The Chiefs of Ontario (COO) racked up a deficit of more than $1.3 million in the last fiscal year that continues to grow each month by tens of thousands of dollars.
It has an ongoing workplace harassment investigation into complaints from two former female employees against the previous chief operating officer and other employees.
One alleged her sexual orientation was repeatedly targeted.
Unexplained purchases on the former chief operating officer’s credit card and other unapproved expenses were also discovered in a financial review completed in July by the federal ministry of Indigenous Services.
And while that review was going on the political organization – representing 133 First Nations and thousands of people – had lawyer figure out how it could restructure and got an earful from chiefs when they were asked for their opinion.
Much of this became public at COO’s election June 27, and was first reported by Turtle Island News, a Six Nations of the Grand River First Nation based weekly newspaper, but APTN News has since obtained internal documents and interviewed stakeholders to help shed some light on the trouble within the COO.
It would appear that all of these negative developments happened during the watch of then Regional Chief Isadore Day, since the regional chief is the main spokesperson for the COO and also has a high profile position as the Ontario representative on the Assembly of First Nations executive board.
Day, who was defeated by current Regional Chief RoseAnne Archibald at that June election, told APTN something fostered the “chaos” within the organization.
He said the reality is he had little influence within the COO power structure during his three-year term and believes the board of directors must bear the responsibility for the problems.
The financial review conducted by Indigenous Services, which provides funding to the organization, revealed that COO’s board rarely met.
The organization is actually controlled by its four-member board, which is made up of grand chiefs of the provinces four political territorial organizations (PTO).
The regional chief is an ex-officio member of the board but doesn’t have a vote.
Day said two board members didn’t attend regular meetings – Nishnawbe Aski Nation (NAN) Grand Chief Alvin Fiddler and Grand Chief Francis Kavanaugh of the Grand Council of Treaty 3.
In fact, he said the board met only once during his run as regional chief.
That is, he said, until he uncovered the financial state of the organization around March of this year and got legal advice to force meetings.
He said by not meeting, although meeting was required by law, COO was effectively a ship without a rudder as it couldn’t reach a quorum to make decisions.
“They basically prevented the work that was desperately needed at the Chiefs of Ontario and they essentially crippled the organization,” he said. “It’s been an issue of money. Flat out. It’s about resources and it’s about political influence.”
Asked to explain what he meant by money, he explained PTO’s and other organizations have always jockeyed for government funding.
The COO, as a political entity that represents all Ontario chiefs, was in direct competition for funding with other more local tribal councils whose leaders made up the COO board.
Day also said by not meeting, the former chief operating officer, Nathan Wright — who reported to the board and not the regional chief, even though their offices are in the same building — was allowed to operate without a boss and continued to provide employment to people when there was no funding for their positions, which is the main reason for the deficit according to a draft report of the financial review that was still being shared by Indigenous Services in August.
The review said the deficit continues to grow each month by nearly $58,000 due to people having jobs that have no funding.
But the review didn’t just find a growing deficit and unexplained expenses, but a broken management structure.
“There appears to have been limited governance activities and oversight of the financial administration of COO by its Board of Directors (BOD) and a great deal of authority was placed with the Chief Operating Officer,” auditors said in their report in July.
The report confirmed that once the financial issues came to light that is when the board started meeting.“As yet, there is no clear reason or cause for the lack of BOD meetings,” the report states.
The report identifies one person who could not be interviewed for the audit: Alvin Fiddler.
APTN reached out to Fiddler for an interview on Aug. 10, leaving a message on his cell phone. But we didn’t hear back.
A spokesperson for NAN, Michael Heintzman, did respond to a subsequent email from APTN.
Heintzman said Fiddler agreed to an interview but asked APTN to wait until after NAN’s election on Aug. 15.
APTN had no intention of publishing the story before the election as we were just beginning to look into the issues.
We asked NAN for a firm date to do the interview after the election.
Follow-up emails were not addressed until Aug. 21 when a spokesperson said NAN would now issue a statement.
Later that day, about an hour after APTN confirmed an interview with the new regional chief, NAN wrote again saying Archibald would be speaking for NAN and Fiddler.
APTN countered that Fiddler’s involvement as a director was something he should address.
Heintzman did say Fiddler participated in the financial review without providing any explanation as to how.
APTN then reached out to Kavanaugh, who was out of the country on vacation.
The Grand Council of Treaty 3 provided its executive director, Gary Allen, for an interview.
Allen also ran against Day in the last election.
APTN asked Allen if personal differences played a role in why the board didn’t meet.
“I don’t view it in that way. I know essentially we’re all trying to work together; we’re all on the same team. I don’t see that was the issue,” said Allen.
He said the reason the board didn’t meet is because they didn’t know they had to.
“I think it’s just from a lack of understanding,” said Allen. “There wasn’t really a clear understanding of what the clear responsibility was for the board of the directors.”
Day doesn’t see it that way.
“It was political. If you want to be political, fine, but you are a director. You have to meet. You can’t expect someone is going to teach you your role. If you are a grand chief, and you have connection to the Chiefs of Ontario, you also have an obligation to understand what that role is,” he said.
In subsequent interviews with Day he alleged to APTN that the political maneuvering wasn’t just about the board not meeting, but also about how the June election unfolded.
He said Treaty 3 and NAN both had candidates in the race against him. He said NAN picked Archibald and Treaty 3 flagged Allen.
There’s no written rule saying grand chiefs or PTO’s can’t support certain candidates but Day believes the grand chiefs role as corporate directors puts them in a conflict.
“At the end of the day these grand chiefs should not be interfering in the elections. It’s like me, if I am the regional chief, and I am interfering in the NAN election. If I am saying well we want to run a candidate that is going to be to our liking,” said Day.
Before announcing she was going to run for regional chief Archibald worked briefly — from January to about April — for Day as a consultant when he was still regional chief.
Day said her job was to build bridges between COO and NAN because it was no secret there was a disconnect.
She was at COO when Day said he first learned about all the problems it faced.
She then ran on a campaign to clean up the organization.
Day said Archibald told him she had NAN’s support.
“I was actually warned by RoseAnne. She told me that NAN is going to run the block vote,” said Day.
That meant Allen would run and then shift his chiefs (and their votes) to Archibald after the first ballot. Whether or not this in fact was planned in advance, it did unfold that way.
It was very easy to see how the support shifted during the election because the COO use a voting system where the chiefs line up behind the candidate they support.
Before the third ballot was counted the 15 chiefs behind Allen walked to Archibald’s line.
The end result was 67 votes for Archibald, 37 for Day and 13 for Six Nations Chief Ava Hill.
So if the 15 Allen delegates didn’t go to Archibald and they went to Day instead, it have forced a fourth ballot with Day and Archibald tied at 52.
That could have changed the result since it would have been up to Ava Hill’s 13 delegates to decide in the fourth ballot.
Neither Treaty 3, NAN or COO would comment on Day’s allegation that grand chiefs interfered in the election. Allen had previously told APTN a chief asked him to run and that’s why he did.
“At the end of the day, for me, there was nothing I could do,” said Day.
But there were two other grand chiefs on the board: Patrick Madahbee, who didn’t seek reelection as chief of the Anishinabek Nation Grand Council this summer and Joel Abram of the Association of Iroquois an Allied Indians, who became a COO board member in June 2017.
Day said Madahbee and Abram were always willing to meet as part of their fiduciary duty to COO. Madahbee declined to be interviewed saying he served his people for 46 years and was on a beach reading a book enjoying his retirement.
Abram spoke to APTN and said the financial problems didn’t start until April 1, 2017.
“There’s established financial policies and policies about spending authorities and those were pretty much ignored,” he said. “The majority of the deficit was the unfunded positions. They did have funding at one time but once those funding agreements ran out those positions should have ended as well. But for some reason they weren’t.”
As for the problems with the board Abram thinks it’s an “aberration.”
“I can’t really explain that part. My main intention is to make sure it doesn’t happen to the current board or a future board,” he said.
A deeper look into the documents detailing the problems at COO shows the current deficit may have begun in April 2017 but the organization’s broken structure and political divide has been longstanding.
According to a restructuring report done, the organization has always talked about the need to restructure due to “the unclear and uncertain role of the Chiefs of Ontario.”
That is a quote from a report dating back to 1980.
“Throughout the years, the Chiefs of Ontario have conducted a number of restructuring reviews that were mandated to explore ways that the Chiefs of Ontario should be restructured to fulfill and clarify its roles and responsibilities. These past restructuring reviews have failed to be fully implemented,” wrote lawyer Jenny Restoule-Mallozzi in her June 2018 report.
As part of the report, 57 questions were put to chiefs to gauge their understanding of the organization and thoughts on such things as the board. The majority of chiefs felt the board needed to be restructured.
Here are just a few of the highlights (their identities were kept confidential in the report): “Political people should not be sitting at a corporate board. It should be made up of experts in HR, finance, legal etc.,” one chief said. “The current structure they set up is not working … due to continuing north/south divisions and PTOs ‘opting out’ by ‘boycotting’ meetings by simply not attending or even joining conference calls,” another said.
“Is the Board of Directors really the problem here? I think not,” said a chief but added no additional information as why.
To view the full restructuring report click here.
The chiefs were also asked about the Political Confederacy (PC) which is made up of the four PTO’s, Six Nations and Awkesanse and two independent tribal councils.
The report found in a previous structural review in 2011 that COO acted on the “whim” of the PC “and is often unable to act on resolutions of the Chiefs in Assembly (the 133 First Nations) due to political interference.
”These are some of the complaints chiefs made about the PC in the latest report when asked what role it plays: “No idea what they do. Not transparent or accountable.”
“The PC is an advisory board to the (Ontario Regional Chief). The PC provides guidance and experience while representing all regions in Ontario. It should never try to make unilateral decisions behind the back of the Office of the Regional Chief.”Other chiefs expressed concerns with Wright, who is no longer with COO after taking a leave of absence March 7.
It’s believed when that leave ended, COO moved on from Wright. However, when interviewed by APTN, Wright said he couldn’t discuss the details on his exit as the chief operating officer. He also couldn’t discuss the workplace harassment investigation but said he will make himself available to be interviewed by investigators.
As for the issues with the board, Wright said he did try to get them together.”
All I can say is there was communication back and forth by way of emails trying to seek certain dates (to meet). Those certain dates did not work for all of [the board] for me to achieve quorum but every attempt was made to meet on a quarterly basis just to go over a number of items whether that be financial or (human resources),” he said.
The Indigenous Services financial review looked at a sample of purchases made on Wright’s corporate credit card and found there was a lack of receipts and invoices or approval. Wright said he would try to seek approval from the board if there were large purchases.
“I made every attempt not to go over certain amounts,” he said.
The report found the majority of payments made with the card were eligible, even without approval, except $2,807 for what the report described as a “donation, an online casino, a video website membership and cash withdrawals.
“Wright couldn’t recall what the online casino payment was for but said the COO was looking at an online data system. While regional chief, Day didn’t have a corporate credit card.
He said he declined to have one. The review did look at sample payments made to reimburse him for travel and other expenses. It found the majority of payments were approved and were eligible except two.
One was for $2,500, and while it was approved, there was no receipt or invoice. Day said it was for a cost of living increase that everyone at COO received.
The other expense was for towing charges and a parking ticket in Toronto on May 11, 2017. Day said Wright approved all his expenses. As for what he thinks of Day, Wright had nothing but good things to say.
“I will speak very highly of him. I thought he did probably one of the most bang-up jobs as an advocate bringing our issues to the forefront. It was a pleasure working with him,” he said.
“To this day I am very proud of the work he and I did in those three years.”
He said one area he is most proud of is the work the COO did, along with other chiefs, on Hydro One and securing energy shares for First Nations, as well as reducing hydro rates on-reserve.
Day said when he first learned about the financial situation of the COO he was in “shock” but was prepared to address it, even if it was just a couple of months before the election.
“I had no choice. I had to find a way to address it,” he said. “At the end of the day, I forced the restructuring. I forced the workplace investigation and the (Indigenous Services financial review),” he said. “I was able to stand up with a high degree of integrity and to say, ‘Chiefs I have done everything I could. It’s unfortunate the organization has went through this. But this is a chiefs organization, not a grand chiefs organization.’”
But he said he also wanted the people to know, the rights holders. The mothers struggling to keep their kids from child welfare agencies or the kids who want to attend school on-reserve.
“They have a right to know what has been happening,” he said. “The structure and the system is broken and it has to be fixed.”
He may have gotten the ball rolling, however fixing it no longer falls to him to see it through.
As mentioned earlier, RoseAnne Archibald’s election platform was fixing COO.
“I am known as a fixer, somebody that comes in and knows how to fix situations that are difficult,” said Archibald, adding she has over 30 years of experience doing so.
She said the first step was organizing a restructuring committee and then writing proposals for funding.
“Indigenous Services Canada who has already committed to work cooperatively with us on the restructuring project in terms of providing some funding,” said Archibald. “My goal is to get back to zero by March 31. I know that’s possible. I don’t want people to think there’s a big deficit at Chiefs of Ontario that’s not solvable. It is solvable. It is solvable and I am going to solve it and you will be able to see that by March 31. People will be able to see that. We are making the organization better.”
She also intends to have a clear picture of how the COO will restructure by June 2019. When asked what went wrong at the COO, Archibald couldn’t say.
“In terms of what’s happened in the past, I don’t know. I just don’t know what went wrong. I really don’t,” she said.