Finance minister disputes media coverage of spending scandal debt
The house management commission has recommended the $2.4-million debt resulting from fraud by businessman John Hand should be moved into the “doubtful accounts” category. That’s not the same as a writeoff, Finance Minister Tom Marshall says. — File photo by Keith Gosse/The Telegram
Finance Minister Tom Marshall is disputing media coverage that stated the provincial government is writing off $2.4 million it is owed in relation to the constituency spending scandal.
In a statement released Thursday afternoon, the minister said before any such amount can be written off, it requires Treasury Board approval, as stated in Section 18 of the Financial Administration Act.
“No such request for approval has been made nor have there been any writeoffs related to this issue.”
The money is owed to government by businessman John Hand, who was convicted earlier this year of defrauding government.
From 1998 to 2006, Hand bribed former House of Assembly financial officer Bill Murray in exchange for contracts to sell gold rings, lapel pins, and other items to government. Many items were never delivered to government.
In a meeting held Wednesday morning, the House of Assembly Management Commission moved the $2.4-million debt into the “doubtful accounts” category.
Marshall added the provincial government has a judgement registered with the courts against Hand and is continuing to pursue all legal avenues it can avail of in order to recoup the money owed to government.
He said moving the debt into doubtful accounts is a proper accounting practice required for any amounts owing to the province which have a risk of not being collected.
“Information put before the Management Commission of the House of Assembly on Dec. 14 was for the purposes of recognizing the allowance for doubtful accounts as per generally accepted accounting principles,” said Marshall.
Hand was sentenced to three years in jail on Jan. 7, 2011 and ordered to pay the government back $450,000.
At the time of sentencing, defence lawyer Bob Simmonds said Hand had approximately $60,000 in assets.
Meanwhile, the House of Assembly Management Commission has finally closed the file on money double billed by former MHAs.
The double billings by MHAs came to light in the wake of the constituency spending scandal.
The scandal sent six men to jail for defrauding the government — including four MHAs, Hand, and Murray — but it also involved money misspent by dozens of other elected members.
The House of Assembly has been slowly working to recover that money. As of 2010, the money owed from double billings was down to $76,708. On Wednesday, the commission reported that it has recovered all that money, and the balance is now down to zero.