On August 4 I wrote to the Minister of National Revenue asking her to audit the WE Charity, and naming ten specific corporate or foundation entities that are affiliated with WE Charity.
As a charity, WE has the ability to issue tax receipts to donors, receipts that reduce the tax payable by those donors. Thus, it is in the public interest that charities are using that privilege according to the rules, and using the funds raised for legitimate charitable purposes. The WE scandal has raised many questions - not just about the government's very close affiliation with the WE group of entities, but about those entities themselves and the opaque and complex way in which they operate.
It is in the public interest that the Canada Revenue Agency ensure that the WE group of entities is adhering to the policies required of an agency granted charitable status.
It is also concerning that allegations around the WE charity may be causing difficulties for other charities with their corporate fundraising. It is important to clear the air.
Here is the letter I wrote:
August 4, 2020
The Honourable Diane Lebouthillier, P.C., M.P.
Minister of National Revenue
555 MacKenzie Avenue
Ottawa ON K1A 0L5
The exposure received by WE Charity and its assemblage of connected entities has placed Canadian charities at risk of losing significant corporate sponsorships and donations, as a result of the opaque organizational structure and accounting mechanisms displayed in this one case. In the midst of the downturn in funding resulting from the COVID-19 pandemic, further decreases in donations to Canada’s charitable sector would cause increased social hardship and further challenges to a sector already facing enormous hurdles.
Surely, as Minister of National Revenue, you and your officials must be curious as to the fluidity of expenses allocated between various WE entities, such that it is not apparent that expenses of tax-exempt charitable events were not properly accounted and have been allocated, in instances, to taxable entities. In addition, the transparency of expenditures associated with charitable entities needs to be above reproach, particularly when it concerns any suspicion of individuals associated with the charitable entity being enriched with connected entities, with no apparent public disclosure. I would suggest that WE Charity’s previous corporate partners are speaking loudly in this regard by withdrawing their support for this organization.
I request that you take action to provide clarity with respect to the entities connected to WE Charity, and commission a complete audit of the consolidated financial statements of all connected entities, including WE Charity, ME to WE Corporation, WE Education for Children Limited, WE Villages, WE Schools, the ME to WE Foundation, the WE Charity Foundation, ME to WE Asset Holdings Inc., ME to WE Property Management Inc., ME to WE Style Inc., all of the internationally registered entities, or any other entity created by Marc Kielburger, Craig Kielburger, or both of them, or any entity connected closely to them. The transparency and propriety of the funds flow mechanisms between entities is fundamentally important to the perception of Canadian donors for the treatment of their donations and contributions, as it should be for the Government of Canada.
The proper reporting mechanism for the audit would be through the House of Commons Finance Committee, and we request that you instruct your officials to work with the coordinators of this committee in bring transparency to this matter.
I look forward to your action on this important matter.
ORIGINAL SIGNED BY
Greg McLean, M.P.