"Algonquins of Barriere Lake File Court Action against the Government of Canada and Past & Current Third Party Managers"
February 3, 2015
By Algonquins of Barriere Lake
Last Friday, Chief and Council for the Algonquins of Barriere Lake filed a lawsuit against Canada and the community’s past and present third party managers, BDO Canada LLP and Hartel Financial Management Corporation. The lawsuit claims harms suffered by Barriere Lake caused by Canada and the third party managers, by mismanaging and withholding funds that were to be used for the benefit of the community and its members. This includes exorbitant fees paid to the third party managers from Barriere Lake’s funds. The “services” provided by the third party managers harmed, rather than helped, our members, and interfered with our ability to improve the administrative, financial, and governance services we provide to our community.
Our members continue to experience third world living conditions, in spite of the tremendous wealth generated through resource extraction within our traditional territory. Our roads, water, hydro, school, and social services remain gravely underfunded, when compared to the funding available to Canadians living in non-First Nations communities.
The leadership and administration of Barriere Lake have been working diligently to regain control of our own financial resources and governance, but the information essential to do so has been routinely withheld by Canada and by the third party managers. Repeated written and verbal requests for the most basic information about our own finances have been ignored.
After over 8 years of third party management, Canada claims that Barriere Lake remains in “default” of the funding agreement imposed by Canada. The leadership and administration of Barriere Lake have had virtually no control over or information about their finances during that time. Surely, if we remain in “default”, it is because of chronic underfunding by Canada and the failure of third party managers to competently and diligently managed our finances, for the benefit of the community and its members. Instead, Canada now claims we are in breach of the First Nations Financial Transparency Act for not reporting financial information that remains in the exclusive control of the third party managers.
The third party managers hold Barriere Lake’s money in trust, and are therefore required to administer those funds for the benefit of the community. Instead, for more than 8 years, our community has suffered gravely under the third party management regime. Without financial agency, we have been at the mercy of a series of managers who have ignored our reasonable requests for basic information, and have bounced cheques to suppliers, interfered with our economic relations with suppliers, hired and fired employees without authority, and otherwise proven themselves completely unconcerned with the interests, well-being, and future of our community. The same accountants have charged millions of dollars in fees, which have been paid by Barriere Lake, without our consent. And our members continue to live in third world conditions.
The millions paid in fees to the third party managers could have been used by Barriere Lake to hire its own professional accounting, finance, and administrative staff, and to improve the infrastructure and services available to our members. Instead, it has gone to accountants in offices hundreds or thousands of kilometers from our community, who are neither accountable to our members nor motivated to bring us out of default, because our continued default status ensures that their contracts will be renewed by Canada.
We have attempted to discuss our circumstances with Canada, and requested that third party management no longer be imposed on us. Failing that, we have requested support for taking the steps that Canada views as necessary to bring us out of third party management. Canada, through Minister Valcourt, has ignored or refused these requests.
Regrettably, we have been left with no choice but bring a legal claim against Canada and our third party managers for the damages we have suffered during the last 8 years, because of the money taken from Barriere Lake without its consent, the removal of our autonomy and ability to govern ourselves, the reduction in our administrative and infrastructural capacity, and the harm to our community’s reputation. Our claim is for $30 million: this represents the losses we have experienced because of the imposition of third party management, the negligent performance of the third party managers, and the numerous breaches of the fiduciary obligations owed by Canada and the third party managers to Barriere Lake. If we are successful, this money will be returned to the community, for the benefit of the community, rather than being held and used for the benefit of accountants in far-off cities.
Read the Press Release Article here from Media Co-op Media Montreal