Winnipeg police headquarters (HQ) construction scandal has more than $20 million being sought in damages with no guarantee of recovering this money.
For background, the City’s legal action against several defendants alleges the city was fleeced with fake or inflated invoices and other irregularities. The City is seeking damages for allegations of fraud, conversion, fraudulent and-or negligent misrepresentation, deceit, conspiracy, unjust enrichment, negligence, and breach of contract.
The City’s Executive Policy Committee (EPC) seek to give $1.198 million to the City’s Legal Services Department to cover the cost of external lawyers and forensic accountants. The funds, if approved by the council, will enable Legal Services to continue its litigation.
Doug Brown, director of Legal Services stated, “By not funding (the case) at this point we’ve essentially cut the blood out of the action.” Brown noted that if the city doesn’t have the resources to continue this case, there would have many consequences. Brown also pointed out that defendants, in this case, can come back to the city either seeking the claim or look for a dismissal. The defendants would have the right to ask for their costs to date.
Public service reported that the cost of building the police HQ increased significantly during construction – this raised several questions about taxpayers money. The investigation identified over $20 million of contractor and subcontractor claims related to the project that were not documented or accounted for. At a cost of nearly $214 million — around $79 million over budget — police moved into the HQ in 2016.
Brown also noted that to communicate to the public that we are not prepared to protect the interest of the City by funding the action sends a very strong message and a reputational risk to the City.
In September 2020, Legal Services expanded its operating budget by $2,250,000 to pay for external legal counsel and forensic accounting in the HQ fraud matter.
When questioned why the City spent another $1.198 on litigation, Mayor Brian Bowman said a provincial public inquiry would’ve been an effective way of holding the alleged fraudsters to account.
Bowman stated that “we are taking action to defend the interest of taxpayers and the allegations of dollars we are alleging as a municipal government — fraud occurred — totals in the tens of millions.” This article was originally sourced by Canada.com