A forensic auditor says Dawson City's former mayor and other administrators mismanaged the town into financial chaos – and wants them to repay $200,000 into municipal coffers.

CBC News has learned that auditor Ian Doddington's report documents millions of dollars in mismanaged projects and hundreds of thousands of dollars in unauthorized spending.

The report singles out three former officials – former mayor Glen Everitt and the community's chief administrative officer and treasurer.




The audit was commissioned by Yukon's territorial government, which fired Everitt and the rest of Dawson City's council in April 2004 after details of financial problems started to emerge.

The firings were spurred by the revelation a few months earlier that the town was facing a $1.4-million cash shortfall and carrying a long-term debt of $4.4 million, which is beyond the maximum limit set out in the Municipal Act.

The town has been run by a territorial administrator ever since.

Mayor racked up $318,000 on city credit card: audit

Dawson City's problems go back to the late 1990s, when it took on a number of expensive projects, including a new swimming pool, cable television system and refurbished recreation centre.

Doddington says in his report that the former mayor, chief administrative officer and treasurer went to great lengths to keep councillors in the dark about all financial matters – including millions of dollars in contracts for the new town facilities that went wildly over budget with little or no accurate reporting to council.

His audit found that at times, documents were shredded and computer hard-drives were erased.

The six-year spending spree ended about one year ago, at which time the mayor's credit-card charges on the public tab totalled $318,000, Doddington's report said.

In examining Everitt's spending, the auditor found:

  • A third of the credit-card debt – just over $100,000 – consisted of cash withdrawals.
  • A $2,800 claim for a bar bill in 1998.
  • Thousands of dollars in improper daily-allowance and travel claims, an unauthorized raise, and vacation-pay credits that were never approved.
  • Everitt stopped providing expense receipts just months into his first term.

Everitt 'extremely appalled' by some parts of report

Everitt defended his spending on Monday, saying he was excluded from the audit process.

"The government will be accountable for the accusations they're making," he said. "I've acknowledged that I've made errors in judgment but nowhere near to the extent in what they're saying in these papers.

"I'm extremely appalled at some of the stuff that they've put in there that's just blowing people away. I've talked to some ex-city councillors, because this thing dates back years, and they're just devastated at some of the statements coming in this report."

Doddington also questioned the chief administrative officer's daily-allowance claims and $88,000 in credit-card charges over two years.

Council ignored misspending: auditor

The auditor chastises town councillors, saying they deliberately turned a blind eye to spending excesses on the part of their colleagues as well as flagrant breaches of policies and bylaws related to spending.

Doddington said he has also alerted police about $10,000 in bank deposits that went missing last year.

The auditor said the former mayor should repay $107,000 to Dawson City, the former chief administrative officer should repay $60,000 and the former treasurer should repay $33,000.

Doddington's report may be officially released on Thursday, when the territorial legislature reconvenes.