A spokesman for Jacques Villeneuve says the Formula One racer never received $12 million US from the federal government to wear a Canada logo.

"It's all false," Barbara Pollock -- wife of agent Craig Pollock, who represents Villeneuve -- told The Canadian Press. "I don't know who invented it."

Craig Pollock had issued a similar denial to the Montreal newspaper La Presse on Wednesday.

Pollock said her husband and Villeneuve never negotiated any deal with the federal government.

Former Olympic gold medallist Myriam Bedard made the allegation about the huge payment to Villeneuve while testifying Wednesday at the House public accounts hearing into the sponsorship scandal.

However, a federal Public Works department spokesman said Wednesday that Villeneuve received $4,500 in 1997 under the sponsorship program to wear a Canadian flag on his racing suit.

Villeneuve, born in Quebec but now a resident of Monaco, won the F-1 world driving championship in 1997. His father Gilles was a Quebec auto-racing legend.

He is at a ski resort and may not have even heard of Bedard's allegations yet, Pollock said.

Bedard said the information, which was characterized to her as "top secret," came from her agent Jean-Marc St-Pierre.

However, St-Pierre vehemently denied he ever told her any such thing.

"I never, never said to Myriam Bedard that Jacques Villeneuve had a $12 million US sponsorship," he told RDS, the French-language sports network Wednesday night. "I don't know anything about Jacques Villeneuve's sponsorships."

He said he told Bedard that it would likely cost a sponsor $10 to $12 million to place a logo on Villeneuve.

Pollock said Villeneuve was paid by Tourism Quebec in 2001 to be a pitchman. A spokesman for that department said he received between $3,000 and $4,000.

Bedard also alleged that at a meeting with Via president Marc LeFrancois in 2001, he told her that Groupaction, the Quebec-based advertising companies at the heart of the scandal, was involved in drug trafficking.

Groupaction president Jean Brault strongly denied the allegations.
 
"This allegation is completely false and was made without one element of proof, without one iota of truth," Brault said in a statement.

Bedard also credited her artist husband Nima Mazhari with influencing former prime minister Jean Chretien's decision to keep Canada out of the Iraq war.

MPs uneasy

On Thursday, some Liberal MPs expressed concerns about where the public accounts committee's hearing was heading.

Shawn Murphy, a PEI MP, likened reaction to some of Bedard's hearsay to a three-ring circus.

"I worry immensely about the damage to people's reputations ... I worry about our process getting off the rails," said Dominic LeBlanc, a Liberal.

Even Conservative MP Peter MacKay, who has been very aggressive in Question Period on the sponsorship issue, described the Villeneuve and Groupaction allegations as "sub-plots."

He found Bedard's testimony about Via Rail to be useful.

Committee sources told The Canadian Press that much of what Bedard said Wednesday came as a surprise.

She and other witnesses are interviewed in private by a subcommittee before her public testimony.

"This is not a court of law, this is a court of public opinion," said John Williams, the committee's chairman and a Conservative MP.

He dismissed suggestions there should be a better job of pre-screening witnesses, saying it would be an "affront to the democratic system."

No follow-up questions about Bedard's allegations were asked in  Parliament's Question Period on Thursday.

When asked Thursday by reporters to offer an opinion on Bedard's statements, Prime Minister Paul Martin said he wasn't in a position to do so.