Fraser to look at Yukon's $36.5M frozen investment

Federal Auditor General Sheila Fraser will conduct a special investigation into whether the Yukon governmentbroke anylaws in investing$36.5 million in public money into the now-frozen global credit market.

Liberal Opposition Leader Arthur Mitchell told reporters Tuesday that Fraser committed to the investigation in a letter sent to him, Premier Dennis Fentie and deputy finance minister David Hrycan. Fentie is also the Yukon's finance minister.

"In light of the significant amount of the investment, we will be reviewing this matter and reporting our findings in a separate report," Fraser wrote in her letter dated Tuesday.

Fraseradded she will release her findings to the Yukon legislative assembly early in 2008.

"We have felt all along that the government has pursued a risky policy," Mitchell said."We have felt all along that it is possible that the government may not have been in compliance with the Financial Administration Act.

"We referred the matter to the auditor general because of our concern. The auditor general feels that this is worth her looking into."

The Yukon government's $36.5-million investment has been sitting in the credit market since it froze in mid-August. The government, as well as other investors, are now trying to recover their money.

Critics, including the opposition Liberals and NDP, have accused Fentie of gambling with taxpayers' dollars in risky investments. But Fentie and Hrycan have both said the 30-day asset-backed commercial paper they had invested inis a low-risk investment.