Nova Scotia

Former IWK Health Centre CEO Tracy Kitch found guilty of fraud

Former IWK Health Centre CEO Tracy Kitch has been found guilty of fraud over $5,000 after charging tens of thousands of dollars in personal expenses to a corporate credit card.

Kitch charged personal expenses to a corporate credit card including flights to and from Ontario

Tracy Kitch, centre, the former chief executive of the IWK Health Centre, a children's hospital, heads from provincial court during a break in Halifax on Monday, Nov. 8, 2021. (Andrew Vaughan/The Canadian Press)

Former IWK Health Centre CEO Tracy Kitch has been found guilty of fraud over $5,000 after charging tens of thousands of dollars in personal expenses to a corporate credit card.

In delivering his decision in Halifax provincial court on Monday, Judge Paul Scovil said Kitch breached the high ethical standard to which someone in her position is held and her actions "cannot be seen as other than against the public good."

"The evidence before the court clearly showed that Ms. Kitch used corporate funds for personal expenses, placing the IWK funds in potential peril," Scovil said in his decision.

Another charge of breach of trust was stayed.

Kitch, who appeared via video conference, was charged after a former board chair at the Halifax-based children's hospital went to the police following an internal investigation in 2017 that revealed Kitch billed $47,000 in expenses deemed personal to a corporate credit card during her tenure.

Judge Paul Scovil delivered his decision in a Halifax provincial courtroom on Monday. (Robert Short/CBC)

Those expenses included flights to and from Ontario, where her family was still living, using prepaid tickets the hospital bought.

There were also taxi rides, Netflix and iTunes charges, data overage bills, a hotel stay for her mother and a rental car kept even after hospital business was complete, which incurred parking tickets.

"Using a rental car for personal use and not advising of, or paying the parking tickets related to the same, fall within the area of fraudulent activity," said Scovil.

Scovil said Kitch, as CEO, signed documents acknowledging that the corporate credit card was not to be used for personal charges, yet did so anyway.

"Additionally, each and every expense claim contained certification that they were proper charges. They obviously were not," he said.

The judge went on to note that Kitch "assured two separate board chairs that her expenses were in order, when they clearly were not."

Crown attorney Peter Dostal says he needs to review a pre-sentence report before making a recommendation for sentencing. (Craig Paisley/CBC)

Crown attorney Peter Dostal said he was pleased with the verdict.

"We've been saying all along that the notion of just simply paying it back later at one's own convenience is not a defence to this," he told reporters outside the courtroom.

"The offence of fraud happens when you unlawfully and without any right take money from a public institution — and in this case, a children's hospital — and then use it for personal purposes, including travel to see family."

Kitch stepped down from her post in August 2017, eventually paying back all the money considered to be personal charges.

In October 2018, police charged Kitch, as well as former hospital chief financial officer Stephen D'Arcy. D'Arcy, whose trial is scheduled for later this year, is charged with breach of trust, unauthorized use of a computer and mischief to data.

Sentencing set for April

Scovil ordered a pre-sentence report and Kitch is scheduled to return to court at the end of April for sentencing.

Dostal said his office would weigh the information in that report in making a sentencing recommendation, however he said a strong response is warranted.

"This was, in our view, a great breach of trust," said Dostal.

"One of the most prominent public officials in the province of Nova Scotia abused her position, in the word of the judge, in a flagrant way."

During the two-week trial before Christmas, Kitch's defence argued that the former executive did not misrepresent what she was doing or try to hide any of the charges, which she was repaying. They noted no witnesses testified to seeing Kitch create any fake receipts. The defence called no evidence during trial.

Kitch's lawyer, Jacqueline King, did not return a request for comment Monday.

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