A new board of directors has been elected by Tribal Councils Investment Group, and its controversial CEO, Allan McLeod, has been suspended.
Sources confirmed a special shareholder meeting today called specifically to wrestle control of the floundering investment firm owned by the seven Manitoba tribal councils succeeded in its goals.
Sources said McLeod, two other senior executives and the former chairman of the board, Frank Turner, were suspended with pay pending a review of the company’s financial affairs.
The accounting firm Lazer Grant has been retained to conduct the review.
The new board is made of seven members, one representative from each Manitoba tribal council. Glenn Hudson, chief of Peguis First Nation, was named chairman.
The old board included the CEO and an independent chairman.
TCIG was formed in the early 1990s as a way to generate economic development among the province’s First Nations.
Each of the seven tribal councils invested $25,000 and with the help of some early government assistance and some fortunate early investments — most significantly the Pepsi distributor for Northern Canada — the company started generating enough profits to be able to distribute about $100,000 in annual dividends to the seven tribal councils.
But a number of factors started to conspire against those lucrative returns, and profits turned into losses.
As the poor financial performance of the company was becoming evident, dissatisfaction was growing among the shareholders about management practises. But for various reasons, the former board of directors declined to take decisive action.
Concern started to be voiced in March 2010 when TCIG acquired a corporate jet.
The Free Press has reported TCIG was losing about $600,000 per year on the jet and McLeod was drawing a salary equal to that of CEOs of public companies 10 times the size of TCIG.