Fired OLG head says she's suing the province
Nearly two weeks after being fired as the head of the Ontario Lottery and Gaming Corporation, Kelly McDougald said she is suing the provincial government for what she says was "severe and unjustified" action against her.
The former CEO says she is suing the province to restore her reputation after government officials said they had uncovered executives at the organizations filed some questionable expenses.
A source at Queen's Park tells CTV Toronto McDougald is suing the province for about $8 million.
On Aug. 31, the Liberals publicly released two years worth of expenses that were filed by OLG board members, including:
- gym memberships worth $250
- Weight Watchers memberships
- club link golf fees
- a $1,500 bar tab at a $3,700 dinner for 38 people
- a $500 nanny fee so that a vice-president member could attend meetings, an amount since repaid
The same day, the Liberals also announced that OLG's entire board of directors had resigned.
In a statement released Friday, McDougald -- who has been with the OLG since 2007 -- called some of the filings "inappropriate," but she said most of the expenses can be explained.
"The expense information released by the Ontario government was done without effort by (the) government to either seek or provide context," the statement said.
"While some of these expenses were indeed inappropriate, others were business expenses consistent with the operation of a $6.5B revenue generating corporation or were part of the employee benefit contract, others were incurred prior to my appointment."
She said she has retained a Toronto law firm to help her establish the facts.
The gaming corporation has been scrutinized for the last two years after questionable insider wins, malfunctioning slot machines, spoiled scratch-and-win tickets and a controversial decision to purchase foreign cars as lottery prizes at a time when the Ontario government agreed to a financial bailout for its struggling auto industry.
It was also revealed that OLG had been issuing untendered contracts.
Such contracts were a major part of the controversy surround eHealth Ontario, the electronic health records agency that also saw its CEO and board chair depart after revelations of excessive spending.
Ontario's finance minister Dwight Duncan, who took on responsibility for OLG, said the government is launching a province-wide review of accountability procedures for the government's agencies, boards and commissions.
He suggested that a new "mechanism for accountability" would be able to offer early detection of brewing problems.
In a statement Friday, Duncan said it would be inappropriate to comment directly on the lawsuit. However, "The government denies the claims and will vigorously fight against them in court," he said.
"OLG is an arm's length agency of the government. It's essential that it operate in a way that follows the rules and protects taxpayers' interests."
Some have noted that Sarah Kramer, the former CEO of eHealth, was allowed to resign and received severance pay of $300,000.
"Different circumstances merit different responses, and we responded in a way we believe serves the best interests of Ontario taxpayers," Duncan told reporters Friday.
NDP Leader Andrea Horwath said the legal battle resulted from the "McGuinty government's knee-jerk reaction to the scandal that unfolded with the OLG. But what we still haven't seen in this province is any cabinet accountability whatsoever."
With a report from CTV Toronto's James Macdonald