Accounting firm clears former Regional councillor in campaign finance complaint leveled by activist Ed Smith
BY JOHN CHICK
Special to the VOICE
Former Niagara Regional Councillor Tony Quirk, of Grimsby, has been cleared by a third-party audit after a complaint from a resident over previous campaign finances.
Accounting firm MNP last Monday released the findings of its report, determining Quirk was compliant under the Ontario Municipal Elections Act when a man named Derek Holmes performed an audit for him valued at $250 during Quirk’s failed 2018 re-election campaign. Holmes was also recorded donating $500 to Quirk’s campaign.
The sums became an issue when Ed Smith, a community activist and current member of the Niagara Peninsula Conservation Authority (NPCA) board, filed a complaint based on his assertion that fair market value for auditing services is approximately $1,600, meaning that Holmes’ total contributions to Quirk’s campaign may have exceeded the $1,200 limit for an individual—as stipulated in the Municipal Elections Act.
Smith, a former Armed Forces officer who now leads the advocacy group A Better Niagara, said in his initial motion in May that the situation amounted to an in-kind campaign donation from Holmes to Quirk.
“I believe that Mr. Holmes’ audit was an in-kind donation,” wrote Smith in his complaint. “Which would suggest this total contribution was $2,200, in excess of the maximum individual contribution limit of $1,200.”
MNP disagreed, saying Quirk properly disclosed the value of Holmes’ auditing services, adding that that a separate auditor provided services valued at $226 for another regional candidate.
“Mr. Quirk obtained a rate of $300 from his accountant,” the report read. “MNP notes that while a weighted average rate of $300 provided by Mr. Quirk’s accountant would be appropriate for a professional accounting firm, the rate would be high for a retired practitioner who does not have the costs associated with maintaining a practice. As such the rate of $300 is likely high for estimating the fair value of the services performed by the campaign auditor.”
If the allegation sounds trivial, it’s because bad blood appears to have existed between Quirk and Smith dating back several years.
“The [MNP] audit speaks for itself,” Quirk told the Voice. “I never had any doubt that an audit would completely vindicate me. I am just frustrated as a taxpayer that, once again, we are paying to investigate Ed Smith’s false accusations and delusions.”
The Voice estimates the cost of the audit to exceed $10,000, an amount to be charged to Niagara taxpayers.
“Yet again A Better Niagara tries to use the system to settle scores.” Quirk wondered if Smith and A Better Niagara would be so quick to demand audits and investigations if they had to cover the costs.
“If they had to use their own money instead of taxpayers’ money, would they be making these defamatory accusations?”
Smith mostly declined comment over the weekend, saying anything he could say about MNP’s report would be “speculative” ahead of response from the Niagara Compliance Audit Committee —which, to his understanding, must be reconvened before a “final decision” is made.
“Only the Audit committee can decide what the outcome is and therefore I need to wait for their decision,” Smith said.
According to the MNP report, the critical issue to Smith’s application related to the “fair value” of the audit services that Holmes performed for Quirk.
“The Election’s Act’s definition relies on an assessment of the lowest amount a business would charge for the service,” the report stated. “The applicant submitted that the fair value of the audit services claimed by the candidate was not reasonable based upon a comparison to the average of other filings. The use of average values may be appropriate in some cases to obtain a range of values or to identify potential anomalies, however the use of comparable averages is not a definitive analysis due to the number of variables that can impact costs.”
Smith’s recent naming to the NPCA Board comes two years after the same conservation authority sued the St. Catharines resident for $100,000 for defamation over his distribution of a report entitled, “A Call for Accountability at the Niagara Peninsula Conservation Authority.”
The following year a judge threw out the lawsuit, saying the claim against Smith was “designed to silence the defendant, who was an annoyance to the authority.” The judge also ordered the NPCA and former CAO Carmen D’Angelo to pay Smith $131,000 in legal costs. D’Angelo would later become Niagara Region CAO, before leaving under a cloud of controversy and suing the Region himself —while the NPCA has since seen mass turnover and a damning report by the Ontario Auditor General.
For its part, this wasn’t the first time that the group A Better Niagara went after a former Regional councillor with regard to campaign expenses. In July, Sandy Annunziata appeared before Regional Council’s Audit Compliance Committee to address a complaint about his campaign finances brought forward by Dennis Edell, a director on A Better Niagara’s board.
Annunziata needed about seven minutes to quash the allegations against him. After Annunziata explained how he negotiated the rental of a billboard, Edell withdrew his complaint.
“It’s unfortunate that A Better Niagara wants to weaponize the Niagara Compliance Audit Committee. I’m grateful the committee was thoughtful enough to see through that deception,” said Annunziata.
With additional reporting by Kevin Vallier