REPORTING · 19th September 2012
In any courtroom, mediation or arbitration, the consultations employed by Deloitte and Touche during a preliminary review of the Gitxsan Treaty Society (GTS) finances would render the entire report worthless.
In some cases they accept one GTS director’s explanation for another’s inappropriate activities; this after inviting the GTS directors to private meetings to clarify inappropriate spending of GTS funds. Even more curious is how, after determining many of the alleged wrong doings were factual; they conclude a forensic audit is not necessary.
Deloitte and Touche discovered a memo written by Gordon Sebastion regarding Elmer Derrick and wrote;
“In a draft report of the Executive Director (Gordon Sebastian), dated December 29, 2011, a number of allegations regarding the actions and potential conflict of interest situations involving Elmer Derrick were identified. Gordon Sebastian indicated that he has obtained explanations from Elmer Derrick such that he no longer has these concerns regarding Elmer Derrick.”
Regarding funds considered double dipping by Beverley Percival the Auditors write;
It was alleged that Beverley Clifton Percival double dips with GTS wages and Vescor. Vescor was paid $286,250 during the two fiscal years ended March 31, 2009 and 2010. Vescor has apparently been doing work with GTS since 2001. According to Elmer Derrick, the entity is owned by Chief Don Ryan, who is the uncle of Beverley Clifton Percival. In addition, Elmer Derrick indicated that legal counsel was not happy with the work product.
Regarding Gordon Sebastian receiving $40,000 per year on top of his $105,000 salary with an average $40,000 expense statement (not including airfare) in 2009 and 2010 the Auditors write;
Given that Gordon Sebastian was the full-time Executive Director of GTS, and his employment agreement with GTS, dated June 12, 2003, states “A condition of your acceptance is that the current Legal Services Contract in place with the Gitxsan Treaty Society will effectively become null and void”, it is unclear why Gordon Sebastian would be paid additional monies for services rendered.
As for performing an actual audit the report clearly states this was not the intention of the entire exercise,
Our work does not constitute an audit as defined by the Canadian Institute of Chartered Accountants. Consequently, this assessment for a forensic audit and the resulting report do not constitute an auditor’s opinion nor do they represent such an opinion in any way.
In December 2011 the GTS offices were boarded up and secured by members of the Gitxsan Nation after Elmer Derrick performed a media scrum where he as “The Hereditary Chief” stated the Gitxsan Nation supported the Enbridge Northern Gateway Pipeline. The GTS had since 2008 been engaged in a lawsuit with Band Councils and numerous Hereditary Chiefs over their legitimacy. It was the Enbridge issue which tipped the patience of the majority of the Gitxsan people who came out in the hundreds to support those blocking access to the GTS offices.
After six months, after a judge declared the GTS was not operating legally, those securing the offices, now calling themselves the Gitxsan Unity Movement, agreed to open the doors as long as a full forensic audit of the books was completed. This did not happen and further the scope of the work requested of Deloitte and Touche, the firm hired by Indian and Northern Affairs Canada, now Aboriginal Affairs and Northern Development Canada (AANDC) was limited to one year and to specific allegations.
Our review and examination covered specific transaction areas for the period April 1, 2011 to May 31, 2012 (the “Review Period”) and was limited to the issues described in this report. This period was selected based on discussions with AANDC.
The report did go back a number of years when it came to certain issues such as excessive payments to the directors and others. Airline travel expenses, not identified to any specific director were an average of over $120,000 each year from 2009 to 2012. This was on top of the travel expenses reimbursed averaging well over $20,000 each. Extra payments to directors and GTS operated entities, including a whopping quarter of a million dollars ($245,262) to the Executive Director of the BC Mining Association Tex Enemark, added to the four year GTS expenditure of just under $20 million.
Gitxsan Forest Enterprises received over $2 million and Gitxsan Development Corporation (GDC), incorporated in June of 2011, received $1 million in 2012 alone. James (Jim) Angus is a director of GDC, (as well as most other GTS entitles) yet also received payments from the GTS in excess of $30,000 for each of the three preceding years.
One specified allegation was related as;
It was alleged that Gordon Sebastian hired a number of individuals without Board approval and paid them thousands of dollars.
The report then lists five people who received over tens of thousands of dollars and follows with;
As set out in the table above, there have been thousands of dollars spent on these individuals. It is not clear if the Board was aware of the costs but both Gordon Sebastian and Elmer Derrick were aware of these individuals and their involvement with GTS.
It is unclear what the Gitxsan Nation will do with these findings of wildly excessive spending but it is clear the firm whom the Gitxsan Unity Movement accepted to perform an audit of the operations from the beginning of the GTS (incorporated in 1994) were not given instructions to look any deeper than a quick review. Even though the allegations of mis-spending were found they accepted the explanations provided by the GTS directors during private undisclosed meetings, concluding no further investigation was warranted.
Residents of the Northwest will find one part of the report especially interesting regarding the highest paid person in 2012, this after the offices were blockaded. Danny Vaniez, the former owner of Repap, Skeena Cellulose, NWBC Pulp and Paper and New Skeena Forest, prior to the dissolution of the entire Northwest BC Forest Industry, received $80,000 as an eight month retainer. The report had this to say about Danny Vaniez;
DDV Enterprises LTD. is an entity apparently owed by Dan Veniez. Based on a review of the GTS electronic files, we identified the following payments to DDV Enterprises LTD. Fiscal year ended March 31 2012 $80,000
The billings are $10,000 per month on a monthly retainer basis. Per Elmer Derrick, Dan Veniez was brought in to deal with forestry issues.
By way of background, Elmer Derrick indicated that Veniez used to own a forestry company (based in Montreal), Veniez apparently ran into financial issues and sold a forest licence to a Chinese entity, Sun Wave. Subsequently, the forest licence was apparently obtained from Sun Wave and Elmer Derrick was involved in the negotiation. Gordon Sebastian indicated that GTS had an arrangement with Cam Stevens, Manager of Gitxsan Forest Enterprises (“GFEI”), such that GFEI would be hiring Mr. Veniez as a consultant on the forest license (387,000 m3 annually). However, Stevens needed time to get his finances in order therefore apparently requested GTS to begin paying Dan Veniez $10,000 per month so that GFEI would not lose the opportunity with Mr. Veniez. Mr. Stevens apparently agreed that GFEI would repay GTS for all expenditures related to Mr. Veniez. Gordon Sebastian indicated “Thus we (GTS) have reason to believe that all Mr. Veniez’s costs will be reimbursed.” The disbursements had not been reimbursed as at the time of our review, notwithstanding the $2.1 million of funding provided to GFEI identified in Table 5 above. If Gordon Sebastian is correct in his statement, then question arises as to why the amounts paid to Mr. Veniez by GTS could not have been paid from the funds provided by GTS to GFEI?
And as with all other descriptions regarding the most significant expenditures ie; Gordon Gibson, $230,000; Rick Connors (also CEO of GDC) $53,000 and Tex Enemark $250,000 Deloitte and Touché remark;
There was no contract on record and no documentation of authorization by the GTS Board for a contractual arrangement.
It is clear from the report and from copies of emails received earlier this year, Deloitte and Touche engaged in meetings with Gordon Sebastian, Bev Clifton Percival and Elmer Derrick without consulting or advising the Gitxsan Unity Movement or any others including the lawyers representing the Band Councils and Hereditary Chiefs, of these meetings. Neither did the firm request a meeting with representatives of those demanding the investigation.
These breeches of independence for a professional investigation to be considered truly fair and responsible, (requesting a clarification without advising the other parties in a dispute), renders the entire process invalid.
To find evidence during a cursory look which supports the allegations of misappropriations and then to conclude no further investigation is required is to bring ridicule to the entire process.
Ridicule is an understatement when the auditors accepted this as requiring no further investigation;
There was apparently $1.0 million dollars invested by GTS into [Black Goose Holdings] through a holding company that Elmer Derrick is apparently the sole trustee. Apparently, the investment is worthless due to the downturn in the natural gas industry.
Comment by Gitksen Gitksan Ksan on 21st September 2012
Amawillina Doy ok inisim
Alugigat Tsimshian - Gitksan - Nisgaa
Lexgeeik Niddi Ayook sun.
Lex Ghenneda Niddi Ayook sun.
Gispawada Gisgass Adawk Niddi Nok - Nok
Amalawina Alugigat Adawk Clampson Waap Ksan
Skeena River GALZAP - Z.
Comment by yvonne on 20th September 2012
The tax payers need to know how the Governments are enabling organizations such as GTS to misuse borrowed funds from the coffers of the Canadians. These are your dollars that are enabling our so called Negotiators who negotiate to keep the Gitxsan Nation in poverty. While our two negotiators, Elmer Derrick, Beverly Clifton Percival and GTS Executive Director Gordon Sebastian stay in Fairmont Waterfront hotel, expenses over a period of 4 years totaling $408,428 and Wings Travel $503,044 for a total of $911,472.
Three people claiming to present the Gitxsan Nation squandering over $900,000 of Tax Payers dollars while the majority of our citizens live in Poverty. It is time for all peoples to wake up and start calling on the government to have forensic audits on many of our Nations. It is time for the Government to quit making excuses and do due diligence.
Lets start with the GTS and not a Preliminary to an audit but a full blown Forensic audit, as was promised. This is only a very small portion of the dollars spent by GTS. Those employed or benefiting from GTS have been assisting in the misconduct by not asking for detailed financial statements with the required motions; our GTS Directors are liable for enabling this squandering to occur. They have not done their job of protecting the people and their interests.
I strongly believe that there is a cover up, "by who" that is a multimillion dollar question. It is not okay for our Canadian Politicians to hide their expenses; The Federal Government has a fiduciary duty it's aboriginal people so why is the Assessment and Investigation Services Aboriginal Affairs and Northern Development Canada not looking for more answers and dig deeper. Does the Treaty Negotiations loan have more value than the Gitxsan Nation and does it carry more weight than the people?????
Is the loan a hammer over the Gitxsan People's head???? Canada is in a deficit, yet the government keeps dishing out the tax payers dollars with no form of DUE DILIGENCE!!!!
Comment by Helmut Giesbrecht on 20th September 2012
I don't understand why you post screeds from anonymous posters. It may make sense if they offer a rational perspective or have some valid reason for remaining anonymous but the hate mail just detracts from the discussion taking place. I think it would be better if you didn't give the cowards a forum as they will keep coming back for more. Their entertainment consists of seeing if they get their stuff posted.
online "Blews" site
Comment by Treaty4ever on 20th September 2012
i believe my comment from yesterday.. i had written online 'BLOG' site. why did you change it to NEWS. i consider this online paper full of indian round steak.
i choose to remain annonymous because i choose not to have my name bashed like most people bash TREATY without being properly informed to make an informed decision.
and i am Tsimshian First nation. my mother is tsimshian, her mother is tsimshian, her mothers mother is tsimshian....... and so on.
thanks for your time :D
ED Note: This is typical of extremist right wing bully behaviour. Many like to denigrate any and everyone who does not follow accepted norms. The media world has changed and everyone is aware except dinosaurs. Websites and online writers/journalists understand this. Media like Black Press/Bell/Astral/Postmedia/Global do not. Terrace Chamber supporters like to call this site a blog yet we are continually asked to participate in media scrums and news conferences. In fact we get direct calls from Cabinet Ministers and Opposition Critics whenever a sensitive issue arises.
We are somewhat proud of the Chambers slang for us, "The Terrace Trash". This means they are paying attention and we exposed some truth they wished to remain hidden. If you must find a new term, as we do write extensively on numerous subjects, how about "The Blews".
This is a combination of the new world media. News and Blog.
And as for your anonymity, you can claim anything you want, you can tell us you are the direct descendent of Jesus Christ but everything is ignorant idiocy without your name. You, like we have expressed on this site for 5 years, are engaging in cowardly behaviour. And it is just this type of person that has allowed our society to suffer such hardships, people are afraid to stand up for their beliefs and convictions. Rather they hide behind someone else, someone who dares to speak up, left, right, good or bad, those who speak up and use their names are to be admired. Those who snipe from the shadows are to be despised.
Please do not use the Tsimshian Nation in such a shameful manner.
Heres to you Mrs. Robinson
Comment by Blocky Bear on 20th September 2012
I applaud your persistence and determination! d.b.
Comment by Janice Robinson on 20th September 2012
1. Are you Tsimshian? That is, is your Mother Tsimshian... And your Mother's mother, etc.?
Did you know MANY non-Tsimshian (eg. Sophie Pierre, Dan George, Roger Harris, Angela Wesley and her uncle from Van. Island, Gary Alexee) are the ones who are PAID substantially to force this treaty?
2. Do you know that too many non-Tsimshian residents of Kitsumkalum will be allowed to vote on this treaty?
3. The MILLIONS of dollars paid out to the Indian treaty negotiators ( and all their expenses, and the cost of all those fancy community dinners, and wages to their family members) will be deducted from our proposed, meager cash settlement?
3. Did you know that the Kitsumkalum treaty process is generally opposed by a vast majority of the Tsimshian Nation?
4. Did you know that our fishing rights have not been addressed?
5. Will off-reserve Tsimshian benefit in any way?
6, Protection for totem animals ( Eagles, Killer whales, Beavers, Ravens and Wolves) is not included.
7. Tsimshian will lose 90% of traditional Kitsumkalum territory by signing this treaty! Did you know that?
8. Residents will pay land tax. To who?! For what?
9. We will lose our tax-free status. In return for what? We still have tax-free status when working on all federal government lands and buildings and at places like North Van, etc.
10. This treaty process has proceeded thus far without appropriate consultation and consent of the Tsimshian. Did you know that?
Whii Nea ach.
bless your hearts
Comment by Treaty4ever on 19th September 2012
i have no idea why i am drawn to this online news site but it sucks me in to the entertainment everyday.
i understand the expresion of opinion. but if this is to be written in 'news' form, the authors should be willing and able to site their sources.
to the comment above... maybe you should do fundraising to raise funds for anti treaty. attend meetings and get informed about the GOOD put a smile on your face and absorbe the useful information. you are not the only member of your treaty... there are others too!
looking forward to tomorrows "news"
Ed Note: The authors (of this comment) should be willing and able to site their name.
The details of this report are direct from confidential sources and are considered accurate and reliable.
As for Ms. Robinson and Ms. Wunderlich making comments, they each attend almost every treaty and community meeting and regularily ask questions in an attempt to get answers, which they seldom receive. Each of these individuals use their real names and are willing to stand by their opinions and decisions. Unlike an anonymous commentor.
Comment by David on 19th September 2012
How much was Gordon Gibson paid?
Ed Note: Four year total is approximately $230,000.00 as a registered lobbyist.
Can I borrow $250,000 to inform members of anti treaty?
Comment by Cynthia Wunderlich (Nelson) on 19th September 2012
And then charge it to the members/communities? I need to go to Hawaii to see a skin specialist, I need a new vehicle to get to these meetings. The whole process is corrupt and in the end, the hereditary members will have to pay with their territories and resources.
There should be a new law: ANYBODY that spends treaty funds should be held personally accountable. They should have to pay it back from their own bank accounts! Let's see the big line up after that!
It doesn't seem right that the members have to pay back money that even some non - members, non - native people are spending freely and without shame.
Is there any company that can be impartial?
Comment by Cynthia Wunderlich (Nelson) on 19th September 2012
We need a forensic Audit to look into Kitsumkalum's books also. Who hire's these people? Gov?, Treaty Societies themselves? So much for the BCTC acting in "good faith". I believe we can't trust anybody anymore. The true members that have everything to lose are being railroaded by everyone, even their own people, all in the name of land, resources and $$$$. So much for our AFN "Chief" Shawn Atleo helping. What a farce, nothing but a photo op, again....
Do non-Native taxpayers hear us yet?
Comment by Janice Robinson on 19th September 2012
These types of unethical, immoral and illegal abuses of Natives by corporations, their lobbyists, Indian politicians and "business men" have been going on for over a hundred years. This is how we have been/are being "conquered!"
As sure as European "explorers" and the Hudson's Bay Company came over the Rockie Mountains, courtesy of well-paid, greedy Indian guides.....the "treaties" which pave the way for the Veniezs and Enbridges of the world depend on the greedy, sociopathic actions of the Elmers, Indian treaty bullies, et al amongst us. They brazenly do their dirty work right in our/your faces now!
This agenda will NOT be stopped without the awareness and decisive actions of Canadian taxpayers.
Whii Nea ach.
Waap Gitxon, Eagle,