A recent forensic audit initiated by Indigenous Services Canada has identified $34 million in transactions at the Federation of Sovereign Indigenous Nations (FSIN) between 2020 and 2024 as questionable, ineligible, or unsupported.
FSIN officials were presented with a report by KPMG, a consulting firm, on Thursday. The presentation slides were shared with CBC News, revealing that out of $47.1 million in FSIN transactions audited, $34.3 million were flagged. Within this total, $3.7 million was classified as “ineligible,” $30.4 million as “questionable,” and $156,000 as “unsupported.”
According to KPMG, “questionable” expenses lacked complete supporting documentation, particularly in consultant expenditures where the purpose for procurement was unclear.
The audit was prompted by allegations of financial mismanagement, with Indigenous Services Canada informing FSIN in March 2024 about the examination. The audit particularly focused on COVID-19 funding, with the largest amount flagged being $23.5 million in questionable COVID-19-related expenses.
KPMG highlighted that out of the $30 million in COVID-19 funding received by FSIN between April 1, 2020, and March 31, 2023, only $3 million of transactions were deemed “eligible” after auditing $26.5 million of the funds. Additionally, $8 million in administration fees and various internal charges, including excessive photocopying costs, were questioned.
The audit also revealed payments to a former employee totaling $246,524 as “ineligible.” The individual received funds through a contract with FSIN to a personal company for services aligning with their employee responsibilities and received an inappropriate severance package.
Muskeg Lake Cree Nation’s Kelly Wolfe expressed deep concern over the findings, emphasizing the need for a modern, transparent governance system based on collective responsibility and ancestral wisdom. James Smith Cree Nation had previously raised issues regarding the handling of federal pandemic relief funds by FSIN.
Indigenous Services Canada stated that the audit report will soon be finalized, with recommendations detailed in a summary letter sent to FSIN. A summary of the audit findings will be made public on the department’s website before September 30, following the policy of providing only a summary without further details at this time.
