Lawsuit over Fort McMurray First Nation finances fuels protest outside band office

An ongoing controversy over more than $1 million in payments made to band officials has disrupted a northern Alberta First Nation community, prompting a lawsuit and a blockade of band offices.

Last week, members of the Fort McMurray No. 468 First Nation blocked access to the band’s offices with a pickup truck and signs.

When CBC News visited Wednesday morning, the third day of the protest, an outfitter tent had been set up and about 20 people gathered around a fire pit with placards.

The First Nation includes four reserves in the Gregoire Lakes area southeast of Fort McMurray.

“Each of our members have complained to me … complained among themselves about what’s happening with our leadership, with our finances, with our future,” said Velma Whittington, one of the protest organizers. 

Brad Callihoo is CEO of Fort McMurray No. 468 First Nation. (David Thurton/ CBC)

On Wednesday evening the band obtained an emergency court injunction against the protesters. The injunction allows protesters to demonstrate but prevents them from blocking access to the offices.

The protesters told CBC they’re vowing to challenge their leadership in the wake of a lawsuit over expenses and bonuses paid to Chief Ron Kreutzer, CEO Brad Callihoo, a corporation controlled by Callihoo, councillor Ronald Kreutzer and former councillor Byron Bates.

Band councillor Samantha Whalen initiated the lawsuit. She has since been suspended from her duties and faces an internal disciplinary hearing at an unspecified future date.

All the defendants deny the allegations, none of which have been proven in court.

Misappropriation of funds alleged

In an amended statement of claim filed in December, Whalen alleges misappropriation of the band’s funds. She alleges that $600,000 from a $34.8-million settlement with the federal government was diverted to Callihoo in November 2017.

It is alleged the money was transferred to Calihoo’s company without following the band’s governance procedures.

Fort McMurray No. 468 councillor Samantha Whalen sits down with CBC for an interview on Jan. 10, 2018. (David Thurton/ CBC)

Whalen also claims the band covered about $500,000 of charges on Callihoo’s personal credit card in 2017. The charges “included personal expenses,” Whalen says in her statement of claim.

“It just didn’t pass the sniff test,” she told CBC in an interview.

Whalen also alleges that in 2018, Christmas bonuses were paid out to Callihoo, the chief, two band councillors and Bates, now CEO of Christina River Enterprises, the band’s business arm.

Altogether, the lawsuit alleges $270,000 in bonuses was paid out December 2018.

Whalen, one of the band councillors, said she didn’t cash the cheques she received.

“I was enraged. I was completely enraged,” Whalen said. “I don’t deserve $65,000.

“It’s my opinion that the nation is not doing well enough to deserve that.”

Sophie, Countess of Wessex, centre, and Fort McMurray No. 468 First Nation Chief Ron Kreutzer, right, watch a traditional ceremony during a visit to Fort McMurray Alta, on Friday, June 24, 2016. (THE CANADIAN PRESS/Jason Franson)

Whalen said the reserve is dealing with a number of pressing issues, including the lack of proper housing.

CBC visited the home of a 74-year-old elder who said his trailer was infested with black mould and the rotting exterior no longer kept out the cold. You can watch the video below.

Fort McMurray #468 First Nation councillor Samantha Whalen initiated a lawsuit over alleged mismanagement of First Nation finances. 2:17

False allegations, chief says

The chief, the band’s CEO and the other defendants named in the lawsuit declined CBC’s request for an interview. But in a news release Thursday, the defendants denied all the allegations in the lawsuit.

“Each and every allegation by Ms. Whalen is false and her claims will be defended in court,” the statement said. “[Our nation has] seen remarkable progress in recent years through strong and effective governance, increased accountability and transparency.”

In a joint statement of defence filed in November, the defendants say the $600,000 paid to Callihoo was a performance bonus for an underpaid band CEO who worked for “less-than-market rates.”

The payment was approved in writing by the chief and two councillors, recorded in the band’s financial statements, and not hidden from view of band members, the statement of defence says.

As for the CEO’s personal credit card paid for by the band, the statement of defence says Callihoo was being reimbursed for work expenses, all of which were “fully documented and verified prior to reimbursement.”

The statement of defence does not respond to Whalen’s allegations about Christmas bonuses. It was filed Nov. 26, 22 days before Whalen amended her statement of claim with allegations about the bonuses.

The news release said Whalen was suspended as band councillor with pay for various reasons, including “breaching her oath of confidentiality.”

“This is an extraordinary step, it is a necessary step,” Chief Ron Kreutzer said in the release.

Whalen will face a disciplinary hearing at a date to be determined.

Connect with David Thurton, CBC’s Fort McMurray correspondent, on FacebookTwitterLinkedIn or email him at david.thurton@cbc.ca 





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Sherwood Park

Sherwood Park is a large hamlet in Alberta, Canada within Strathcona County that is recognized as an urban service area.[7] It is located adjacent to the City of Edmonton’s eastern boundary,[8] generally south of Highway 16 (Yellowhead Trail), west of Highway 21 and north of Highway 630 (Wye Road).[9] Other portions of Sherwood Park extend beyond Yellowhead Trail and Wye Road, while Anthony Henday Drive (Highway 216) separates Refinery Row to the west from the balance of the hamlet to the east.[9]

Sherwood Park was established in 1955 on farmland of the Smeltzer family, east of Edmonton. With a population of 70,618 in 2016,[6] Sherwood Park has enough people to be Alberta’s seventh largest city, but technically retains the status of a hamlet. The Government of Alberta recognizes the Sherwood Park Urban Service Area as equivalent to a city.

History

Sherwood Park, originally named Campbelltown, was founded by John Hook Campbell and John Mitchell in 1953 when the Municipal District of Strathcona No. 83 approved their proposed development of a bedroom community east of Edmonton. The first homes within the community were marketed to the public in 1955. Canada Post intervened on the name of Campbelltown due to the existence of several other communities in Canada within the same name, so the community’s name was changed to Sherwood Park in 1956.
Geography

The Sherwood Park Urban Service Area is located in the Edmonton Capital Region along the western edge of central Strathcona County adjacent to the City of Edmonton.[8] The majority of the community is bound by Highway 16 (Yellowhead Highway) to the north, Highway 21 to the east, Highway 630 (Wye Road) to the south, and Anthony Henday Drive (Highway 216) to the west. The Refinery Row portion of Sherwood Park is located across Anthony Henday Drive to the west, between Sherwood Park Freeway and Highway 16. Numerous developments fronting the south side of Wye Road, including Wye Gardens, Wye Crossing, Salisbury Village and the Estates of Sherwood Park, are also within the community. Lands north of Highway 16 and south of Township Road 534/Oldman Creek between Range Road 232 (Sherwood Drive) to the west and Highway 21 to the east are also within the Sherwood Park urban service area.

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