The undergraduate student union at Toronto Metropolitan University has launched a lawsuit against five former union executives, alleging fraud and financial mismanagement that it claims has resulted in major financial losses and a huge hit to its already-damaged reputation.
The Toronto Metropolitan Students’ Union filed a statement of claim this week seeking $900,000 in damages after alleged wrongdoing by members of the executive team from the 2021-22 academic year.
It alleges former student union president Siddhanth Satish and former executives Vaishali Vinayak and Tarmanjit Mann defrauded the union for personal gain, while former executives Akibul Hoque and Maleha Yasmin were allegedly wilfully negligent in overseeing the union’s finances.
“As a result of the defendants’ deliberate and wilful financial mismanagement the TMSU has suffered extensive losses and damages,” the statement of claim alleges.
“The most direct financial loss has been to deprive the organization of the misappropriated funds. The defendants’ actions have also forced TMSU to devote an enormous amount of staff time to determine what occurred.”
The former executives named in the lawsuit did not immediately respond to requests for comment.
The Toronto Metropolitan Students’ Union is funded almost exclusively through fees paid by its student membership of approximately 40,000 full-time students.
The lawsuit says the union collected approximately $2.95 million in revenue from student fees in 2021-22, while other revenue sources totaled less than $750,000.
The statement of claim – first reported by the university’s independent student newspaper The Eyeopener – alleges the former executives authorized nearly $75,000 in withdrawals from the union’s bank account to pay for Toronto Raptors tickets intended for student giveaways that were instead used or resold by some executives.
It further alleges payments – ranging from $1,700 to more than $138,000 – were authorized by the executives for business-class flights for other individuals without rationale, a virtual reality headset and payments to third-party vendors without board approval.
Many payments are missing receipts, invoices and supporting documentation or justification, while at least one had no legitimate business purpose, the suit alleges.
The allegations in the statement of claim have not been proven in court.
The union, which did not respond to request for comment on its lawsuit, is seeking $900,000 in damages for alleged breach of fiduciary duty, breach of contract, civil fraud and conspiracy.
The statement of claim said the alleged mismanagement has significantly affected the union’s reputation, which was already marred by an alleged $250,000 financial mismanagement scandal in 2019.
The university had terminated its operating agreement with the student union in 2020 in response to those earlier allegations, saying it “lost confidence” in the organization’s ability to represent students. That decision was later reversed following a legal challenge.
The statement of claim said the past several years had been difficult for the student union.
“The defendants, most of whom ran for election just one year after the University tried to dissolve and replace (TMSU), were fully aware of the financial impropriety that had occurred in 2018 and 2019 and the devastating impact it had on the organization,” it said.
“Despite this fact … they engaged in repeated financial improprieties, including willful and bad-faith efforts to defraud the (TMSU),” it alleged.
In a written statement, Toronto Metropolitan University’s vice-provost for students, Jen McMillen, said the university is aware of the lawsuit and while it “finds this development troubling,” it emphasized the student union is a separate legal entity with its own governance structure and bylaws.
“Despite the university’s interest in ensuring the student union employs proper governance and oversight practices as they relate to the current operating agreement, the university has no authority to conduct internal reviews of finances or to dictate internal policies and decision-making,” said McMillen.
“This was reinforced in the 2020 court decision … where the university was ordered to transfer fees to the student union despite significant concerns over prior allegations of mismanagement,” she wrote, adding the university will continue to support efforts to increase transparency and accountability to students.
This article was originally sourced from www.CP24.com