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Band members demand financial transparency in lawsuit against Stoney Nation

Muriel Labelle, Kenny Hunter and Wanda Rider are seeking a court order that would require Stoney Nakoda Nations to release all missing financial disclosure documents under the First Nations Financial Transparency Act (FNFTA), between 2018 and 2022, including the salaries and expenses of chiefs and council.

ÎYÂRHE NAKODA – Members representing Chiniki, Goodstoney and Bearspaw First Nations are suing the Stoney Nakoda Nation to release financial reports mandated by federal law.

Muriel Labelle, Kenny Hunter and Wanda Rider are seeking a court order that would require Stoney Nakoda Nations to release all missing financial disclosure documents under the First Nations Financial Transparency Act (FNFTA), between 2018 and 2022, including the salaries and expenses of chiefs and council.

“The plaintiffs have made multiple requests, both informally and formally, for the missing financial disclosure that Stoney Nakoda [Nation] was required to prepare and publicly disclose, pursuant to the FNFTA and the regulations,” reads the statement of claim. “Despite these requests, the Stoney Nakoda [Nation] has neglected and/or refused to provide the same.”

The Îyârhe (Stoney) Nakoda First Nation encompasses three bands – Chiniki, Goodstoney and Bearspaw – governed together by three chiefs and four councillors within each band.

Labelle, Hunter and Rider initiated legal action over a lack of transparency they believe leaves an opportunity for the mismanagement of band funds.  

The last time the Nation published financial documents required by the FNFTA was five years ago, according to federal government records. The act, mandated under former Prime Minister Stephen Harper in 2013, requires 581 First Nations across Canada to publish audited financial statements, schedules of remuneration and expenses, an auditor’s written report respecting the consolidated financial statements, and the auditor’s report or the review engagement report respecting remuneration and expenses within 120 days of each fiscal year-end.

“For each year between 2014 and 2018, the plaintiffs have had access to both the audited consolidated financial statements and schedule of remuneration and expenses prepared by the Stoney Nakoda as required by the FNFTA,” reads the statement of claim.

“However, the plaintiffs have been unable to locate the consolidate audited financial statements and schedule of remuneration and expenses for fiscal years 2018, 2019, 2020, 2021 or 2022 on any public internet site, including the Government of Canada website, which indicates that the documents for these years are ‘not yet posted.’”

Since the lawsuit was filed in early May, Stoney Nakoda Nation has released some documentation to the three band members and the matter was briefly heard in court Thursday (June 15).

The trio’s lawyer, Paul Reid, of Carscallen LLP in Calgary, said documentation submitted is still being reviewed and the matter will return to court in July at the request of the Nation’s legal counsel to allow more time to disclose all requested information.

“We are still waiting to receive fulsome information with respect to the remuneration and expenses of chiefs and council,” said Reid.

The three band members are seeking all missing financial disclosure to be submitted by the end of the month, or “an accounting of all monies received, irrespective of source, and all monies distributed, paid out, loaned, gifted, or otherwise expended by or on behalf of Stoney Nakoda for the fiscal years 2018, 2019, 2020, 2021 and 2022,” reads the claim.

They also want an independent financial auditor to prepare a report on the Nation’s finances over that time.

In its review of the last publicly available schedule of remuneration and expenses for chiefs and council, prepared for the year ending on March 31, 2018, Crowe MacKay LLP said it found nothing to believe the document was not prepared in accordance with the act.

As per the 2018 review, this process involved “making inquiries of [Stoney Nakoda] management and others within the entity, and applying analytical procedures and evaluating the evidence obtained.”

The accounting firm, hired for the independent review, was also tasked with auditing the Nation’s consolidated financial statements from 2014 to 2018.

In all its audit reports, the firm held the opinion that consolidated financial statements prepared by Stoney Nakoda management and approved by council “present fairly, in all material respects, the consolidated financial position of Stoney First Nation (…) and the results of its operations, the changes in its net financial assets and its cash flows for the year then ended in accordance with Canadian public sector accounting standards.”

But the trio of band members say there is community concern in the absence of transparency since the latest available reports. Among those concerns, they claim that Stoney Tribal Council (STC), which is responsible for administering various programs and services for Stoney Nakoda band members, including education, health, social services and economic development, and which manages an annual share of the Nation’s Heritage Trust Fund (HTF), has withdrawn tens of millions of dollars from the HTF without consultation and approval from community members of the three bands.

“Since 2008, $78.5 million dollars has been withdrawn from the total HTF funds received,” reads the statement of claim. “However, given the 2018-2022 missing financial disclosure, the plaintiffs do not know what happened to the withdrawn HTF funds, or how the annual STC HTF share has been used during those years.”

It further states “in or around 2020,” chiefs and council withdrew $40 million through a band council resolution dated Oct. 1, 2020.

“This was done without consultation and approval from Goodstoney, Bearspaw or Chiniki band members,” reads the statement of claim.

The trust fund was established in the 1990s between the Stoney Nakoda Nation and the federal government to invest surplus oil and gas royalties for the benefit of all Nation members.

As such, the litigants believe the community at large should know exactly how much is withdrawn, where funds are invested, and further, have a voice in determining how said funds are used.

Across Canada, some of the Nations required by the FNFTA to release information have done so as recently as for the 2020-21 or 2021-22 fiscal years, while some are missing information from the past several years, and others – such as nearby Tsuut’ina Nation – have not posted any financial disclosure at all.

Many First Nations have been critical of the act, also known as Bill C-27, since it was established. It’s received much backlash due to a lack of consultation with First Nations from the federal government before it was passed. 

The bill was introduced following media reports of chiefs and council members earning exorbitant salaries, including former Kwikwetlem First Nation Chief Ron Giesbrecht, who earned nearly $1 million in 2013, according to documents disclosed by the B.C.-based band, which had only about 80 members at the time.

In 2015, the Liberal government led by Justin Trudeau announced it would no longer enforce the act. Instead, it would focus on fostering relationships with First Nations and would restore any federal funding withheld from non-compliant First Nations by the Conservative government.

During the first half of 2017, the Canadian government engaged with First Nations to discuss a new approach to mutual transparency and accountability, according to information on its website.

“This process included in-person sessions and an online survey, as well as email, phone and mail-in options. Feedback received is currently being reviewed, and will lay the groundwork for a new way forward,” reads the website. 

A report was released by the federal government in 2017 recommending a repeal and update of the bill, as well as the launch of a public relations campaign to dispel any misconceptions about First Nations transparency and accountability, but no action has been taken yet.

Hunter said he and the other litigants are planning a community rally outside the Stoney Tribal Administration building before the next court date of July 10 to raise awareness for their case. 

The Outlook has reached out to the Stoney Nakoda Nation’s legal counsel on the matter and the story will be updated when a response is received.

The Local Journalism Initiative is funded by the Government of Canada. The position covers Îyârhe (Stoney) Nakoda First Nation and Kananaskis Country.

About the Author: Jessica Lee, Local Journalism Initiative Reporter

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