Sipekne'katik told it 'unjustly' fired director accused of stealing

Sipekne'katik First Nation in Indian Brook may be trying to improve its financial reputation, but a federally-appointed adjudicator has told the band it acted too quickly when it fired a director of post-secondary education accused of stealing.

The band is now going to court to challenge a Canada Labour Code Board decision that orders it to pay 18 months of salary to Jeanette Paul.

The allegations against Paul emerged as forensic investigators began to probe band finances in 2012, an audit that eventually found widespread financial mismanagement at the First Nation and poor government under the previous administration.

The band was also placed under a co-management arrangement involving accounting firm MNP LLP. During this period the co-manager, accountant Matthew Horton, grew suspicious of cheques that were being written for student expenses. 

According to a labour board decision obtained by CBC News, the band accuses Paul of bad record management, of writing cheques to herself, and of paying expenses for post-secondary students without documents showing they were even enrolled in a program.

Paul was fired in 2013, but challenged her dismissal and denies she stole money.

'Unjustly dismissed'

She claims, according to the decision, she had been told to "process stuff" without proper documentation and that living allowance payments she made to herself were approved by former chief Jerry Sack.

She also says the band cut off her access to computer records that would show the student payments, including some made to her daughter, were legitimate.

In a labour board ruling in March, adjudicator Peter Lederman sided with Paul, saying she was "unjustly dismissed."

The ruling says under previous administration, councillors and band officials routinely intervened in decisions about individual students. When third-party accountants were brought in to mop up the mismanagement, Paul was subjected to new "scrutiny and standards," but not given any help to adjust and understand them.

Sipekne'katik, however, is not happy with the decision and has gone to the Federal Court of Canada in a bid to have the decision overturned.

"The board erred in law and acted unreasonably in finding that Jeanette Paul was unjustly dismissed," says an application filed by the band.

Wanted in the U.S.

Paul has come under scrutiny before. She served as chief electoral officer in the 2006 band election, but refused to turn over the ballots to the Department of Indian Affairs and later destroyed some of them in the parking lot of the band office. She was eventually fined for mischief.

Paul is also wanted in Massachusetts, where she is accused of defrauding the state of more than $100,000 by claiming health and other benefits, even though it's alleged she didn't live there.

Paul could not be reached for comment. Nathan Sack, the band's director of operations, declined to comment, as did the band's lawyer, Ronald Pink.

The forensic audit into a wide range of band finances was ordered after about $800,000 went missing from Sipekne'katik coffers. The results have been turned over to the RCMP.

Two years ago, a councillor and a former band employee were charged with possession of the proceeds of crime.