An accountant who was hired in 2009 to help the Sipekne’katik Band prepare an overdue audit said his employment contract ended abruptly shortly after he informed several band councillors about irregular activity with a dormant band-owned bank account.
Shawn Fitzgerald, 48, who worked with the Sipekne’katik Band in Nova Scotia from September 2009 until August 2010, testified Wednesday via video conference from Cape Dorset, Nunavut in the jury trial of Jeffery Cecil Hayes.
Hayes, 61, is charged with theft over $5,000, fraud over $5,000, breach of trust and four counts of possession of property obtained through crime. He is alleged to have committed the crimes while he was the Director of Finance for the Sipekne’katik Band.
Fitzgerald, a crown witness, told the court that he was reconciling the band’s bank statements when he noticed a large deposit of money was placed in an account that was normally dormant.
“I had to call the bank to get a copy of the deposit,” Fitzgerald testified during questioning by Crown attorney Rick Hartlen. He said he learned the cheque, which was in the six-figures, came from Loblaws, a national supermarket chain.
“So I called Loblaws,” Fitzgerald said. “I confirmed it was some sort of rebate,” he said.
Fitzgerald told the court he also noticed that money was also going out of the same dormant account. He said he noted a handwritten cheque was made out to MRJJ.
“I don’t recall the amount of the cheque but it was substantial,” Fitzgerald testified.
“I wanted to make sure they were aware.” – Shawn Fitzgerald
Once Fitzgerald learned about the irregular activity, he met with several Sipekne’katik band councillors to inform them of the situation.
“I wanted to make sure they were aware. I’m not sure why the band had chosen to pay an additional cost upfront and then receive a rebate later,” he testified.
“After the meeting, one of the councillors began asking for copies of cheques like this,” Fitzgerald explained. “ Transactions, listings and I provided them with what they were requesting.”
Fitzgerald testified that in the days following his meeting with band councillors, he felt uncomfortable working at the band office in Indian Brook First Nation.
“I felt a lot of tension,” he told the court.
“I know the RCMP came around to ask questions. At some point soon after in early August, I was called into Jeff’s office and Jeff told me that council no longer required my services and I was escorted out of the building,” Fitzgerald said.
Fitzgerald also testified that in April 2010, he noticed that monthly financial reports being submitted online to Indigenous and Northern Affairs Canada contained errors. He said the reports also showed the band having a surplus even though he knew the band had a deficit of more than $1-million.
“I don’t see how the band got from a significant deficit into this surplus position,” Fitzgerald said.
Under cross examination by defence lawyer Luke Craggs, Fitzgerald said he did not go to then chief, Jerry F. Sack or Hayes with his concerns about the dormant account activity before approaching band councillors.
However, on re-examination with Hartlen, Fitzgerald explained why he chose to meet first with the band councillors instead of Sack and Hayes.
“I didn’t trust them. The cheque looked questionable,” he said.
The trial continues on Thursday.
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