A suit filed in B.C. Supreme Court claims a former University of British Columbia associate dean of dentistry siphoned millions of dollars away from clinics set up to serve First Nations patients in Haida Gwaii.
Canada's attorney general is suing Christopher Zed and the university for fraud and negligence in connection with money Health Canada gave UBC to provide dental services in Skidegate and Old Massett Village.
The government claims it was overbilled by $3.3 million from April 2002 to September 2013; the suit claims $2 million worth of patient billings were allegedly diverted to bank accounts controlled by the dentist.
"Dr. Zed's spending behaviour contravened the most basic expectations of an official entrusted to manage the Haida Dental Project for the benefit of marginalized and vulnerable communities," the statement of claim says.
According to the lawsuit Zed worked in various capacities during his tenure at UBC, receiving attention for providing dental care to athletes at the 2010 Winter Olympics. He is from a well-known New Brunswick family, and is the brother of former Liberal MP Paul Zed.
The suit claims he was dismissed in 2013, when he was associate dean of strategic and external affairs with the faculty of dentistry.
Health Canada claims it entered into several contracts with the university to provide dental care to First Nations residents in Haida Gwaii who weren't covered by provincial health benefits or private insurance.
In addition to paying for dental services, supplies and travel incurred by UBC, Ottawa fully funded and equipped two dental clinics in Skidegate and Old Massett Village.
But according to the statement of claim, UBC contacted Health Canada in November 2013 to say "it had concerns regarding the financial operations of the Haida Dental Project."
The university "believed that Canada had been over-billed for salaries related to dental residents, administrative services and hygienist services."
It's alleged revenues for third-party billings for patients not covered by the program may also have been used improperly.
The federal government claims UBC didn't provide the details of its investigation until March 2015, almost a year after it was completed.
'Abused his position of trust'
The "heavily redacted" report allegedly found "Dr. Zed had abused his position of trust at UBC and through complex and deceptive activities transferred public funds from Canada for his personal benefit and hid $5.1 million of spending from UBC's conclusive analysis."
The lawsuit claims the government gave UBC a total of $10.6 million for the project.
The university's analysis allegedly found that $1.6 million had been mismanaged and transferred to other UBC accounts in the faculty of dentistry, including programs Zed oversaw.
Another $1.2 million in unexplained deposits was allegedly made to Zed's personal bank account. And $221,000 in credit card payments allegedly went to his UBC American Express card for travel and entertainment.
The attorney general is suing UBC for breaching its obligations to provide benefits according to the Haida dental project contracts. The lawsuit claims UBC and Zed are also liable for deceit and fraud.
UBC would not comment, saying they had not yet been served with the claim. A spokesperson for B.C.'s College of Dental Surgeons said the college is aware of the allegations.
Zed could not be reached for comment. He is currently practising at a dental clinic in East Vancouver.
None of the allegations have been proved in court.