By Herald on July 24, 2020.
The Lethbridge Police Service has begun investigating operations of the city’s supervised consumption site and the society that runs it, but it’s still too early to determine whether criminal charges will be laid in relation to nearly $2 million of unaccounted provincial funding.
The Ministry of Mental Health and Addictions has turned over the findings of the audit to LPS for investigation on whether charges are warranted.
Kristen Saturley, strategic communications manager with the LPS, confirmed Thursday the economic crimes unit is conducting the investigation into ARCHES, the AIDS Outreach Community Harm Reduction Education Support Society. The investigation comes on the heels of the independent audit which points to allegations of undocumented or inappropriate expenses charged to the SCS, as well as to the Everyone Comes Together program by ARCHES directors.
The audit also alleges the misuse of credit cards for personal expenses, unapproved overtime billing, and a general lack of strong financial oversight by board members.
Saturley said investigators are unable to comment on the case because they are still in the early stages of the investigation.
“In order to protect the integrity of the ongoing investigation, we aren’t in a position to comment further,” Saturley said in an email to The Herald.
The audit found more than $1.6 million in provincial funding unaccounted for because of missing documentation from 2017 and 2018. Much of problem stemmed from co-mingled accounts, making it impossible for ARCHES to identify which aspects of the organization were funded by provincial money — accounting for about 71 per cent of its funding — and those funded from other sources. The agreement with the province required ARCHES to keep a separate account and expense ledger for money coming from Alberta Health.
Several thousand dollars worth of staff gift cards and expensive trips, both abroad and within Canada, are among the questionable expenses originally charged to the SCS and ECT by ARCHES management. A $2,205 television was also acquired for the ARCHES board room without providing a receipt, and the organization’s petty cash uses were also not reconciled properly.
Referenced in the audit, one unnamed executive’s salary reached $343,000 in 2018/2019, a sharp increase from $87,121 recorded in 2017/2018. Of that $343,000, $72,000 was charged in overtime expenses for which the executive did not seek approval beforehand from the ARCHES board, as required under the organization’s own guidelines.
The funding agreement ARCHES has with the province only allows for $80,000 to be drawn for the executive’s salary, but the auditors were unable to determine, because of the co-mingling of accounts, how much of the executive’s salary was taken from provincial funding versus other sources of funding.
As a result of the audit’s findings, the province has pulled its funding for the consumption site.
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