No public details coming on Saskatoon fraud protections, staff consequences

The City of Saskatoon says better financial controls are coming and staff are facing consequences in the wake of a fraud scheme that temporarily bilked $1.04 million from public coffers, but the public won’t find out exactly what actions were taken.

City councillors were updated Monday on the status of the fraud investigation, and were told many details would be kept out of the public eye due to security and privacy concerns.

The report followed an incident in August, where an email fraudster impersonated the CFO of Allan Construction, asking the city’s financial department to change direct deposit information for the company. Staff complied, and the next payment due to Allan went to the fraudster’s account.

All of the $1.04 million has been secured by the city, after a court order in Ontario to return the money from several accounts. The city was also awarded $25,000 in legal fees — which will partially cover the $100,000 legal bill.

City manager Jeff Jorgenson told councillors new financial controls are being put in place, but he wouldn’t disclose what those checks and balances would be.

Mayor Charlie Clark told the Brent Loucks Morning Show on Tuesday there was a good reason to keep those controls a secret.

“If you start going out there and talking about exactly where there was a vulnerability, or exactly what areas we’ve tightened up … you’re just sharing more information that people listening who can say ‘well, I’m going to see if I can fraud the City this way or that way,'” he said.

The City also won’t say what reprimands or corrective measures staff are facing in the wake of the fraud.

Clark said they never disclose human resource matters to the public.

“There were consequences, but we don’t get into the details of who and what — HR matters are confidential,” he said.

The mayor did commend City staff in his interview, saying they took the fraud personally and worked diligently to recover the stolen funds.

He said the City has “learned its lesson” and hopes the incident will help other organizations protect themselves against future fraud attempts.