Councillors who supported the removal of Garry Reece as mayor of Lax Kw’alaams are raising “serious concerns of the governance practices” of both Reece and then-band administrator Wayne Drury following a report prepared by investigative accounting firm Malysh Associates Consulting.
“A lot of strange things have been going on that we, as council, and the general membership have been left in the dark on,” said Coun. Carl Sampson Jr. of the report commissioned under John Helin when he was appointed mayor.
“Unfortunately, even though this is the first risk management review we’ve done, none of the information comes as a big surprise. The band councillors also have concerns relating to many other issues that have surfaced.”
The group of six councillors — which includes Helen Johnson, Carl Sampson Jr., Russel Mather, Ted White, Geraldine Alexcee and Chris Sankey — raised a number of concerns ranging from band finances to recent events on council.
On the business side of band operations, the councillors allege that Reece and Drury have ignored advice regarding “corrective measures” for the fish plant’s outstanding loan debt and that the band’s forestry operations, Coast Tsimshian Resources, has not provided council with any financial reports over the course of the past two years while still maintaining “an expensive office and employee in China”.
Reece said in both instances, that is not the case.
“I don’t believe [advice] has been ignored. We have a board that is in place for the fish plant and they are responsible for that loan … we have a manager in place that has been doing a really good job,” he said of the fish plant, adding financials from Coast Tsimshian Resources have been provided.
“I have made it known that the [forest company] audit we have is available to all of council to go through. I left copies in the chambers and any councillor that comes in can go through it … our auditor has copies and it is reported in our audit.”
The councillors allege band funds are being held in trust by the band’s law firms and council was only made aware of it through talking to the Band’s auditors. Reece said money is in trust with the lawyers, but noted the money came from energy companies they are in negotiations with and it being held in trust by the lawyers was one of the companies’ requirements.
The councillors further allege that $250,000 was paid out of band funds paid to cover applications from the Settlement Trust Fund after the board ceased to function. While councillors say the money was “approved for payment by Drury”, Reece said the advancing of funds until the paperwork was received by the trust was approved by council.
As well, councillors allege that Drury, with Reece’s approval, has been negotiating business deals that are not approved by council, including withholding reports regarding the potential impacts of LNG. Reece acknowledged discussions have been taking place with various companies, including companies associated with LNG, but no agreements or deals have been signed or approved.
Since Reece was reinstated, the six councillors say he “moved quickly to punish” them by “stripping them of all of their portfolios, which were then handed to the councillors who support and benefit from Reece sitting as mayor” and they are ready to “fight it”. Reece acknowledged the six did have their portfolios taken away, but said it was because they were absent.
“I called a meeting after this decision came down and not one of them showed up. I have no problem with putting them on committees, but they didn’t show up. I want to work with everyone on council, and some of my councillors were removed from their portfolios when John was in place,” he said.
“I want council to start working together. That’s what everyone was elected for and that is what I expect of my councillors … they need to recognize that the court didn’t agree with them, I was put back in there and am recognized as elected mayor. I’m willing to work with all of them.”
While councillors allege Reece “put a halt” to the work being done by the consultants, Reece said he met with the firm on Dec. 4 and agreed to provide any information they want.
“We have got nothing to hide. The reports I have seen so far are that the way the band’s finances are handled so far are quite good,” he said.
Regardless of what Reece says, the six councillors said they are “reviewing other discovered irregularities that will be revealed shortly” and will appeal the federal court decision to return Reece to his mayor’s position.
“We’re done with the games and we’re done with Garry Reece,” said Coun. Chris Sankey.