The RCMP is investigating the finances of a tiny B.C. First Nation band used to enrich members of a single family to the tune of $4.2 million over 3½ years, according to a forensic audit obtained by Postmedia News.
The Shuswap First Nation’s transfers to the family, and payment for trips to Las Vegas and Cuba ended in November 2014, when the family was voted out of office after Postmedia’s disclosures.
In July, the federal government-funded Ernst & Young audit was provided to the 100 band members who live on the reserve on the outskirts of Invermere near the B.C.-Alberta border.
The 13-page report was also handed over to the Mounties.
“It is under RCMP investigation,” Chief Barbara Cote and her two councillors said in a recent written statement to members.
Despite the continuing police probe, the person who received the largest portion of the $4.2 million in 2011-14 is running in next month’s council election and could become chief.
Corruption in our political system — whether on or off reserve — can never be tolerated or overlooked
Dean Martin, son of former chief Paul Sam and former councillor Alice Sam (Paul Sam’s ex-wife), is one of the challengers going against the three incumbents, Cote, Tim Eugene and Rosalita Pascal.
Before the 2014 election, Martin, who boasted his parents deserved to be paid more than the prime minister because they served their “nation” longer than any Canadian leader, was chief executive officer of Kinbasket Development Corp., a band-owned company.
Martin, who could not be reached for comment, received just under $1.4 million between April, 2011, and November, 2014, according to the audit.
That amount, tax-free because Martin worked on-reserve, is the equivalent of $2.5 million if he had paid income taxes, according to the Canadian Taxpayers Federation.
Paul Sam, who was in his 80s and confined to a wheelchair, got $741,262, the equivalent of $1.3 million, while Alice Sam, who served as the band’s bookkeeper, got $690,481, or just over $1.2 million.
There was “general and widespread lack of supporting documentation,” Ernst & Young concluded in the July audit, noting inadequate proof that expenditures were reviewed to ascertain the business purpose of the transaction.
The audit, sent anonymously to Postmedia by a “concerned band member,” showed two private companies — Shuswap Woodlands Restoration and KDC Sand & Gravel — received another $1.36 million in undocumented funds.
SWR is owned by Dean Martin’s son, Robert, while KDC Sand & Gravel is owned by his other son, Richard.
Another $66,481 was spent during the period “on flights to destinations such as Las Vegas, Chicago and Varadero, Cuba for travel of an apparent personal nature,” Ernst & Young stated.
The audit also discovered two $15,000 amounts were “diverted” to pay the credit card debts of Dean and Richard Martin.
Another $20,000 went to pay down the line of credit of Pam Martin, Dean Martin’s former wife, while $28,000 covered travel and accommodation for a softball team.”
Canadian Taxpayers Federation spokesman Jordan Bateman said Martin has an unfair advantage in trying to win back control of the band council in the Nov. 8 election.
“Mr. Martin has hundreds of thousands of dollars to spend on his campaign and to woo the very small Shuswap electorate,” he said Friday.
“It’s unlikely any of his opponents have those kind of resources. Hopefully, voters get access to the full information about how their council has been run and change things.”
Bateman urged the RCMP to devote sufficient resources to complete a full investigation.
“Corruption in our political system — whether on or off reserve — can never be tolerated or overlooked, as integrity is foundational to democracy,” he said.
Shuswap members “deserve to know exactly what has gone on with their band leadership and millions of their dollars.”
The salaries to the Sam-Martin family only became public, and the family ousted, after Postmedia’s disclosure of the band’s finances as reported under the First Nations Financial Transparency Act.
Among the band’s contingent liabilities, according to its 2015-16 financial statements, is a $211,333 loan taken out by KDC Sand & Gravel. The band is also involved in litigation with ex-employees, including Dean Martin.
The Trudeau government is no longer enforcing that Conservative legislation, saying the law wasn’t brought in with adequate consultation with First Nations.