Misuse of money at Saskatoon shelter an example of why non-profits need more oversight: lawyer

Canadian charities need more regulatory oversight, according to a lawyer who focuses on non-profits.

Mark Blumberg is a partner of a law firm in Toronto. He works almost exclusively advising registered charities and runs a website listing charity’s financials — in an effort to increase transparency.

“Unfortunately, we don't have a lot of regulatory oversight in Canada,” Blumberg said.

Canada has about 85,000 registered charities with revenue worth $312 billion, according to Canada Revenue Agency (CRA) data from 2020-2021.

“The sector is far bigger than agriculture, or banking," Blumberg said.

"It’s quite important and should get more attention from the public."

Of the 85,000 charities, 142 were audited last year, according to CRA data obtained by Blumberg. It’s a drop from 751 audits 10 years ago.

“The lack of CRA oversight is a huge concern … if CRA is going to only going to audit, on average, a charity once every 400 year — that's definitely not adequate,” Blumberg told CTV News.

On Monday, court documents were unsealed, revealing the director of one Lighthouse Supported Living, Don Windels, has used shelter money for personal reasons.

The court-ordered financial investigation found Windels received, and repaid, loans from the Lighthouse totalling $287,000.

According to the investigation, the board approved the loans, but the board included Windels’ family members.

An additional $30,000 loan to another board member is still outstanding, the investigation found.

Greg Thomson is the research director at Charity Intelligence Canada — an organization that analyzes charities' financials.

Thomson said the Lighthouse could lose donors as a result of the financial investigation.

“When donors lose trust in the charities, that’s problematic. So this is an example where a lot of trust has been eroded,” Thomson said.

“They’re going to have to work very hard to regain that trust.”

The Lighthouse has an annual budget of $6 million. The province contributes $1 million to the Lighthouse this year.

The Ministry of Social Services said despite the financial findings, it will “continue to work directly with the organization.”

The province said it’s been “monitoring this situation very closely” since board members raised concerns about spending last year.

As a result of the financial investigation, a judge ordered Windels step down from his position.

In January, Windels was placed on leave with two board members taking over his duties.

However, he remains the organization's executive director pending the outcome of a court appeal.