Manitoba RCMP probe of Peguis trust fund dollar use on hold pending federal financial review

Jorge Barrera
APTN National News
The RCMP in Manitoba has an open investigation into allegations involving the use of money from a Peguis First Nation land settlement trust fund, APTN National News has learned.

The RCMP investigation, triggered by a complaint from a Peguis First Nation band member, is currently on hold pending the completion of a financial review launched by Indigenous and Northern Affairs’ audit and evaluation branch, APTN can report. The review is being executed by auditing firm Deloitte.

The complaint filed with the RCMP involves the use of funds from the $64 million Peguis received as part of a 2006 treaty land entitlement (TLE) agreement. Some of those funds, held in trust by the Peguis Treaty Land Entitlement Fund, were used to launch a joint venture with the Manitoba Jockey Club to develop the Assiniboia Downs race horse track.

Indigenous Affairs’ audit and evaluation branch opened an investigation in December 2015 after receiving allegations involving the misuse of the TLE funds from former Peguis chief Cindy Spence. The branch tapped Deloitte to lead the probe in early 2016.

“The review is being conducted as a result of information received by the department’s audit and evaluation sector,” said a statement from department spokesperson Valerie Hache. “At this time, the review is ongoing and no additional information is available.”

The time frames for the allegations sent to the RCMP and Indigenous Affairs correspond with Glen Hudson’s previous terms as chief for Peguis. Hudson was chief of Peguis from 2007 until 2015 when he was beat by Spence, whose campaign focused on the previous administration’s alleged misuse of funds. Hudson regained his seat in March by beating the incumbent Spence.

Hudson has not been charged with any crime and no allegations against him have been proven in court.

Hudson was contacted by Deloitte shortly before the election in mid-March, according to his lawyer Jamie Kagan. Kagan said he recommended Hudson reject a meeting with Deloitte. Kagan said Deloitte wouldn’t reveal the client who requested the financial review or provide any documents ahead of time.

“I never heard back from them again. Either this is not a particularly good audit or something is fishy,” said Kagan.

Kagan said he initially didn’t believe Indigenous Affairs (INAC) was behind the financial review.

“It was during the election call, that is what made me immediately suspicious it wasn’t INAC,” said Kagan. “INAC is not going to mess around in the middle of an election.”

Kagan said the federal department’s Winnipeg office told him they were not aware of any financial probe. Kagan said he did not, at the time, contact the audit and evaluations branch in Ottawa.

When informed of the department’s statement to APTN last week, Kagan said he would be looking into it.

“I would like to know when this so-called investigation happened and I would like to know when Deloitte was retained. To me this is all interesting in an artificial sense. The details are important,” said Kagan.

As of this article’s posting, Kagan said he was still trying to get clarity from the federal department on the issue.

Shortly before the March 24 election in Peguis, Kagan penned a carefully worded letter on behalf of Hudson addressing claims around the RCMP investigation and the department’s financial review.

“We can confirm we have never been contacted by the RCMP in respect of former chief Hudson. We are not involved in any investigation and do not believe any such investigation exists. We understand this allegation to be false,” said the March 16 letter, signed by Kagan.

“We have also contacted Indian and National Affairs Canada [sic] (INAC). INAC has confirmed that there is no investigation at all of former chief Hudson. These allegations are therefore equally false,” said the letter.

In a subsequent interview, Kagan repeated his assertion that, based on the information in his possession, he didn’t believe the investigations by the RCMP and INAC existed at the time. This led him to believe the information about the allegations was incorrect, said Kagan.

Kagan said he stands by what he wrote and is willing to litigate to defend himself and Hudson.

“If your network is going to put on the air that there is a file open and here are all these allegations and they are going to put my name, my firm’s name or Hudson’s name associated with them, I can tell you there will be a response,” said Kagan. “If our letter is referred to as anything other than factually accurate there will be consequences to that. I know that every word of that letter is factually accurate.”

As to the allegations, Kagan said he has no intimate knowledge of Peguis’ side in the Assiniboia Downs venture.

“If you are talking about the Downs—which I don’t know much about and was not involved with at all. Interestingly enough I acted on the other side of Peguis on that matter,” said Kagan. “I don’t have information on Peguis and the transaction. A transaction closed and there are lawsuits outstanding related to that”

Kagan represented former NDP provincial finance minister Stan Struthers who opposed the deal between Peguis and the Jockey Club.

The Jockey Club launched a civil suit against Struthers and the province alleging a conspiracy to sink the horse race track. The suit was eventually settled out of court in 2014 through a deal between Manitoba and the club.

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1 thought on “Manitoba RCMP probe of Peguis trust fund dollar use on hold pending federal financial review

  1. Kagan clearly appears to lend evidence/cred that all those lawyer jokes are true…ha ha. He’s a lawyer that previously represented Hudsons opposition of the purchase of the ‘Downs-Jockey Club’ and now he is representing Hudson…the one he initially opposed then claims no knowledge with a letter attesting to that. Sounds like another Jockey jumping onto another horse..faster, stronger, saddle straped with more $. The ‘DOWNS’ appears to be the downfall of all involved and mores the pity for the people that have to pay for it!

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