3 min

Capital Pride members vote to declare bankruptcy

Interim board says forensic audit needed

At the Dec 17 AGM, Capital Pride’s interim board announced that it had reached the same conclusion as the previous board — that with a heavy debt load and a damaged public image, the organization’s only clear recourse was to declare bankruptcy and begin anew. Credit: Thinkstock

Capital Pride members have voted to declare bankruptcy after all.

At Capital Pride’s annual general meeting (AGM), held Dec 17 at Ottawa City Hall, 41 members voted in favour of bankruptcy, five voted against and three members abstained. Peter Zanette, an interim board member, will serve as treasurer for the purpose of filing bankruptcy on Dec 31, 2014.

At last month’s meeting, Capital Pride members voted to delay the previous board’s plans to file for bankruptcy for 45 days while an interim board reassessed the situation. The organization was in crisis following the board’s Aug 29 statement alleging that post-festival “accounting irregularities” could result in a police investigation.

During the Dec 17 meeting, the interim board announced it had reached the same conclusion as the previous board: that with a heavy debt load and a damaged public image, the organization’s only clear recourse was to declare bankruptcy and begin anew.

“A fresh start is needed,” said Michael Wright, an interim board member, as he addressed the attendees. “The present organization seems battered and dysfunctional, and it is time to vision again and move forward with creating a new organization that can house the spirit of Pride.”

The interim board members said they’d had difficulty in getting to the bottom of the organization’s finances. Although a financial form was handed out to members and media, when pressed for more specifics and clarifications, Zanette said he couldn’t offer definitive answers.

“These are the only figures, which I couldn’t verify, [which] were provided by the last board,” Zanette told Xtra following the AGM. “I did not have the time to verify or the skill set to do it.”

When asked why the document distributed Dec 17 showed a debt of $106,000 versus the $89,000 shown on financial documents at the Nov 5 AGM, Zanette said the previous number was a mistake. “There were errors in the tabulation,” he said. “That’s why members were frustrated.”

While Zanette was able to correct the tabulation based on the numbers available, he said only a forensic audit would provide conclusive answers to Capital Pride’s financial situation. 

“A vital forensic audit occurs attached to declaring bankruptcy,” Wright said during the meeting. “That happens automatically, and we don’t see, going forward, a way to more efficiently arrive at that outcome.”

Zanette said the previous board had submitted police reports regarding money that had allegedly gone missing. Former festival suppliers Sébastien Provost and Guillaume Tasse told Xtra in the fall that they had filed fraud complaints with police when their cheques bounced post-festival and board members cancelled meetings. An Ottawa Police Service spokesperson said police don’t confirm or comment on investigations unless or until charges are laid.

In addition to Pride’s beleaguered financial situation, the organization’s reputation has suffered greatly, Wright said. “The brand and the perception in the community has been increasingly and cumulatively degraded. The board has a fiduciary duty to recommend what we think are the actions going forward that expose the organization and the movement to the least amount of risk, and we think bankruptcy does that.”

While the bankruptcy vote passed by a wide margin, two subsequent resolutions were rejected. Members voted against a resolution that the interim board be accepted as a nominations committee to create a new organization. Members also voted against holding meetings at Jer’s Vision until a new board decides on a new location.

“I don’t think it’s appropriate for the interim board of an organization that’s dying its last breath to be a selecting committee for its next up-and-coming Pride,” said Tova Larsen, who was Capital Pride’s parade coordinator, as she urged the membership to reject both resolutions.

Instead of accepting the interim board as a nominations committee, a meeting will be held Jan 15 to discuss plans for a new organization. Some of the attendees expressed concern that the Dec 17 AGM was promoted more to Capital Pride members as opposed to the wider community. With no interim board in place, all community members will have an opportunity to take part in deciding what happens next.

“This board worked really, really hard to try and move things forward and create a structure to build something brand new,” said Jeremy Dias, who was a member of the interim board. “This opens the door to leave the whole process in a period of uncertainty.” At this point, it’s unclear who will organize and run the Jan 15 meeting, he said.

“I hope this new group can do something and bring people forward,” Zanette said. “It’s a community that should keep any board on their toes, but they also have to step up.”