Forensic audit sought as furor divides Wabana council

Theres a chill in the air on Bell Island, and its not just related to the approach of winter.

A deep fracture has opened up among members of the Wabana town council and some of its employees.

The raging dispute is pitting longtime Mayor Gary Gosine and his supporters against two other outspoken members of council, David Foley and Ben Warford.

There are accusations of harassment, demands for resignations and police investigations, threats of legal action, and even one alleged incident of trespassing.

Foley and Warford are also raising questions about management of the towns finances, and have called repeatedly for a forensic audit to investigate what they call suspicious behaviour.

Caught in the middle are town employees, including a recently suspended part-time accounts receivable clerk, William Peddle, who is alleging favouritism and political interference by Gosine and his supporters, and harassment from fellow employees.

Warford says mayor should resign

Leadership is an issue in our town, said Warford. Its my belief that Mayor Gosine must resign.

If you dont have good leadership, youre in trouble, and were in big trouble.- Wabana Coun. David Foley

If you dont have good leadership, youre in trouble, and were in big trouble, added Foley.

Gosine, however, sees it differently. He calls Foley and Warford two radicals.

Gosine said he and three other members of council Deputy Mayor Carol Brown and councillors Donovan Taplin and Linda Skehans get along well, while these two people are slowing down the process.

There is one vacant seat on council, with a byelection scheduled for Dec. 16.

Review of town completed

Gosine said a review completed last week by the Department of Municipal Affairs is proof that the town is on solid ground.

I would rate it as an A report.- Wabana Mayor Gary Gosine

I can say its got a clean bill of health with a couple of small repercussions, Gosine said of the report.

I would rate it as an A report.

The mayor would not provide a copy of the report, saying it had not yet been adopted by council.

Late Monday, Municipal Affairs Minister Keith Hutchings said the report found "nothing significant with regards to the overall operations and administration of the town."

There were seven recommendations relating to, among other things, council motions, the monthly reconciliation of bank accounts and the re-establishment of council committees.

"There were no irregularities that would make me want to consider any further action at this time," said Hutchings.

Auditors findings

The call by two councillors for a forensic audit, meanwhile, stemmed from an independent audit of the towns 2013 statements by Coombs and Associates, which highlighted several shortcomings.

An Aug. 15 draft version of a letter from the auditor found that of 40 receipts tested, we could not agree 10 samples to the bank statements.

Roger Coombs, who carried out the audit, saidthe findings are not necessarily evidence of fraud, but more likely a result of bank reconciliations not being done on a timely basis.

It may be procedural, he said, adding there was only so much we can do with what he called an unqualified report.

Foley and Warford moved a motion to launch a forensic audit, but it was defeated.

If this money is not being deposited, whats going on here? Foley asked.

Foley said the results of that small audited sample raise questions. He said he worries about the true extent of any problem, in a town with an annual budget of nearly $2.5 million.

He said he believes a forensic audit is the only way to know for sure.

Gosine doesnt agree.

I dont think when its all found theres anything coming out of it, said Gosine, adding the town is investing in new financial management software to address some of the problems identified by the auditors.

Foley and Warford have also raised concerns about what they call credit notes, noting that tax breaks are being granted to those in arrears without a vote of council.

Warford said the town faces bankruptcy if these and other practices continue.

When asked about credit notes and allegations of favourtism in efforts to collect taxes, Gosine said the stuff they gave you is false information and does not make any sense.

Gosine also refuted suggestions he received tax breaks, saying Im just an ordinary citizen. Whatever I have to pay, I pay.

Employees caught in the middle

William Peddle, Wabanas suspended part-time accounts receivable clerk, said his problems began when he started asking questions, and was shunned by fellow employees and some members of council.

Peddle said he was suspended by another employee in the office after he refused to turn over a tax collection report he had compiled. Peddle said the clerk wanted to edit the report before issuing it to council members, and he was told he could not attend a council meeting at which the report was being discussed.

I said I would not supply a report to you to be edited and sent to the town without me at the meeting, Peddle told CBC Investigates.

Im not doing it.

Peddle was one of two tax clerks hired by the town earlier this year in a bid to collect what he estimates is more than $1.5 million in outstanding taxes.

He said he experienced interference from Day 1.

On one occasion, he said he sent a list of 60 water shut-off notices to council for approval, but it was reduced to six.

"Out of those 60, there were several that belonged to relatives of town council members, Peddle alleged.

Peddle said there were instances where he stood fast on efforts to collect the principal owing on taxes, but later discovered substantial discounts were granted.

When he inquired, he said, his questions went unanswered.

He also dropped a bombshell, alleging Gosine received a substantial discount on his taxes. The mayor flatly denies that allegation.

Gosine said the town clerk was within her rights to suspend Peddle, and the town got a legal opinion confirming that.

The mayor again denied there is favouritism.

People in the town see us as being totally honest and upfront with the people, the mayor said.

Meanwhile, two other office employees have retained a lawyer to probe what they allege is harassment from Foley and Warford, and a unionized public works employee has also lodged a complaint against Foley, alleging he trespassed on his property.

Warford said theres no harassment as far as Coun. Foley and I are concerned.

Warford said the allegations are a distraction from the real problems plaguing the town.

(The minister) needs to call a police investigation and he needs to call for a forensic audit, Warford stated.

Police called to town office

Police have been called to the town hall on several occasions in recent months.

All sides agree the contempt and hostility has created a harmful work environment at the council office, and the tension and division is apparent at each and every meeting.

The public gallery was full for the most recent town council meeting, and another large crowd is anticipated during Tuesdays meeting, which begins at 6 p.m.

Id like to believe the people elected can still run the town together.- Coun. DonovanTaplin

Times lately have been dark and challenging, said Coun. Donovan Taplin.

Taplin, 20, is the youngest member of council.

Hes hoping the results of the review by Municipal Affairs will help guide the town in a positive direction.

Id like to believe the people elected can still run the town together, said Taplin, who is a third-year communications student at Memorial University.

Taplin referenced what he called destructive behaviour by some members of council, and said he has not witnessed any favouritism.

He also expressed confidence in Gosines leadership.

I believe he has knowledge and insight that is very valuable to our council, said Taplin.