Baillie questions law firm’s ‘preferential treatment’

Tory leader says Liberals paid firm to hand over audit evidence

Darrell Cole webcomments@ngnews.ca
Published on July 10, 2014
Jamie Baillie is questioning why CRDA's former legal counsel was given 'preferential treatment' by the province to secure evidence for a forensic audit of the organization.

Jamie Baillie is questioning why CRDA's former legal counsel was given 'preferential treatment' by the province to secure evidence for a forensic audit of the organization.

HALIFAX – Cumberland South MLA and Opposition Leader Jamie Baillie wants to know why the Liberals gave the Cumberland Regional Development Authority’s legal counsel preferential treatment as a creditor of the closed development authority.

In addition to highlighting almost $800,000 in false claims and questionable invoices, the CREDA audit, released this morning, reveals that the Liberals paid CREDA’s legal counsel, Hicks LeMoine of Amherst, an undisclosed amount of money to hand over crucial audit evidence.

“How much did the Liberals pay the firm and why?,” Baillie asks. “It brings into question, the competency of the Liberals. Why use taxpayers’ money to settle a claim that should have been handled the same as any other creditor?”

Baillie, a chartered accountant, says withholding key audit evidence is wrong and taxpayers deserve answers from the Liberals.

The Tory leader said the audit was finally released Thursday, more than a year overdue. According to the audit, the delay was the result of CRDA withholding crucial information including hard drives from its law firm.

He said the audit confirms the Liberals paid the firm on Feb. 11, 2014. This information would have been known to the Liberals when Baillie asked minister Michel Samson the same question in Question Period, but he refused to answer.

The audit, which has now been referred to the RCMP, finds significant gaps in controls at both CREDA and the provincial Department of Economic and Rural Development and Tourism.

“This troubling audit highlights the importance of competency and accountability for anyone who has oversight of public funds,” said Baillie. “It’s a disappointing day for the people of Cumberland County and for all those across the province who expect more from their government.”

Economic and Rural Development Minister Michel Samson said the audit began in January 2013 and everyone wanted answers to remove the cloud that was hanging over a lot of people.

He said the province paid the law firm $8,500 for providing legal services and did not consider it to be creditor of CRDA’s.

“This became an issue, the fact the hard drives had been given to the law firm on behalf of some of the employees. There was a question of the law firm reviewing this to determine if there were issues of solicitor-client privilege and other issues and there was a question of who was going to pay the cost of carrying out that responsibility by the law firm,” Samson said. “My staff and the department negotiated with the law firm because I was not prepared to see this process take any longer than it was taking. It was decided to pay the law firm $8,500 for their services in reviewing those hard drives in order for PricewaterhouseCoopers to continue their audit.”

Samson said he is surprised with Baillie’s accusation, adding the law firm was not looked at as a creditor but as a firm that had a duty to its client to review matters on the hard drive from a solicitor’s perspective.

“Once that was done they were prepared to turn those hard dirves over to PricewaterhouseCoopers for their review,” Samson said. “It was also work that was being done by the law firm as part of the wind down of CRDA.”

The minister said Baillie is not showing leadership is the message he gets from the 700-page report is an $8,500 payment to a law firm for legal services.

darrell.cole@tc.tc

Twitter: @ADNdarrell