Federal whistleblower claims 'green slush fund' misappropriated $150 million in taxpayer dues

A federal whistleblower has blown the lid on allegations involving the misappropriation of taxpayer funds. Israr Ahmad, a former employee at Sustainable Development Technology Canada (SDTC), estimates the foundation misappropriated up to $150 million in public grants.

Federal whistleblower claims 'green slush fund' misappropriated $150 million in taxpayer dues
Website/ balsillieschool.ca, Facebook/ François-Philippe Champagne and Facebook/ Annette Verschuren
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A federal whistleblower has exposed another government scandal, alleging the misappropriation of taxpayer funds.

Israr Ahmad, a former employee at Sustainable Development Technology Canada (SDTC), told the Commons Industry Committee Monday that the ministry intended to replace the slush fund’s management, owing to what they described as a "board failure all-together."

In March, a whistleblower complaint revealed alleged breaches of conflict of interest and human resource deficiencies. In response, the federal government suspended all funding to the foundation on September 26.

Under its agreement with the Department of Innovation, Science, and Economic Development (ISED), the green fund had $1.6 billion to distribute to clean tech enterprises between 2021 and 2026.

However, a True North report uncovered the allocation of tens of millions of dollars to firms in which its board members are financially vested, including millions in COVID relief payments. 

Ahmad estimates that up to $150 million could have been granted improperly, reported the Globe and Mail.

In the following weeks, Industry Minister Francois-Philippe Champagne kept its senior management in place, despite knowing of its shortcomings as identified in a conflict-of-interest report published October 4. 

According to Ahmad, ministry officials changed tact and ordered them to complete a series of measures to improve its governance and financial practices. 

As of writing, the SDTC has completed its response to Champagne’s action plan but awaits the government’s approval. The whistleblower claims this amounts to a coverup.

Ahmad, who conducted investment and due diligence at the foundation from 2020 to 2022, can speak publicly on the SDTC as he is not bound by a non-disclosure agreement like other employees.

Champagne also hired McCarthy Tétrault LLP to review the SDTC’s human-resources practices, confirming that funding won’t resume until he is satisfied with their corrective actions. As part of that review, current and former employees have been invited to speak and the government has waived the terms of any nondisclosure agreements, reported the Globe.

Doug McConnachie, assistant deputy minister at the ISED, appeared before the House Ethics Committee last month where he alleged the whistleblower baited him into "making speculative and inappropriate remarks" about letting go SDTC officials.

On December 11, deputy minister Simon Kennedy said he could not testify on why McConnachie made those statements over more than 30 hours of conversations between bureaucrats.

Ahmad disputes this claim, suggesting a "definitive consensus" existed between the ISED and the Privy Council Office to fire the board and executive team at SDTC.

"This was described to us in detail on multiple occasions in late August and September," he said. "The outcome of the situation only changed when the minister’s office became involved, and he is ultimately responsible for SDTC."

"He’s the one who needs to tell the truth about what the real situation is," testified Ahmad before the industry committee.

Since the report, longtime CEO Leah Lawrence and board chair Annette Verschuren stepped down over the findings that they thoroughly dispute. 

Lawrence claimed "a sustained and malicious campaign to undermine" her leadership by the whistleblower forced her resignation.

Meanwhile, the Auditor General and federal Ethics Commission is investigating Verschuren’s role in approving $38 million in COVID relief funding to corporate partners, including a $217,000 grant to her money-losing battery company NRStor Incorporated.

Ahmad told MPs that Lawrence presided over a "toxic" workplace at the foundation where they let go of employees who questioned their procedures and investments. 

Within a two-year period, four human resources directors had their contracts terminated or went on a stress-related leave, according to testimony from the whistleblower.

"And every single one of them was put under an NDA which specifically had language that prevented them from even going to the federal government to complain about this issues that were ongoing," he said.

SDTC spokeswoman Janemary Banigan contested the testimony, which he says contained "very serious allegations […] which are either false or grossly misrepresented." He confirmed the foundation is cooperating "openly" and "transparently" with all third-party reviews underway.

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