Auditor general's office fires 2 staff members for earning money from government contracts

The auditor general's office has fired two of its employees after learning they were earning money from Government of Canada contracts on the side.

"The employees did not disclose this information to their managers. None of the employees involved were auditors," said a statement from the Office of the Auditor General (OAG).

"In two cases, an investigation was conducted, and the employees no longer work for the OAG."

The OAG confirmed that a third employee is also being investigated in relation to outside work.

As first reported by the National Post, the investigations led the OAG to revoke the employees' security clearances and then terminate their employment.

Both cases were first referred to the RCMP in early January 2024. On the advice of the Mounties, the OAG referred them to the Ottawa Police Service the following month.

The OAG said it will not comment further on the case of the third employee because it remains under investigation.

The OAG said the now-former employees did not have any outside contracts with the OAG and that it will not be disclosing the names of the companies with which they were involved.

The OAG said it will be rolling out additional ethics training for employees in the coming months and will ensure that, going forward, additional controls are "implemented to verify outside employment or contracts."

The OAG's code of conduct

According to the OAG's code of conduct, employees of the agency are allowed to engage in work outside the office providing that work does not undermine the neutrality of the OAG or violate the agency's conflict of interest rules.

Those rules say employees who are concerned that their relationships or connections with "existing or potential contractors" with the agency could "result in a real, apparent or potential conflict of interest" must declare that risk to the OAG's internal specialist on values and ethics.

If the specialist decides the outside work does not violate the agency's code, they will consult with the employee's manager to provide written approval for the activity.

The rules also state that employment "either directly or on behalf of an external third party contracting with the government is considered to give rise to a conflict of interest unless the contrary can be established by the employee."

ArriveCan and Dalian Enterprise

In February, Auditor General Karen Hogan delivered a highly critical report on the costs of developing the ArriveCan app. She concluded that spending on the app increased dramatically because of the government's over-reliance on outside contractors.

That report revealed that one of the contractors, Dalian Enterprise, had received $7.9 million for its work on the app as of last March.

It later emerged that Dalian's president and founder, David Yeo, is also an employee of the Department of National Defence (DND). The company says Yeo only became a public servant after the project was completed.

The company has received more than $200 million in government contracts since 2015, according to a CBC News analysis of documents tabled in the House of Commons in January.

The documents were filed in response to an order paper question from Conservative MP Dan Muys. They list the contracts awarded to Dalian from each government department between November 2015 and November 2023.

Asked about the OAG and ArriveCan revelations in Calgary Wednesday, Prime Minister Justin Trudeau said Canadians should be able to expect that politicians and public servants will be "responsible and efficient stewards of taxpayer dollars."

"This is an unacceptable situation," Trudeau said. "What we've seen in terms of the procurement process that's ongoing within government, there need to be significant changes. 

"That's why there are ongoing investigations and that's why we will be making changes."