R. v. Mardonet, 2016 ONCJ 810

ONTARIO COURT OF JUSTICE CITATION: R. v.

Mardonet, 2016 ONCJ 810 DATE: December 19, 2016 COURT FILE No.: Toronto 4817 998 14-75002846-00 BETWEEN: HER MAJESTY THE QUEEN — AND — CHARLOTTE MARDONET Before Justice Richard Blouin Heard on January 21, 22, 27, 28, 2016; March 29, 30, 2016; April 21, 22, 2016; September 19, 20, 21, 22, 2016 Submissions Heard November 2, 2016 Reasons for Judgment Delivered December 19, 2016 John Scutt .................................................................................................... counsel for the Crown Paul Stern ....................................................................................... counsel for Charlotte Mardonet BLOUIN, J.: Overview [ 1 ] The prosecution theory is a simple one.

As a well-liked and long serving office administrator of a small non-profit professional association, (the Ontario Psychological Association – “OPA”), the defendant embezzled a significant amount of money between 2003 and 2013. Given that Ms.

Mardonet was the person who managed OPA finances and had signing authority, she had the ability and trust to divert money from the Association to her personal benefit through a number of avenues: • OPA cheques payable to herself deposited to her personal accounts • OPA cheques to cash deposited to her personal accounts • electronic transfers from OPA accounts to her personal accounts • diverting OPA funds to pay her, and her husband’s, credit card balance • using an OPA debit card to make cash withdrawals from an ATM • using an OPA debit card to make personal purchases. [ 2 ] The Crown submits that all of the fraudulent conduct above was done without the knowledge and consent of the Executive

Directors (Dr. Ruth Berman and Dr. John Service) for whom she worked. [ 3 ] The defence contends that the OPA was a small office which had characteristics of a family-run business. Ms. Mardonet expended personal funds on behalf of the OPA and vice versa. There was an intermingling of personal expenses and business expenses that were accounted for at a later time. In addition, cash was continually needed to fund stamp purchases and pay casual labour to assemble the extensive mailings to the membership and others. Ms.

Mardonet submitted that the Executive Director of the day, the Board of Directors (the Board), and the Auditors (BDO) were aware of her bookkeeping and accounting practices. All business and personal expenses had been verified by invoices or other tangible methods of proof, and all were approved by the Executive Director of the day, the financial officer, and annually by the auditors. [ 4 ] For the reasons I will outline below, I find the Crown has not proven this case to the requisite criminal standard. It initially appeared obvious that the defendant was diverting OPA funds to her personal benefit.

However, a reasonable doubt was raised, in my view, when the quality of the investigation was examined. I am not at all satisfied that the forensic accountant engaged by the OPA possessed the full complement of necessary documents to allow an accurate and fulsome determination of financial events years earlier. [ 5 ] And in addition, while I had significant difficulties believing the defendant’s evidence, I could not fully reject her contention that all expenditures made and monies removed were legitimate, backed up by available physical evidence, and approved by her superiors and the auditors.

It would be shocking, in my estimation, that one could remove the amounts of money from OPA accounts that are obvious in this case without any inquiry from superiors. And, it does not seem possible that Ms. Mardonet could do that without anyone asking for supporting documentation. It is also difficult to believe that Dr. Berman almost never looked at bank statements. Let me be clear though, if this were a civil case, on that different standard, my decision would be different. Although I did not believe the defendant, her evidence, and the evidence in totality, created a reasonable doubt.

The Investigation [ 6 ] In August of 2013 Janet Kasperski took over as Chief Executive Officer of the OPA from Dr. John Service. Shortly thereafter, Ms. Kasperski received an affidavit from an employee (Anna DiDonato) that had been filed in a wrongful dismissal lawsuit containing allegations of financial misconduct by the defendant. She also, around the same time, received bank statements, indications of Automated Teller Machine (ATM) withdrawals, and OPA payments to personal credit cards. She felt very uncomfortable and requested the Board of Directors to authorize BDO to conduct a “mini audit”. Ms.

Mardonet was notified that her last day of employment would be November 20, 2013 and, on that day, she relinquished her keys and a TD debit card in the name of the OPA. [ 7 ] In the months that followed, Ms. Kasperski hired an ex-employee (Ryan Morley) from her days as the Executive Director of another professional organization to assist in the investigation into OPA finances. The first part of the investigation involved locating past bank statements, which, according to Ms. Kasperski and Mr. Morley, could not be found at the OPA offices, and needed to be requisitioned from the TD Bank.

In addition, she hired a woman from BDO bookkeeping to assist with access to the computerized accounting records. When 10 years of statements were received Ms. Kasperski found frequent ATM cash withdrawals, debit card purchases from vendors that appeared to have no OPA connection, personal credit card bills satisfied by OPA funds, and numerous cheques to cash and to Ms. Mardonet. [ 8 ] Interestingly, during this “investigative stage”, in January 2014, Ms. Mardonet attended the OPA office, took Mr. Morley downstairs to the storage area, and identified a number of boxes with financial documents.

Cheque reconciliation records were found only from 2006. Ultimately, in May 2014, Ms. Kasperski recommended to the Board that the Association notify their insurers about the potential fraud. At this point, Ms. Kasperski not only was aware the insurers needed a police report, but felt she needed the involvement of the police. A forensic accountant, Robert Ferguson, was retained in October 2015 (she meant 2014). Mr. Morley provided the documents to Mr. Ferguson to allow his investigation and eventually his report (later made Exhibit 25).

The Forensic Accountant [ 9 ] Robert Ferguson’s forensic accounting report was filed as an exhibit (25) on consent after irrelevant or contentious sections, including his opinion, were omitted. Mr. Scutt conceded that it was not his intention to qualify Mr. Ferguson as an expert in accounting, although he has held a specialist designation in “investigative and forensic accounting” since 2000. Mr. Ferguson testified that he was retained in October of 2014. [ 10 ]

Schedule 2.1 listed chronologically, from December 2006 until February 2012, OPA cheques payable to Ms. Mardonet that were deposited in her personal bank account (TD-557112). Ms. Mardonet’s payroll cheques were not included in the above analysis. The total amount was $153,801.65. Mr. Ferguson made inquiries of the OPA regarding documents that supported the purpose of the above payments, and found there were none. All of the above cheques were cleared by the bank and Mr. Ferguson was in possession of copies of those cheques. [ 11 ]

Schedule 2.2 lists chronologically from May 2006 to May 2012 OPA cheques payable to Ms. Mardonet where no copy of the actual cheques was ever located (either from the OPA or TD Canada Trust). As a result, Mr. Ferguson was unable to determine where the cheque was deposited. These cheques, however, cleared the OPA bank account. The total amount of these cheques from the OPA to Ms. Mardonet was $205,045.10. [ 12 ]

Schedule 2.3 lists OPA cheques signed by the defendant, payable to cash, between June 2007 and October 2011, where Mr. Ferguson was able to identify the cheque as having been deposited to one (of two) of Ms. Mardonet’s TD bank accounts Those cheques totalled $127,003.48. Again, no supporting documentation to indicate the purpose of the cheques to cash was found by Mr. Ferguson or his associates. [ 13 ]

Schedule 2.5 lists cash withdrawals from 2003 to 2013, including from the three OPA accounts. I think it useful to reproduce this

schedule from page 2458 of Exhibit 25 because it sets out the cash withdrawn from each OPA account each year. The total amount

for the 11 years was $497,860.39. OPA v Mardonet et al

Summary of ATM Cash Withdrawals For the period from January 1, 2003 to December 31, 2013 Accounts Years 5000081 5000332 0723361 Total [1] [2] [3] 2003 $ 37,431.75 $ 16,918.00 $ - $ 54,349.75 2004 35,897.45 11,139.00 - 47,036.45 2005 47,503.20 11,178.40 - 58,681.60 2006 40,942.50 5,111.00 - 46,053.50 2007 49,543.75 6,612.75 - 56,156.50 2008 48,885.95 4,209.00 - 53,094.95 2009 43,526.25 9,611.30 - 53,137.55 2010 29,820.50 13,274.10 - 43,094.60 2011 33,025.50 8,762.00 - 41,787.50 2012 24,842.24 8,305.00 500.00 33,647.24 2013 8,514.00 2,306.75 - 10,820.75 Total Per Account $ 399,933.09 $ 97,427.30 $ 500.00 $ 497,860.39 Notes: [1] Information obtained from bank statements of TD Account 5000081. [2] Information obtained from bank statements of TD Account 5000332. [3] Information obtained from bank statements of TD Account 0723361.

Interestingly, the withdrawals are reasonably consistent throughout the whole year, and are not significantly over weighted in a particular month or months. [ 14 ] Exhibit 22 is a reproduction of

Schedule 2.6.1 with some deletions for non-relevance. It chronicles debit purchases using the OPA debit card from retailers (stores, restaurants, gas stations). Again, no supporting documentation was found for a majority of these debit purchases. Purchase totals were done yearly. Examples included: 2006 $ 25,566.12 2010 $ 19,846.47 2007 $ 21,916.63 2011 $ 9,911.02 2008 $ 20,321.61 2012 $ 12,188.96 2013 $ 11,090.30 [ 15 ]

Schedule 2.7 lists electronic transfers from OPA bank accounts to Ms. Mardonet’s bank account in 2012 and 2013. The total amount for that two-year period is $93,353.21. Once again, no supporting documentation as to the purpose of those transactions was located. [ 16 ] In cross-examination, Mr. Ferguson conceded that neither he, nor any of his associates, attended the OPA office to examine

records or documents. He relied on information provided to him by Ryan Morley, and OPA counsel. He did not speak to former employees or to the auditors. He also conceded this was not an investigation where his team had everything that existed. Any questions about transactions would be answered by Ryan Morley because he would know as the OPA employee that was “involved in the financial and accounting”. [ 17 ] In the accounts categorized in Exhibit 25, he included only “potentially improper payments”. He excluded known legitimate payments such as payroll.

However, he did not know about the method of benefit payments at the OPA. In fact, he was aware that Ms. Mardonet reported to the Canada Revenue Agency income from employment higher than her payroll. Mr. Ferguson was also not aware if any RRSP payments to Ms. Mardonet were included in the amounts he attributed to potential improper payments. Nor bonus payments. Nor overtime. In reality, Mr. Ferguson only reviewed receipts or invoices that would support legitimate payments from Ryan Morley. The Defendant [ 18 ] Ms. Mardonet worked for the OPA from 1988 until 2013.

She became the administrative assistant in 1991 and, at that time, was given signing authority. Whatever the OPA policy was (it was preferable to have the executive director sign), the practice allowed the defendant to sign cheques on her own. The annual budget of the OPA was in the $500,000 to $600,000 range. The Board of Directors approved the budget after consultation with the Executive Director and the financial officer. Salaries ($300,000), an annual convention ($80,000 - $90,000) and rent ($50,000) made up the bulk of the expenses.

However, mailing expenses were significant, especially in the early years before electronic communication. Membership and conference mailings required postage, and casual labour (often paid in cash). In addition, Board and Committee meetings required cash to pay for food and travel expenses. [ 19 ] Before 2005, when Ms. Mardonet had an assistant, the assistant would receive invoices, enter the expenditure in the accounting system, and create a cheque to be signed. When Dr. Berman was in the office, she would sign the cheques. When she was not, or was otherwise unavailable, the defendant would sign the cheques.

Any questions or concerns voiced by Dr. Berman were answered by Ms. Mardonet. Ms. Mardonet maintained that she kept ten years of invoices, receipts, accounts receivable, accounts payable, ledgers, cheques, and spreadsheets. Some of this material (the most recent two years) was kept in a credenza beside her desk, and the remainder was kept in boxes in the basement of the OPA office building. [ 20 ] Credit card statements, including her personal statements, were kept with cheque stubs attached. The underlying receipts were kept in an envelope stapled to the statements.

The auditor reviewed this approach and voiced no concerns about it. They sometimes questioned purported expenses but were satisfied with the defendant’s answers. [ 21 ] Unfortunately, according to the defendant, much of the documentation, including invoices that supported expenditures she made, was not part of the preserved record in this case. Ms. Mardonet attended the OPA offices to direct her successor (Ryan Morley), a few months after her

summary dismissal in November 2013, to the records kept near the desk, and downstairs in the storage area. In addition, she returned her “C drive” which contained a record of emails and other documents sent to the auditor (BDO). Ms. Mardonet’s position was that she had documented, and reviewed with the Executive Directors and auditors, any expenditure she made of OPA funds. That supporting documentation, which Ms. Mardonet contended supported proof of valid expenditures, was never found. Or, if it was found, much of it was not made available to her. [ 22 ] Ms.

Mardonet recounted a practice dating back to the late nineties involving her using a personal credit card to pay OPA expenses. Dr. Berman possessed an Amex card in the name of the OPA. Some merchants would not accept Ms. Mardonet making a purchase with a credit card in another’s name, or wouldn’t accept Amex at all. As a result, she was permitted to obtain a debit card in the name of the OPA. She also used a personal credit card (in her husband’s name) to make OPA purchases.

In this way, personal and business expenditures became entangled. [ 23 ] At the end of the year, an accounting was done to compensate the defendant for OPA expenses on her credit card, and to compensate the OPA for any personal expenses when the OPA account paid the entire credit card bill (as sometimes Ms. Mardonet did). According to the defendant, Dr. Berman, although initially unhappy, relented as long as the re-imbursement occurred. This procedure was also discussed with the auditors, and with the financial officer (sometimes referred to as the treasurer).

One of the methods of re- imbursement when she owed money to the OPA was to transfer cash to another employee (Ms. DiDonato) who would make a bank deposit, or retain it in petty cash. It would be accounted for in a miscellaneous or sundry account (which would have an anticipated zero balance at year’s end). The auditors were apparently happy with this approach. When the OPA owed her money, the defendant paid herself with cash or OPA payment to her personal credit card. The auditors, and Dr.

Berman, were also aware of this approach. [ 24 ] The defendant was questioned about a number of specific OPA expense payments where cash, cheques, credit cards or debit card of the OPA were used to make payments.

Those ostensibly legitimate expenses included: • postage for numerous mailings throughout the year (approximately $50,000) • casual labourer to assist with mailings, and other OPA needs • food and drink expenses associated with board meetings (6 per year) and numerous committee meetings (Exhibit 34 shows 23 committees and/or task forces in 2008) • gifts for staff and others • overtime (Exhibit 35 is an example of overtime for the defendant in February 2011) • office supplies • benefits

• automobile expenses • cell phone and internet bills. [ 25 ] Ms. Mardonet maintained that she always kept invoices for these expenses and, at the relevant times, was able to justify the expenses to her supervisors and the auditors. In fact, when Dr. Service took over as executive director from Dr. Berman, and after the complaints made by Ms. DiDonato regarding payments to the defendant’s daughter, he would rigorously examine bank statements and supporting documentation. In fact, the defendant testified about the special audit in 2012 that was conducted to investigate the complaints made by Ms. DiDonato.

BDO examined the cash payments made to casual labour including the defendant’s family. They examined the issue of mixing personal and business expenses and the appropriate re-imbursement. They examined the back-up for expenses the defendant made on behalf of the OPA which resulted in her re-paying herself. They were aware and commented upon the numerous cheques that were signed solely by the defendant. In the defendant’s view, the auditors expressed no dissatisfaction with the records kept by her. [ 26 ] In cross-examination, Ms.

Mardonet was challenged regarding her version of accounting procedure by the evidence of other witnesses employed throughout relevant periods in the OPA’s history. The testimony of Dr. Ruth Berman, Dr. John Service, and Anna DiDonato differs from the defendant generally on almost all issues dealing with accounting procedure: • Dr. Berman did not agree that the OPA usually paid Ms. Mardonet’s entire personal credit card bill, and would be paid back later. At most it was a few times a year. • Dr. Berman did not agree that she was not able to sign cheques regularly which then required the defendant to sign alone.

Dr. Berman should sign or initial every cheque. • Dr. Berman indicated overtime payments stopped in 2000. • Dr. Berman testified that the OPA did not reimburse employees for car expenses such as gas costs. • Dr. Berman testified that the OPA did not pay cell phone bills. • Dr. Berman testified that there were few OPA expenses that required the defendant to use her personal funds. • Dr. Berman testified that she had no idea that the defendant was making cash withdrawals from the ATM on a regular basis. In fact, she did not know that Ms. Mardonet had an OPA debit card. • Dr.

Berman testified that the defendant’s husband did not do any work for the OPA. • Dr. Berman testified that it was not her job to review monthly bank statements and did not do so after 2000. • Dr. Berman testified that she was not aware that Ms. Mardonet used her husband’s credit card to make purchases for the OPA. • Dr. Service testified he was not aware the defendant was writing OPA cheques to cash, that were being deposited in her account. • Dr. Service testified that the defendant did not regularly use her personal credit card to pay OPA expenses. • Dr.

Service testified that he did not know that the defendant was using an OPA debit card. • Dr. Service testified that cell phones and internet costs were not reimbursed by the OPA. • Ms. DiDonato testified that the defendant did not give her cash to reimburse the OPA payment of the defendant’s entire credit card bill. [ 27 ] Most importantly is the issue of records of the OPA that were discovered by Ryan Morley and Janet Kasperski during their investigation. Ms.

Mardonet was questioned regarding her contention that two years of financial records (containing bank statements, financial statements and invoices) were left available in the credenza beside her desk and that at least 50 boxes of records from prior years were in the storage room. She could not understand how they could have been missed by Mr. Morley and/or Ms. Kasperski during the search. [ 28 ] Ms. Mardonet was also asked in cross-examination to explain the offer made to Dr. Berman to reimburse the OPA $10,000. Ms. Mardonet explained to Dr. Berman that she could not speak to Ms.

Kasperski and wanted her to act as an intermediary. Because of the method of intermingling personal and business expenses, Mardonet felt she owed the OPA some money at the end of the year. She wanted Mr. Berman to explain to Ms. Kasperski how the accounting was handled. Again, Ms. Mardonet does not understand why Dr. Berman testified that he had no idea about that method of accounting generally, and no recollection of a discussion regarding paying back the OPA. Findings [ 29 ] Let me say that anyone in Ms.

Kasperski’s position, taking over this entity as the top executive, would be alarmed when the books were viewed. Possessed not only with an affidavit from an employee (Ms. DiDonato) which alleged malfeasance by another employee (the defendant), and accounting entries and bank records which, on their surface, suggested the same thing, would cause any responsible leader to investigate. Defence admitted, right at the outset, that there would be many examples of OPA funds used to pay clearly personal expenses of the defendant and that the personal expenses and business expenses were intermingled.

So, it is obvious that an investigation needed to be undertaken.

[30] The difficulty I had was with the execution of the investigation and, to some lesser degree, with the desire of Ms. Kasperskito find fraud. In my view, the investigation was conducted unprofessionally and with a bias towards finding fraud. I am not at allsatisfied that the forensic accountant received all of the financial documents that existed. And, not surprisingly, I did not find Ms.Kasperski to be an unbiased witness, I had concerns regarding the following: • Ms. Kasperski had to be reminded on numerous occasions by the Court to answer the question asked, not the one she wanted toanswer. • When Ms.

Kasperski did answer a simple question, she often expanded upon that simple answer with more information thatmight assist her position. • After having been asked about the months before Ms. Kasperski went to the police (in May 2014) when Ms. Mardonet (withcounsel) told her that all supporting documentation would be located at the OPA or with BDO, Ms. Kasperski admitted she did notreceive any information from BDO and does not know what documents BDO possessed. (Transcript dated January 21, 2016 – pages 124,159). • Ms.

Kasperski was aware that BDO prepared an audit review every year, and the accounting firm had conducted a special auditat the request of the OPA concerning Ms. DiDonato’s complaints and was aware that the auditing process did not reveal any financialimproprieties by Ms. Mardonet. • Ms. Kasperski admitted that when she contacted the insurance company regarding “fraud insurance” the OPA held, she was toldthe police needed to be alerted, and that the company might be denied coverage under certain circumstances.

At first she denied beingtold that coverage would be denied if negligence was found on the part of management, then a few minutes later, acknowledged that sheunderstood that to be the case. [31] Ms. Kasperski agreed in cross-examination that it was only Mr. Morley who provided the material that the forensicaccountant (Mr. Ferguson) received. Mr. Morley had worked for her before, and she trusted him. Mr. Morley admitted that he had “notraining or experience” in accounting and he didn’t possess the prerequisite qualifications for the job he was given. [32] Mr.

Morley began his investigation by looking for financial documents as directed by Ms. Kasperski. He found some in thefiling cabinet located in Ms. Mardonet’s office as was expected, and he was aware that there were boxes in the basement storage area. Hetold the Crown that there were close to 70 unlabelled boxes on shelves in that basement. In cross-examination he agreed that Ms.Mardonet (with counsel) attended the OPA offices in January 2014 where she pointed to a number of boxes that Mr. Morley had not yetexamined. Mr. Morley estimated between 15 and 17 boxes were pointed out by Ms.

Mardonet and were taken upstairs to the office. Therest of the boxes stayed in the basement. Mr. Morley maintained that he examined the boxes left in the basement but, obviously, theseboxes were not disclosed to Mr. Ferguson. [33] Mr. Morley also agreed that he was told (by counsel in writing) that BDO possessed other records relevant to his enquiry. Hedid not recall receiving records from the auditors. In the records he did look at, it was clear to see that Ms. Mardonet’s and her husband’scredit card statements were attached to OPA cheques. It was clear that the OPA was paying for personal expenses.

Other documents, likebank statements, clearly showed OPA debit card purchases at retail stores or other personal vendors. [34] And finally, regarding the issue of the police investigation, Morley agreed that he was not aware of any search warrant orproduction order. He did not remember any request by the police for any document. He also had no memory of producing documentationfor the police. [35] In

summary, the collecting of evidence was not performed by professional investigators, was directed by an executive thatwas motivated to find fraud, and was carried out by an assistant not qualified for the job. I am persuaded that Mr. Ferguson did aprofessional investigation based on all of the information he received but, in my view, it would be dangerous to conclude guilt basedupon a clearly less than thorough investigation.

He simply did not have the complete picture. [36] Before leaving my assessment of the investigation, I must comment on the third party records application that was brought bydefence during these proceedings. Among other things, 37,000 emails to which the defendant was party to either as sender, recipient orcopied, were not initially disclosed. After finding likely relevance, I was grateful to the parties that any decision I might be required tomake as to actual relevance was abrogated by agreement.

Firstly, it was difficult for this Court to understand how the defendant wouldnot be accorded access to her emails given that she had possessed them at one time in the OPA history. Add to that the historicalimportance that an email trail often provides as to what was said or known at the time by the parties identified.Finally, it was obviousthroughout the case that information in these emails actually assisted the defendant.

In my view, the initial reluctance to disclosedocuments underlines a theme of an incomplete, and therefore compromised, investigation. [37] Central to this case was the testimony of the defendant in contrast to that of Dr. Berman, Dr. Service and Ms. DiDonato.Essentially the defendant testified that all expenses were verified as personal or business by invoice (or similar proof) and accounted forin that respective year. The three witnesses above essentially rebut that contention, and assert denial or ignorance regarding thebookkeeping and accounting procedures professed by the defendant.

I must admit some ambivalence in my assessment of these crucialcontradictions. Ms. Mardonet was clear, cogent and persuasive in her position. Her answers were direct and thoughtful. That said, shewas contradicted by three credible witnesses and the amounts of money that were moving from the OPA to her accounts by variousmethods were outrageous for an organization with annual revenues somewhere just north of $500,000. [38] Of course, for some time now, credibility assessments undertaken in the context of conflicting testimonial accounts have beenguided by the suggestions of the Supreme Court of Canada in R. v.

D.(W.), (SCC), [1991] 1 S.C.R. 742: A trial judge might well instruct the jury on the question of credibility along these lines: First, if you believe the evidence of the accused, obviously you must acquit.

Second, if you do not believe the testimony of the accused but you are left in reasonable doubt by it, you must acquit. Third, even if you are not left in doubt by the evidence of the accused, you must ask yourself whether, on the basis of the evidence which you do accept, you are convinced beyond a reasonable doubt by that evidence of the guilt of the accused. (D. (W.) , pp. 757-758) [ 39 ] Although I concluded that I could not reject the defendant’s evidence, I did have trouble with her evidence on the following points: • The defendant testified that Dr.

Berman was aware that the OPA paid the defendant’s personal credit card bills and that reimbursement to the OPA would occur later. When pressed as to when that repayment would occur, the defendant said that it needed to be done at the end of the year, then changed that to the end of the month. She paid cash, rarely by cheque, to Ms. DiDonato. Dr. Berman testified that was not a practice she was aware of and would not have agreed to. Ms. DiDonato said it didn’t happen. The defendant’s explanation was that her husband received cash from his work, and the OPA always needed cash, so it made sense.

Given such an unusual accounting procedure, it is difficult to accept that the defendant would not have insisted on a “paper trail” (as a cheque would provide) to prove that she was repaying the OPA. • Many of the specific, ostensibly personal, expenses charged to the OPA were explained by the defendant as gifts to staff and others. I was struck by the frequency of expensive gifts outlined in the defendant’s evidence. It seemed to me to be a facile attempt to legitimize personal expenses. • On many occasions Ms.

Mardonet used the OPA debit card for personal purchases instead of her own card because they looked the same and had the same PIN. I find that explanation unsatisfactory. • The defendant’s evidence regarding office accounting procedures was contradicted in many significant instances (see paragraph 24) by both executive directors, and a colleague. However, it should be noted that no inside officer or employee witnessed any fraudulent actions of the defendant and no officer or employee (with the exception of Ms.

DiDonato) even reported any misgivings during their tenure. • The defendant was shown a number of cheques signed by her alone, and those signed or initialled by Dr. Berman that same day . The defendant was asked why the cheques initialled or signed by Dr. Berman were legitimate OPA expenses, but the cheques payable to Ms. Mardonet or cash possessed only the defendant’s signature. The Crown referred to five such occasions in 2008 and 2009. The defendant explained that it would be difficult to remember that far back but sometimes Dr. Berman left for the day early.

In my view, this was an inadequate explanation, and it doesn’t explain why, consistently, the cheques to Ms. Mardonet and cash were signed only by Ms. Mardonet. • The defendant was aware that Ms. Kasperski suspected fraud because she viewed emails that suggested exactly that. It occurs to me that some of the missing documents in this case could be explained by an inference that Ms. Mardonet got rid of them. That, however, does not explain missing invoices since they would be crucial to the defendant in supporting her position that expenses were legitimate.

Of course, it is also possible that invoices never existed in the first place. • Ms Mardonet’s explanation of the reason for the offer of a $10,000 payment to the OPA (via Dr. Berman) rings hollow. She testified it was to compensate the OPA for what she owed them. In fact, she offered to pay an amount probably greater than what was required to satisfy the debit. It is difficult to believe that an employee who has conducted herself honestly for 24 years and, in her view, fired unfairly, would offer to pay that same organization more than she owed them. Conclusion [ 40 ] Accordingly, applying W.D.

I do not believe the defendant, but her evidence, and the evidence of an inadequate investigation, created a reasonable doubt. So, in conclusion, while I find that it is quite probable that the defendant acted dishonestly given the sheer volume and frequency of undocumented cash moving from the OPA to her accounts, I am left with a reasonable doubt, and the defendant will be found not guilty. Released: December 19, 2016 Signed: “Justice Blouin”