Gilbert Plains sues former CAO, alleging $500K fraud

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This article was published 01/08/2023 (772 days ago), so information in it may no longer be current.

A Manitoba rural municipality is suing its former chief administrative officer, alleging she pilfered more than a half-million dollars from its coffers, made up a story about a cyber attack and modified fiscal documents to cover her tracks.

Winnipeg-based law firm MLT Aikins filed two lawsuits July 25 on behalf of the Municipality of Gilbert Plains in the Court of King’s Bench, alleging the municipality’s former CAO, Amber Fisher, made repeated unauthorized fund transfers in 2020-21.

Fisher, who was fired after the alleged fraud came to the attention of local officials, is accused in the court papers of making 33 electronic transfers of $15,660.75 from the municipality’s account to her own over the course of about 11 months, for a total of $516,804.75.

The municipality is also suing a number of insurance firms it has filed claims with, seeking compensation. The documents say Gilbert Plains was insured for theft and fraud.

Neither Fisher nor the insurance companies have filed statements of defence. The allegations have not been heard in court.

“It’s been stressful, I’ve been dealing with the concerns of the ratepayers — that’s why I’m in this position, to look after that,” Gilbert Plains Reeve Jim Manchur said Tuesday.

The lawsuit against Fisher is seeking repayment of the allegedly stolen money, plus damages and court costs.

The action against the insurance companies is a precautionary move, Manchur said, as the legal deadline to file a suit in case the municipality’s insurance claims aren’t paid out is fast approaching.

In November, the municipality (located 360 kilometres northwest of Winnipeg, with a population of roughly 1,600) sent out a letter to residents explaining the situation. Dauphin RCMP opened an investigation into the alleged fraud Nov. 9, 2022, after Gilbert Plains officials brought the results of a third-party audit to the detachment’s attention.

Manitoba RCMP spokesman Sgt. Paul Manaigre said Tuesday the force’s criminal fraud investigation is “very much ongoing.” Provincial court records suggest Fisher has not been charged criminally.

Manchur said he has been in regular contact with Mounties.

“My primary focus is to recover the monies, whether we do that on a lawsuit basis with the individual or through our insurance, and we have a fairly strong insurance policy that should cover the bulk of it,” the reeve said.

According to the court papers, Fisher, who lives in Grandview, was hired as senior administrative officer in June 2018. She was promoted to CAO in April 2020.

On July 28, 2021, Fusion Credit Union notified Gilbert Plains officials of “substantial outflows” from the municipality’s bank account to an account at another credit union in Fisher’s name, the statement of claim says.

The municipality suspended Fisher on Aug. 3, 2021, as it investigated. She allegedly told the municipal council she was the victim of a “cyber attack,” and officials began a fraud investigation.

Gilbert Plains reinstated Fisher on about Aug. 10, and she returned to work the next day.

Later that year, the court documents say, the municipality’s auditors requested Fisher’s bank statements multiple times for the 2020 fiscal year audit, before saying they would request the statements directly from the credit union.

In March 2022, the court papers allege, she provided auditors with modified bank statements. In the weeks following, she provided the municipality with a draft fraud examination report, dated March 31, purportedly authored by a third party.

“The draft fraud examination report cleared Fisher of any fraudulent activity,” the statement of claim reads.

Gilbert Plains auditors met with the municipal council May 10, 2022, to express concerns, before the council had a virtual meeting with the purported author of the fraud report.

On May 24, 2022, a municipal employee alerted the council of suspicious payroll payments. Fisher was suspended that week.

In June 2022, Fisher submitted the final fraud report, purportedly written by the same person as the draft. That report also cleared her of any wrongdoing.

However, the municipality called third-party auditor MNP to “investigate their concerns that Fisher may have received excess payments” without authorization June 3, before she was placed on paid leave in July.

MNP prepared a forensic accounting and finance investigation report for Nov. 10, concluding Fisher had made the unauthorized transfers, the lawsuit says. Fisher was then fired with cause.

The court documents say Fisher has repaid the municipality $16,900.

Manchur said the financial loss, although significant, did not impact major municipal projects, as it had strong financial reserves.

The reeve added the municipality, which has hired a new CAO and assistant CAO, has since put in place new oversight on all financial matters.

“Any financial transactions, money going out, is reviewed by a number of people: admin staff, a minimum of two council members… I firmly believe now that it would not happen again in our municipality.”

erik.pindera@freepress.mb.ca