MONTREAL (AFP) - The former head of a Montreal hospital has been arrested in Panama on fraud charges, Quebec officials said.

Arthur Porter is suspected of receiving a kickback from Canadian engineering giant SNC-Lavalin after it landed a US$2.4 billion (S$3 billion) to build a new hospital.

Mr Porter and his wife Pamela were arrested in Panama on a warrant issued by Interpol.

He is accused of fraud, conspiracy to commit fraud and other crimes, the UPAC anti-corruption unit said on Monday.

News reports say SNC-Lavalin paid out US$22 million to win the contract to build a new McGill University Health Center.

Mr Porter, a respected businessman in Quebec, resigned abruptly in 2011, and was later traced to the Bahamas.

He owns a clinic there. The reasons for his presence in Panama were not immediately known, as in March he said he was fighting cancer.

UPAC was created in 2011 after a series of corruption cases involving the assignment of public works contracts in Quebec.