A senior Conservative senator has his facts wrong about environmental charities, the head of one Canada's largest conservation groups says.

Gerald Butts, the president of World Wildlife Fund Canada, says Senator Doug Finley is wrong to suggest U.S. foundations give money to environmental groups so they can have a behind-the-scenes influence on Canadian policies.

This just doesn't happen, Butts said in a phone interview.

"Absolutely not. Let me put it this way: It shows a really loose understanding of the facts to suggest that."

Finley said in a speech Tuesday that U.S. foundations are undermining Canada's economy through their financial support for Canadian activism. Groups in this country that protest against the oilsands are part of a plot to "undermine" the Canadian industry and should lose their status, he said.

"It should never be considered a charitable act to attack Canada's oil sands."

But the WWF's Butts said only about two per cent of his organization's $23-million budget in 2010 came from U.S. foundations. That money was spent on campaigns for sustainable fishing practices in BC.

"I kind of take offence to the suggestion that people give us money in order to tell us what to do," he said. "It's quite the other way around. We decide what our conservation priorities are and then we go out raise money from people who want to support those priorities."

Looking into alleged foreign influence

The Senate is holding an inquiry into the influence of foreign foundations on Canadian charities. Finley, who is the Conservative Party's former national campaign director, told the inquiry some charities act as sort of Trojan horse for American interests on everything from fish farming to expansion of Alberta's oil sands.

Most environmental groups do rely on some money from big U.S. and international foundations.

Conservative Senators have suggested the inquiry could result in a recommendation to change tax law to make charities more open about where they get their money and how they spend it.  It could  also take away the charitable status from environmental, groups depending on their activities.

Environmental groups worry this would make it harder to raise money and call it an attempt by the government to muzzle protests against big energy projects.                  

Butts simply calls it "disheartening." In the meantime, he points out all this focus on environmental charities is actually generating more public support. 

"If anything we've seen a bit of an uptick in donations."