RSU not pursuing legal action against students involved in credit card scandal, staff says at first town hall

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By Thea Gribilas, Heidi Lee and Sarah Tomlinson

The Ryerson Students’ Union (RSU) has decided not to pursue legal action against former executives involved in the RSU credit card scandal, an RSU staff member said in a town hall held on May 11.

During the meeting, Reanna Maharaj, the RSU’s executive director said the RSU’s legal counsel advised the union against commencing litigation on individuals allegedly involved in the misuse of RSU credit cards in 2018 and 2019 because “the cost to litigate the matter would be greater than what the RSU would actually recoup from these employees, thus resulting in a greater loss of student money.”

The town hall was held to review the RSU’s audited financial statements for the 2018-19 and 2019-20 academic years. The audited financial statements were initially set to be presented at the RSU’s virtual Annual General Meeting (AGM) on April 30, but it was shut down by the host after failing to meet quorum.

According to a statement issued by the RSU on Jan. 21, 2020, the RSU filed a police report with the Toronto Police Service. However, Maharaj said former RSU president Vanessa Henry decided not to commence litigation against the individuals at the end of the 2019-20 academic year because the process would be too costly. 

A year later, now-former president Ali Yousaf made the same decision, citing the limitation period on civil suits, which sets out a two-year time limit as to when legal proceedings may be commenced by filing a claim, said Maharaj. He also said it would be too costly. 

“The likelihood of them being able to pay back the amount of money is very slim and we would be running a loss as an organization to go after those individuals,” said Maharaj. 

In January 2019, The Eye obtained photos of financial statements showing food, alcohol, clothing and club purchases made with RSU credit cards under the names of executive members, including then-president Ram Ganesh, amounting to more than $250,000. The Eye also confirmed credit card statements under the names of then-vice-president operations Savreen Gosal and financial controller Dharshini Jay detailing illegitimate expenses.

After the university requested the RSU complete a forensic audit of its finances, Henry and Maharaj revealed a “financial review” at the February 2020 AGM conducted by PricewaterhouseCoopers (PwC) that looked into the credit card statements and allegations of misspending.

At the 2020-21 RSU elections debate, presidential candidates, including Yousaf, were asked if they would pursue legal action against Ganesh and the other former credit card holders, if elected.

Yousaf said he would take legal action “if that is what the students want,” adding that the RSU will also get a forensic audit done and commence litigation if doing so could “earn the trust of students back.”

The RSU didn’t directly respond to The Eye’s question about whether or not Ryerson students were consulted in the decision against pursuing legal action.

During the town hall, RSU financial controller Priya Paul said audited numbers for the 2020-21 year will be available next year once there is a 2020-21 audited financial statement. 

“I think you can expect to see somewhat of an update of the unaudited financial numbers when we present the [2021-22] budget to the board,” she added. 

Here’s what else you missed at the RSU’s May town hall reviewing audited financial statements for 2018-19 and 2019-20:

Approximately $2.7 million surplus after 2019-20

Tim Sothern, audit engagement partner with BDO Canada, said there was an overall surplus of approximately $2.7 million following the 2019-20 year, compared to $667,810 after 2018-19. 

The RSU group health and dental plan was the biggest revenue item, bringing in $10.1 million in 2019-20 and $8.5 milion in 2018-19. The second largest revenue item comes from RSU membership fees. 

Sothern said the increase in surplus is related to the excess group health fees collected versus what was paid for the insurance policy. He added that the funds are internally restricted, which means they are restricted from use without the approval of the Board of Directors (BoD). 

Professional expenses up $100,000

In the RSU’s financial statement, professional expenses—fees incurred by seeking professional advice externally—in the 2018 fiscal year were $150,570. In the following 2019 fiscal year, professional expenses increased almost $100,000 to $249,761.

At the town hall, Paul said “a large part of the increase in “legal fees and professional fees” were because of the 2019-20 year, the court case that we had with the university.”

She added that fees incurred by the financial review conducted by PwC to investigate the credit card scandal also contributed to higher fees in the 2019 fiscal year. 

Fostering a healthy work environment 

At the town hall, questions regarding the work environment at the RSU were raised after former vice-president equity Vaishali Vinayak claimed at the April BoD meeting that a motion put forward to impeach her was “racist.”

In response, new RSU president Siddhanth Satish said “the most important thing, as an organization, is to be respectful to each other and move forward in a positive way.”

He acknowledged that in the past “emotions [took] over individuals.” He continued that the behaviour by himself and Yousaf at the AGM last month “should not have happened and [I] will make sure none of this happens this year.” 

Satish said equity and campaign organizer Ruben Perez was at the town hall in an attempt to conduct the meeting in a fair and equitable manner and the RSU will “do our best to make sure that the working environment is positive.”

Poor communication leading up to AGM

When asked why the AGM link was not properly advertised to students in comparison to the town hall meeting and why some executives were absent from the AGM, Satish said there were “complications” with the meeting’s date and that four out of five executives were present. 

“We’ll do our best to market the [next] meeting so we can reach out to as many students as possible,” he said. 

When questioned about previous allegations that team Adapt pressured students into voting for their slate using contact information from the RSU’s Food Box program, Satish said he’s been given three demerit points in punishment. 

“If students don’t feel that their complaints have been heard, I really don’t know what I can do for them,” he said. 

Layoffs in the last year

At the town hall, Maharaj addressed the RSU’s layoffs of frontline staff, including staff at the Good Food Centre, campus groups and former campus groups coordinator Dawn Murray

According to CUPE 1281’s collective agreement, an employee on total layoff without recall or notice of recall shall be deemed terminated after 4 months, which is why Murray was permanently fired and is expected to be replaced in the coming months.  

RSU to hold training sessions for student groups and course unions

In the upcoming year, Maharaj said she hopes to conduct training for student groups and course unions. 

After a year without a course union director and student groups board director, Maharaj said the RSU is looking to fill those positions by having training and orientation sessions in the summer. 

“I would like that to be done,” she said. “This year we are hoping to do things like normal…So we are looking to host all of these normal training sessions and orientations that are typical for all campus groups.”

Satish said the RSU will look into getting more grants or services to course unions and student groups. He also said the RSU plans to launch its menstrual products delivery project and a texting service and phone line for the Centre for Safer Sex and Sexual Violence Support

With files from Emma Sandri, Madi Wong, Sherina Harris, Raneem Alozzi, Alexandra Holyk and Charlize Alcaraz

Comments

  1. Does RSU realize they will be enabling further corruption down the road?
    No punishment and no legal action sets precedence whereby any future RSU administration can squander student money however they like cause they know the student government won’t pursue legal action or even criminal action against them.
    The whole “audit” thing is nothing more than theatre and terrible drama.
    If you all don’t want corruption to happen, the people who squandered and wasted OUR money should be punished and penalized.

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