NEWS

$31K in legal bills hidden from Samra’s expenses

Chief financial officer Victor Mema told staff to exclude lawyer fees from city manager’s public spending reports
Tracy Samra and Victor Mema
Almost $31,000 in fees paid to the firm of city manager Tracy Samra’s personal lawyer were hidden from the public, News Nanaimo can disclose.

Chief financial officer Victor Mema instructed city staff to go against prior practice and not include the fees in the city manager’s published expense reports, city officials confirmed.

Mr. Mema, who himself had unreported expenses, is currently suspended from his duties pending an investigation into what the city says is “an allegation of significant concern.”

Ms. Samra is on unspecified paid leave and expected to appear in court April 10 related to allegations of threats being uttered during an incident on Jan. 31 at City Hall.

By failing to include the legal expenses in published expense reports the true scale of Ms. Samra’s spending was grossly under-reported and local media published inaccurate reports.

At the time that Mr. Mema issued his instructions not to report the legal expenses both he and Ms. Samra were under pressure over their spending on travel, meals and other expenses.

They were also refusing to disclose their credit card statements while the city’s regular quarterly management expenses report was being delayed.

On Feb. 2, the city finally published the expense report for the period from January to the end of September last year but the disclosed amounts excluded Ms. Samra’s legal expenses.

Tracy Samra's q3 20017 expense showed she had no legal expenses
No legal fees were reported on Ms. Samra’s third-quarter 20017 expenses statement

The published report showed that Ms. Samra had no legal bills and total expenses of just $5,947, which one local news outlet said was “well under her $19,530 budget” for the year.

However, with her legal expenses included Ms. Samra’s expenses would actually have been closer to $36,800, or more than 88% over her total expense budget for the year.

Ms. Samra is believed to be the only senior manager at the city to ever be granted an allowance for a personal lawyer.

Payments shown to nonexistent firm

The city disclosed Ms. Samra’s legal expenses in response to a freedom of information request by News Nanaimo.

The information the city provided shows that Vancouver-based Boughton Law., the law firm of Ms. Samra’s personal lawyer George Cadman, was paid $27,847.02 in 2017.

A separate entry showed that a “Broughton Law Corporation” received $3,009.55 last year.

However, News Nanaimo has established that there is no law firm of that name in Canada.

Payments to the nonexistent “Broughton Law Corporation” first appeared in the city’s report on Ms. Samra’s expenses for the first six months of 2017. In that report, published last September, $760.77 was shown as having been paid.

When the subsequent third-quarter expense report was published in February, that payment had been removed.

Records obtained though FOI show payment to nonexistent firm Broughton Law Corporation.
Records provided by the city showed $3,009.55 paid to Broughton Law Corporation, which does not exist. The city later clarified that this was an error and Boughton and Broughton are the same entity.

Asked about the apparent creation of a vendor profile for a nonexistent company in the city’s accounting system, the city said there was an “error” and that “Broughton Law Corporation” and Boughton Law were the same entity.

The city further confirmed that the $3,009.55 had been paid to the real Boughton Law, bringing the total received by the firm of Ms. Samra’s personal lawyer to $30,856.57 in 2017.

The amounts were paid on Ms. Samra’s behalf and would have been reflected on Ms. Samra’s expenses statement if not for Mr. Mema’s instructions, city officials said.

Approved by council majority

It’s understood that some or all of Ms. Samra’s legal expenses were approved at closed-door meetings by the five-man council majority of Bill Bestwick, Jim Kipp, Jerry Hong, Gord Fuller and Bill Yoachim.

At least part of the fees are believed to have been for legal advice related to Ms. Samra’s complaint and potential claim against the city for alleged breaches of the respectful workplace policy by mayor Bill McKay, councillor Diane Brennan and former councillor Wendy Pratt.

An investigation into those allegations by labour lawyer Roslyn Goldner, who reportedly found there was no bullying or harassment of Ms. Samra, cost taxpayers at least $26,150.

Ms. Samra first hired Mr. Cadman to represent her when the legality of her hiring as interim city manager in November 2015 was questioned by a lawyer acting for Ms. Brennan. The lawyer asked the mayor to suspend Ms. Samra pending an independent investigation.

At an in-camera meeting in December 2015, councillors voted to give themselves and Ms. Samra $5,000 each for “independent legal advice” in response to Ms. Brennan’s legal letters. At some point Ms. Samra’s allowance was raised to $10,000.

Ms. Samra hired Mr. Cadman while councillors Bestwick, Kipp, Hong, Fuller and Yoachim hired Victoria law firm Cook Roberts at a cost to taxpayers of $18,334, according to expense reports.

In 2016, the city disclosed Ms. Samra’s legal expenses to Boughton Law in a published expense report (PDF). It showed that she spent $8,454.28 with Mr. Cadman’s firm that year.

In total, taxpayers have paid Mr. Cadman’s firm $39,310.85 over two years on the city manager’s behalf.

The city disclosed payments to George Cadman's firm in Ms. Samra's 2016 expenses report
The city disclosed payments to George Cadman’s firm in Ms. Samra’s 2016 expenses report

The five councillors have never disclosed why they needed personal legal advice related to the circumstances of Ms. Samra’s hiring.

After receiving the letter from Ms. Brennan’s lawyer Mr. McKay sought advice from the provincial ministry responsible for municipalities, which was headed at the time by former Liberal minister Peter Fassbender.

In February 2016, Ms. Samra accompanied Mr. Cadman to Mr. Fassbender’s annual campaign fundraiser during a trip that she expensed to taxpayers.

Both Mr. Fassbender and Ms. Samra have previously said they never discussed the controversy over her hiring when they met.

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  • It just gets worse and worse. At this point almost nothing is a surprise. I wonder what Councillor “If Ms Samra says so, it’s OK with us” Hong has to say.

  • Did this council know about these expenses a) being incurred by Samra? b) did this council approve them to be paid and expensed as a city expense for her? and c) did this council know that these expenses were NOT reported on her expenses report? If the last question is answered yes, and I suspect it is the case then what was stopping a councillor/mayor who may have voted against approvals to disclose this to the voting public? Oh, I know…. in camera personnel shit right? WRONG!!!!! You folks should really stop to think that when someone is doing something illegal or in effect committing fraud on the taxpayers and public you CANNOT hide behind this stupid confidential/personnel excuse for not exposing such a bunch of crap. In my mind you are becoming an accessory to such activities. If this indeed happened I have no words to express how chickenshit these people have become.

    • think can and does happen with the threat of legal intimidation hanging over ones head… i wonder if that was the case here??

  • If one is not already under way, and if the Bestwick brigade has not tried to block one, there now has to be a criminal investigation. And where was the man who would be king himself, head of the finance and audit committee, as this went on under his watch? Only two choices: Shocking negligence or complicity. For his sake, the former is the best of a devil’s choice. His name and reputation are ruined in Nanaimo regardless. But being party to an alleged fraud of this nature would be stunning, even by Nanaimo standards.

  • Why are these two suspended ‘with pay’? Given the seriousness of the circumstances/allegations, suspension should be ‘without pay’.

  • thanks dominic… this seems like a key statement in your post – “The five councillors have never disclosed why they needed personal legal advice related to the circumstances of Ms. Samra’s hiring.”

  • Just when you thought this couldn’t possibly get worse! What else hasn’t been “uncovered” yet? A full forensic audit should be conducted. A non existant law firm – are you kidding! What is being covered up?

    Samra and Mema are both being paid and will undoubtedly stretch out their “sick” time as long as possible. It’s just wrong on every level.

  • More than 24 hours after it’s reported on Newsnanaimo that the top two city bureaucrats were doing something dubious, nothing on the websites of other local media. Crickets. Not a surprise with Black(out) Press, really. But no Times Colonist, no radio, no TV. This is the state of journalism today; unless it’s enshrined in an official press release or will appeal to advertisers, it just ain’t a story that most news outlets will risk running. And even if it’s spread around on social media, no one cares as they move on to the next titillating bit of gossip. And why do you think this happened in the first place? One factor is that they thought no one was watching and could get away with it. Just remember, as local media either fails to or is unable to act as a watchdog that nothing good happens in secret. And there’s now an awful lot of secrecy going at every level of government. Pretty soon we’ll have to sign NDAs just to read Hansard!

    • These are not normal circumstances. The other media have to file FOI requests like I did and then ask informed questions. The city is in a position where it will only provide information where the Freedom of Information and Protection of Privacy Act provides the necessary legal support for disclosure. This protocol is in place to protect the taxpayers of the city from potential litigation. Everything now being released is being put through a rigorous legal review. That’s why you are not seeing others immediately following.

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