WE Charity founders say group ‘far from perfect,’ defend program launched while ‘scrambling’

The founders of the controversial WE Charity, Craig and Marc Kielburger, defended what they billed as the good intentions behind a sole-sourced contract for their group to administer a federal student service grant program worth nearly a billion dollars.

The two spoke Tuesday as part of House of Commons finance committee hearings into the WE Charity scandal, which is working to determine how an organization with close financial ties to prominent members of the government received a sole-sourced contract to run the Canada Student Service Grant.

READ MORE: WE Charity grant agreement planned to spend roughly half of promised amount, documents show

Administering that program would have seen the organization receive some $43 million.

It has already received roughly $30 million of that but says it will repay the amount in full.

The brothers said that money would be to cover expenses incurred in setting up the program and not as a benefit to themselves and their organization. They added that by returning the money they have received so far, the group will be out roughly $5 million.

“Some have suggested that WE Charity was in dire financial straits prior to the CSSG and that somehow motivated our actions. It simply isn’t true,” said Craig Kielburger.

“Because, like many Canadian nonprofits and businesses, we had already taken difficult actions to adjust staff numbers and pivot our programs to the new realities of COVID.”

READ MORE: A timeline of key events in the WE Charity, Trudeau controversy

Former WE board chair Michelle Douglas also testified Tuesday and said in her opening statement that WE co-founder Craig Kielburger asked her to resign on March 25 after she and other board members asked WE executives to hand over financial documents to justify mass layoffs during the coronavirus pandemic.

“I resigned because I could not do my job. I could not discharge my governance duties,” she said. “It was our view that you could not fire hundreds of people without very strong demonstrable evidence and even then should explore mitigation measures to save jobs.

“Instead, the executive team were dismissing employees with great speed, and in large numbers.”

She detailed a dramatic phone call on March 23 where she asked that WE executives turn over financial statements

“I demanded that the executive produce those records,” Douglas said. “I’ll simply say that the call was abruptly concluded.”

2:49 WE Charity controversy: Former WE Charity board chair says board ‘always understood’ speakers were not paid for WE Day

WE Charity controversy: Former WE Charity board chair says board ‘always understood’ speakers were not paid for WE Day

She also said it was understood by board members that “speakers were not paid by the charity or related organizations to speak at WE Days.”

That appears to stand in contrast to the reports in recent weeks that the WE Charity paid out hundreds of thousands of dollars in speaking fees to members of the Trudeau family.

Douglas, a former human-rights activist and former military member, also said that WE board members had concerns with the newly created WE Charity Foundation.

Global News first reported the CSSG agreement was with a separate entity called, WE Charity Foundation, which had only received charity status in 2019 and whose stated purpose was to “hold real estate.”

“The board was never satisfied that the operation of this foundation was in the best interest of the charity or its various stakeholders, to the best of my knowledge it was not in operation as of my departure from the board,” Douglas said.

“We didn’t have enough information,” she said. “Frankly thinking about all the youth who had done fundraising and wanted to understand in a matter that was crystal clear why such a foundation would exist.

“Ultimately there was no resolution.”

WE Charity has previously said it decided to make the Foundation the “contracting party” with the government on the advice of its lawyers due to concerns about legal liabilities stemming from the federal student program.

“The use of multiple corporate entities to isolate liabilities for particular projects is not uncommon,” the charity said in a statement.

© 2020 Global News, a division of Corus Entertainment Inc.

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