OTTAWA, Ont. — Former OBAC accountant Anthony Leckie was sentenced in Oshawa criminal court Oct. 18, to 12 months of house arrest and ordered to pay $49,319.00 in compensation to OBAC.
The compensation is to be paid to the Owner-Operator’s Business Association of Canada (OBAC) from which Leckie was found guilty of defrauding the total amount.
Leckie entered a guilty plea in July to a charge of fraud over $5,000.
OBAC officials meanwhile, have stated that they are not sure Leckie will be able to refund the money and have not yet ruled out filing a civil suit against him as well.
Prior to sentencing, OBAC filed a Victim Impact Statement with the court outlining how Leckie’s actions affected the organization. The following is an excerpt from OBAC’s statement. (The complete statement will be available on OBAC’s Web site at www.obac.ca, and in the December edition of Truck News.)
Victim Impact Statement Victim: Owner-Operator’s Business Association of Canada (OBAC) et al Accused: Anthony Leckie
Although the theft of funds from an organization is often considered a “victimless” crime, the victims in this case are many. The stolen money was start-up funding that had been advanced to the newly incorporated not-for-profit association, and the only money it had to work with at the time.
The money was earmarked to establish OBAC’s corporate identity, select the volunteer Board of Directors, develop a Web site, and plan and execute the public launch of the association. All of these activities took place – but were not paid for – hence OBAC was in debt even before it got off the ground, a fact not known to Directors and other volunteers until after the discovery of Leckie’s disappearance, just after the official launch of OBAC, at two major truck shows held on consecutive weekends in September 2002.
The Board of Directors had met for the first time six weeks prior to that, and were very optimistic about OBAC’s future; the initial meeting was an extremely positive experience and spirits were running high. Signals from the industry were also positive, and a great deal of interest was generated at Truck World 2002 in Toronto, and the following week at Truxpo in Abbotsford, BC.
All came to a halt in the days following the truck show in Abbotsford when it was discovered that not only was Leckie missing, but Directors did not have access to their own bank account, because Leckie had not acted upon Board resolutions to change signatories.
This fact alone caused extreme distress among Directors, as they were unable to gain financial control of the organization they were responsible for, or even to determine a bank balance. This led to public embarrassment, as rumours began to circulate around the trucking industry that “the accountant had run off with the money” and Directors were unable to defend or even explain their situation.
The organization and its supporters became the target of negative, sometimes “sensational” media coverage, which was to continue for some time, and an inordinate amount of time and energy was expended just doing “damage control.” As well, Leckie’s disappearance coincided with the deadline by which the organization (through its accountant) was to account for the advance of start-up funds it had received from Industry Canada, putting OBAC in default of its funding agreement.
There followed weeks of tension and stress while Directors worked with Industry Canada officials to determine the extent of the loss, and to satisfy themselves and others that there was no wrongdoing or mismanagement on the part of OBAC Directors. While it was clear that OBAC was a victim of fraud, it would be months before Leckie was found and charges laid.
As well as trying to deal with negative media coverage, suspicion, and innuendo, Directors, who had agreed to be members of a volunteer policy and advisory board, were now faced with responsibility for “running” the organization. Daily housekeeping duties fell to individual Directors who were ill prepared to undertake this work, especially with no resources. This led to a great deal of confusion and internal turmoil and friction, and the personal resources of Directors and others involved in starting up the association were continually being tapped to keep the project operational.
Tragically, without resources to hire the full-time services of an Executive Director, OBAC was unable to properly set up an office and develop operating and business strategies, implement a communications strategy and recruiting campaign, or begin to develop products and services for members. In effect, it could not operate. This made it impossible to generate revenue through memberships, which were intended to sustain the organization once the start-up funds had been properly disbursed.
Most importantly, this lack of stability caused an intractable skepticism among individual truck drivers and owner-operators across Canada who were to benefit from OBAC. Negative coverage by the trade press continued. With each depressing turn of events, there were resignations from the Board (the most high profile of which was a front-page item in the trade press). This particular aspect of the process proved to be very difficult for all who were involved.
The protracted nature of the case caused by the inability to resolve the longstanding accounting irregularities drained the spirits of Directors and mocked their enthusiasm. It generated hostility from the trucking community and cast a pall over the credibility of the association, its Directors and supporters. It is difficult to describe the disappointment and frustration, which overshadowed the entire project.
OBAC’s first members, who joined the organization in good faith during its launch, and then got nothing for their money, are also victims of this crime. And the forty to fifty thousand owner-operators who would have benefited from OBAC, lost out because the organization was not able to carry out its objectives and provide them with the business association they so desperately need.
Also victims are OBAC’s creditors, those businesses who provided goods and services in good faith, and have not been paid. Many of them are small businesses struggling to survive, and can ill-afford the loss of revenue that has resulted from this crime. OBAC has also suffered greatly from the embarrassment of debt to these businesses. The financial consequences of Leckie’s crime have been devastating to OBAC. Leckie left the organization with no files or documents, no budget information or financial books and records. The failure to recover these vital records and budget information, which would have aided the reconstruction of the accounting profile, left OBAC unable to prove to governments, potential members and investors, and other industry stakeholders, that its efforts merited their participation.
Ultimately, because OBAC could not properly account for the advance payments it received from the two governments, it was denied access to the balance of funds in both agreements.
A forensic audit has now been carried out, and audited financial statements prepared for the years ending December 31, 2002 and December 31, 2003. The audit revealed many Unsupported Disbursements, all of which were cheques made out to Leckie by himself. While some of these disbursements may have been legitimate, the auditors were unable to recover or obtain documents or records to substantiate them.
The audit also revealed that the total amount of OBAC’s debt was owing to companies and individuals who had provided goods and services (legitimate expenses under the contribution agreements) leading up to OBAC’s launch, and had not been paid at the time of Leckie’s disappearance.Because OBAC was missing the funds to hire an Executive Director and implement its strategic plans, and because of the negative publicity it received, the association was unable to attract and recruit members, depriving it of much needed operating funds.
In addition to loss of membership dues, OBAC lost the confidence of a number of industry suppliers who had agreed to make an investment in the organization. With no evidence of leadership, no strategic plan, and a pall of suspicion hanging over the organization, they withdrew their offers of sponsorship.
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