedly paid off senior officials with the McGill University Health Centre in order to obtain the lucrative contract.

Those accused include Arthur Porter, Canada's former spy watchdog who served as head of the McGill hospital project when the contract was awarded.

While Porter and several others were charged, their case isn't expected to go to trial right away.

Gagnon said charges before the courts estimate the alleged fraud at $22.5 million but the amount was originally believed to be as much as $30 million.

He said investigators found a contract drawn up between SNC-Lavalin and a shell company called Sierra Asset Management that suggested the engineering giant was planning three $10-million payments, disguised as instalments for a gas contract in Algeria signed by SNC-Lavalin.

Gagnon testified the amount of the fraud likely changed after SNC-Lavalin officials began to question the transaction. In the end, the dollar amount that was traced was $22.5 million, allegedly split between Porter and Yanai Elbaz, Porter's deputy.

Each man allegedly received $11.25 million in 2010, about three weeks after the SNC-led consortium won the contract.

Gagnon testified the money went to the Porter-controlled Sierra Asset Management. From there, Porter's share went mostly to Regent Hamilton Lumley Associates, a shell company under his wife's name.

Gagnon also said Elbaz had his own fictitious firm, Pan Global Holdings, which he controlled with his brother.

"It was Arthur Porter and Yanai Elbaz who each received $11.25 million under their control," Gagnon said. "Elbaz also had his brother Yohann as a beneficiary and it was these individuals who got the money.

Gagnon also said the investigation suggested regular contact between all the accused throughout the awarding for the contract.

Another witness said Tuesday the handling of the contract lacked transparency.

Normand Bergeron, former head of Infrastructure Quebec, sat on the superhospital selection committee. His organization oversaw private-public partnership contracts at the time.

Bergeron said the selection committee operated in ways he'd never seen during a long career.

He recounted that during a November 2009 committee meeting, the head of the hospital board of directors, then-Conservative senator David Angus, left the room with the president of the selection committee. When they returned, there was an abrupt end to the meeting.

In another example, Bergeron said he was informed Angus had phoned then-premier Jean Charest to pressure for a decision on the contract in late 2009.

Bergeron said it was clear from his dealings with Porter that the latter was pushing for SNC-Lavalin over the rival consortium and tried different ways to have the other party ousted from the process.

Bergeron described the former McGill boss as very persuasive and convincing. He said Porter wanted to negotiate directly with SNC-Lavalin but needed Quebec government approval.

"Without a shadow of a doubt, Dr. Porter wanted to negotiate directly with SNC-Lavalin, to give them the contract," Bergeron said.

Bergeron testified the government had pegged the hospital contract at $1.05 billion, but the two consortiums that wanted the contract submitted bids well above what the government deemed affordable — the SNC-led bid came in at $1.81 billion while the rival bid came in at $1.89 billion.

The government ordered a second process in December 2009 allowing existing bidders to tweak their bids. Not long after, Porter wrote a letter to say the hospital authority was working closely with SNC-Lavalin, even though communicating directly with the bidding consortiums was not permitted.

In the end, Porter got what he wanted: SNC-Lavalin won the contract.

Bergeron said no one questioned Porter's integrity. At the time, the city's French-language superhospital was making headlines for mismanagement and Porter appeared to be guiding the McGill project with a steady hand.

As for the criminal case, it is slowly winding its way through court with a preliminary hearing scheduled for early next year.

For now, eight people have been charged, including Porter and his wife Pamela.

Others charged in the superhospital case are former SNC-Lavalin senior executives Pierre Duhaime and Riadh Ben Aissa; the Elbaz brothers; and Jeremy Morris, the administrator of a Bahamas-based investment company, Sierra Asset Management.

The anti-corruption unit is also looking for St-Clair Martin Armitage, a consultant and former Porter right-hand man.

He's wanted on similar charges as the other accused: fraud, conspiracy to commit fraud and breach of trust in the awarding of the McGill hospital contract.

Armitage's whereabouts are unknown and he is being sought by Interpol. Ben Aissa remains detained in Switzerland on separate charges of corruption, fraud and money-laundering in North Africa.

Porter is in jail in Panama where he was arrested with his wife.

Authorities are trying to complete the extradition of both men to Canada to face trial.