Whistleblower accuses Liberals of 'egregious coverup' over controversy at green tech fund

A former Sustainable Development Technology Canada employee accused the agency of mismanaging taxpayer money and misconduct by senior officials

Article content

OTTAWA – In bombshell testimony at a House of Commons committee, a whistleblower accused the federal government of an “egregious coverup” over allegations of mismanagement and misconduct conducted by the board of Canada’s main funding agency for green tech.

The whistleblower, a former employee who worked at Sustainable Development Technology Canada (SDTC) from 2020 to 2022, showed his face during his testimony at the committee on industry Monday night, but on the condition that his name would not be used.

Advertisement 2

Article content

Article content

“The SDTC board executives and senior management must be held accountable for their gross mismanagement of taxpayer money and the gross misconduct that’s been perpetrated by the toxic senior management team that has victimized countless employees,” he said.

“And the federal government must also be held accountable for its embarrassing lack of oversight that’s allowed these problems to persist, and its egregious coverup of the truth that occurred this fall,” he added.

During his time at SDTC, the whistleblower conducted financial due diligence and compliance of projects. He said he is the only one who could openly speak about the problems at the agency, since he had not signed a non-disclosure agreement, unlike many of his former colleagues.

He alleged that $150 million of taxpayer money was granted improperly, including to companies directly connected to SDTC’s own board members.

Industry Minister Francois-Philippe Champagne had previously said that his department was made aware of allegations concerning SDTC earlier this year, and had asked an independent third party, the accounting firm Raymond Chabot Grant Thornton, to conduct a “fact-finding exercise.”

Advertisement 3

Article content

Champagne said the contract was issued on March 17 and he received their findings on Sept. 27. He said the report found “no clear evidence of wilful misconduct,” but identified a number of “inconsistencies and opportunities for improvement.”

The findings, as reported by the Globe and Mail, showed evidence of inappropriate funding, conflict-of-interest breaches, high turnover rates and stress-related leaves of absence.

As a result, Champagne demanded that SDTC take corrective measures, including creating an action plan that he expects will be implemented by the end of this year and suspending government funding for all new projects until the corrective measures are in place.

Related Stories

But the whistleblower alleged that senior officials at Innovation, Science and Economic Development Canada (ISED) and Champagne’s office became more involved in the process before Raymond Chabot Grant Thornton’s report landed on their desks.

Advertisement 4

Article content

The whistleblower alleged that by June, after conversations with the minister’s office, the report was not a “fact-finding exercise” but rather an “investigation.” And while it was his understanding that the entire board would be replaced, that also changed, allegedly after Champagne’s intervention.

“The real truth of the matter is there was a definitive consensus across the bureaucracy at both ISED and PCO (Privy Council Office) that the full board and executive team at SDTC needed to be terminated,” he told MPs.

“This was described to us in detail and on multiple occasions in late August and September,” he added, referring to recorded conversations with a top ISED official. “The outcome of the situation only changed when the minister’s office became involved.”

CBC News revealed that the assistant deputy minister at Innovation, Doug McConnachie, was caught on tape criticizing senior management at SDTC on Aug. 25 and predicting that the minister would “flip out” when he was briefed on the report and would want “an extreme reaction, like shut it all down.”

McConnachie later told the ethics committee that it was a “false narrative” and that he was “baited into making these speculative and inappropriate remarks” over 30 hours of conversation with the whistleblower, which were recorded without his knowledge.

Advertisement 5

Article content

On Tuesday, Champagne insisted that he respected “due process” and blasted the whistleblower for doubting the integrity of Raymond Chabot Grant Thornton’s work.

“For people to question the integrity of one of the largest accounting firms in the world, I think, is ludicrous, to be honest,” he told reporters on his way to a cabinet meeting. “People are entitled to their opinions, but they’re not entitled to their facts.”

Champagne has since ordered another investigation, this time into “allegations of workplace misconduct” by the law firm McCarthy Tétrault before it decides if the green fund can resume distributing funds to companies in the clean tech sector.

The whistleblower described this new investigation as a “farce” and accused the firm of having broken confidentiality by showing all the names of the participants to SDTC executives.

This testimony is the latest in a series of developments concerning the fate of SDTC, which has put more than $1.5 billion into clean technology companies since 2001. The Conservatives have already said they would shut down the fund if they form government.

Advertisement 6

Article content

The president of the board of directors, Annette Verschuren, recently resigned after being the subject of an investigation by the ethics commissioner. She admitted to having approved more than $200,000 in subsidies to the company NRStor, which she runs.

The president and CEO of SDTC, Leah Lawrence, also resigned. In a letter to the board of directors, she cited a “sustained and malicious campaign to undermine” her leadership.

Our website is the place for the latest breaking news, exclusive scoops, longreads and provocative commentary. Please bookmark nationalpost.com and sign up for our politics newsletter, First Reading, here.

Article content