Audit on fast track in wake of $375K Edmonton economic agency phishing scam

Edmonton's city auditor will examine the Edmonton Economic Development Corporation's programs and books sooner rather than later, following news that the agency lost $375,000 in a fraudulent financial transaction.

Audit originally scheduled for 2020 now will happen this year

The city's audit committee agreed to fast-track examination of the Edmonton Economic Development Corporation's programs and books. (Natasha Riebe/CBC)

Edmonton Economic Development Corporation will be under scrutiny sooner rather than later, following news that the agency lost $375,000 in a fraudulent financial transaction.

On Thursday, the city's audit committee asked the auditor David Wiun to evaluate the city-funded organization this year instead of waiting until 2020 as previously planned.

The move comes one day after EEDC announced that it was the target of a phishing scam in December. That matter is now under investigation by outside consultants and the Edmonton police. 

Coun. Mike Nickel said the latest development has "rocked some confidence in this organization."

"I moved away from this 'trust but verify' to 'now we've got to know what's actually going on.' "

Mayor Don Iveson agreed that an audit will help clarify what's working and what's not. 

"I'm relieved to see this move ahead quickly," he said. "If there are legitimate issues, we need to be able to identify them, solve them and move on." 

Hopefully after the first time I receive [a call] from the media and say 'no comment,' they won't ask anymore- City auditor David Wiun

Iveson didn't want to paint a "wholesale question of confidence in the organization."

He pointed out that about 1,000 people work under the EEDC umbrella, from Edmonton Tourism to those that run the Edmonton Convention Centre and EXPO Centre.

Employees should be able to continue going to work with confidence, Iveson said.

"The uncertainty for this organization and the people who work within it, I think, is becoming as great a threat to its ability to deliver on its mandate as some of the other questions themselves."

The original report in front of the audit committee Thursday earmarked 2020 as the starting date for the audit. The date was at the request of the EEDC, under the leadership of its new CEO Derek Hudson.

"The EEDC has a number of initiatives underway that they feel, with the benefit of time, should enhance an audit undertaking," the rationale stated.

That includes refining and clarifying the 26-year-old agency's mandate and role.

'I will be getting phone calls'

Nickel asked for a specific timeline for the audit.

"After yesterday's announcement, I will be getting phone calls," Nickel said to Wiun during the meeting. "Is the audit going forward, how long is it going to take and what's it going to examine? Which I think are all fair questions." 

Nickel was referring to phone calls from the public or people concerned about the use of taxpayer money, to which Wiun responded that he expected to get phone calls, too, seemingly of a different nature. 
At Thursday's audit committee, Mayor Don Iveson said he was relieved the audit is being pushed forward. (Nathan Gross/CBC)

"And hopefully after the first time I receive [a call] from the media and say 'no comment,' they won't ask anymore," Wiun said.

Wiun said his office will assess the higher risk areas at the EEDC before suggesting a definitive deadline.

"This is potentially a fairly large undertaking and that probably means that it won't be done in two months, it'll probably be closer to six months but I'm even uncomfortable giving you that timeline."

Wiun said he's scheduled to meet with Hudson on Friday.
Coun. Mike Nickel has been calling for months for an audit of the EEDC. (Nathan Gross/CBC)

Hudson released a statement Thursday saying that the EEDC is "completely open to the auditor looking at our processes, practices and controls." 

He said the agency values transparency and welcomes the auditor's input into how the phishing attack happened and what can be done to prevent a similar instance in the future.

"We know it's vital that taxpayers have trust and confidence that their money is being used appropriately and effectively," Hudson said in the statement.

"We are more than willing and able to start working with the auditor today."

The decision to begin an audit this year still needs approval from the EEDC's board of directors. 



To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.

Become a CBC Member

Join the conversation  Create account

Already have an account?