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Fort Smith approves forensic audit

Paul Bickford
Northern News Services
Published Thursday, Aug. 27, 2009

THEBACHA/FORT SMITH - Fort Smith town council will proceed with a forensic audit to address controversial payments to Roy Scott, its former senior administrative officer.

NNSL Photo/Graphic

Fort Smith residents read the terms of reference of a forensic audit approved by town council at an Aug. 25 meeting. - Paul Bickford/NNSL photo

As well, Councillor Brenda Johnson, who revealed aspects of the affair to a newspaper, is facing a reprimand.

Council voted to accept terms of reference for the audit at a special meeting on Aug. 25.

John McArady, one of the 20 or so residents at the meeting, said people in the town are upset by the hundreds of thousands of dollars in payments to Scott.

"A lot of them are pissed off," he said. "Somebody has to be accountable for that."

A motion for a forensic audit was originally passed on May 26, but Mayor Peter Martselos said council had been planning to rescind that motion and proceed with a less-expensive financial review on the advice of its accountants and new senior administrative officer (SAO).

That changed on Aug. 25.

"By doing a forensic review, we will clear up the air once and for all," he said. "So that's why the council decided to move forward."

The mayor denied there was public pressure for a forensic audit.

"I want to make it very clear. It's a few people, very few," he said of the level of concern in town.

The audit will cost close to $50,000, and will hopefully be complete before municipal elections in October, according to Martselos. Yellowknife accounting firm MacKay LLP will do the work.

The accountants will look at the period from January 2000 to December 2008.

Scott was suspended as SAO in March and dismissed in May after 16 years in the position.

Information in an accountant's preliminary investigation leaked to The Slave River Journal detailed a number of unusual payments to Scott, including three severance cheques totalling $240,000 between 2000 and 2005; bonus cheques of $20,641.75 in 2001 and $140,000 in 2006; $52,842 in 2002 for education leave that was never taken, and a number of other smaller payments.

At least one member of council, including the mayor, signed the cheques.

Scott is now administrator with the District of 100 Mile House in British Columbia.

Martselos said there is no money missing from the municipality.

"When the money is there, we don't have to worry where the money went," he said

The only thing the mayor would say about the payments to Scott was that they were made according to his contract.

The Department of Municipal and Community Affairs (MACA) has no plans to become involved in the controversy, unless the town requests it, said MACA Minister Robert McLeod.

"It is basically up to the community to work it out," McLeod said, adding, "We've been monitoring it very closely."

At its Aug. 25 meeting, town council also passed a motion to discipline Coun. Brenda Johnson for allegedly revealing information from in-camera meetings in a media interview about Scott's dismissal.

Martselos noted information obtained in-camera is strictly confidential.

Coun. Beckie Linaker, the chair of a three-councillor committee established to consider disciplinary action against Johnson, reported that she will receive a "severe" reprimand and will be asked to apologize in writing for her actions.

"If Councillor Johnson does not apologize, we would like for her to tender her resignation," Linaker said.

The committee also recommended Johnson should not take part in future in-camera sessions.

Johnson was not at the Aug. 25 meeting as she was participating in a Canadian Rangers exercise in the Eastern Arctic.

"I'd like for her to be here myself, but we don't know when she's coming back, and there's a time factor and we have to move on with business," Martselos said.

The mayor added the action against Johnson is fair.

"This is a very important issue we're talking here," he said. "Breaching the code of ethics is a very serious matter."

Johnson initially brought information to the attention of council that led to Scott's dismissal.

She could not be reached by News/North for comment.