In 2001, MP Kerry-Lynne Findlay owed so much money that she had to declare bankruptcy. Now, as Minister of National Revenue, the politician from British Colombia is in charge of a $4.3 billion budget. For political experts, the situation raises many questions.
“It’s a little bit ironic that someone who is a minister of National Revenue suffered a personal bankruptcy”, says Cristine De Clercy, who is a professor at the University of Western Ontario and also co-director of the Leadership and Democracy Laboratory.
She is not the only one to think that way. Nelson Wiseman, Director of the Canadian Studies Program at the University of Toronto, says he is surprised the Conservative Party chose her for the job. “A question that you could ask is: Do you think you are in a good position to be the Minister of Revenue in light of the fact that you’ve been bankrupt?”
The 2011 controversial election
Ironically, Findlay’s personal finances became of public interest because of another conservative member that went bankrupt as well.
In 2011, Findlay, who is a lawyer, was seeking the conservative nomination in Delta-Richmond East riding, in British Columbia. However, she lost against Dale Saip, who was at that time Chair of the Delta Board of Education.
It should have been the end for Findlay, but fate decided otherwise. A few days after his nomination as a conservative candidate, Dale Saip had to step down after revelations about his past bankruptcies. In 1993, the candidate owed $289,000 to his creditors and wasn’t able to pay them. Saip also declared bankruptcy in 2004, with $71,000 in debts, and again in 2005, with $102,000 in liabilities.
Therefore, Kerry-Lynne Findlay, who was the next in line, became the conservative candidate for Delta-Richmond East riding, even if she went bankrupt too and with more debts. According to her file in the records of the Superintendent of Bankruptcy, she owed more than half a million in 2001.
Why did Saip have to resign because of his past financial troubles but not her? We contacted Minister Findlay’s office to ask her the question. Her Director of Communications, Rebecca Rogers, answered that the Minister would not comment.
Findlay was elected as MP in May 2011 and then appointed as Minister of National Revenue in July 2013. Her ministry is one of the largest federal departments with 43,000 employees. The previously bankrupt lawyer suddenly became accountable for the government main source of revenue: the 200 billion dollars collected every year through the taxes.
Her financial problems
We asked Findlay’s office why the Minister went bankrupt in 2001, but the question stayed without answer. However, before being elected, Findlay explained to several media outlets that a long judicial battle against the Musqueam Indian Band sank her financially.
In 1999, she also testified in front of the Standing Senate Committee on Aboriginal Peoples about her situation. Findlay was a leaseholder on the Band’s land. The First Nation decided to increase the rent from $450 a year to $35,000 a year. However, the leaseholders and the Band had a contract stating that the rent had to be 6% of the “current value” of the land. Leaseholders and members of the Band couldn’t agree on how to evaluate the value of the site. Therefore, the case went on trial, up to the Supreme Court.
Leaseholders won the case with a decision in their favour on November 9, 2000. Nevertheless, the value of the rental contracts and the houses, built by the leaseholders themselves, dropped. Because of the judicial troubles, the land interested nobody anymore and the financial institutions considered the investment risky.
“Her assets were evaluated at $175,000 at the time,” notes Tim Hill, lawyer specialized in bankruptcy for Boyneclarke law firm, in Halifax. “It was much less than her $557,000 debts.” Hill adds that because of the bankruptcy process, her property was certainly seized and the rest of her debts wiped off. The bankruptcy statement would have stayed in her credit history for six years. “It’s an embarrassment for sure, but at least it, it allows you to have a fresh start,” says Hill.
However, for the lawyer, it is not because someone went bankrupt that he is an incompetent or irresponsible person. “It could happen to anyone.”
But would he trust someone who went bankrupt when money is at stake? “If someone came with a good business idea and asked me: ‘Would like to be my partner?’ If this person was bankrupt in the past, I would probably say no.”
What’s private? What’s public?
In her answer by email to our questions, Findlay’s Director of Communications wrote “this is a very personal matter that was fully resolved over a decade ago.”
However, Nelson Wiseman, professor in political studies at the University of Toronto, strongly disagrees. For him, Kerry-Lynne Findlay’s bankruptcy is not a private matter because she is not a private person. “I gave you another example. If she was convicted of a crime, could she say now ‘it was a private matter’? I don’t think so. Being bankrupt isn’t a crime, but it’s on the public records the same way.”
Cristine De Clercy, professor in political sciences at the University of Western Ontario, underlines that it is normal to have MPs that went bankrupt since over one hundred thousand Canadians declare bankruptcy each year. “The legislature does reflect the composition of the society,” she says. Though voters often want their representatives to be exactly like them, there is a tendency to hold politicians to a higher standard, explains De Clercy. “So there is a bit of a contradiction and it’s a problem in every democracy.” The professor adds that the only counterweight to the problem is to ensure that citizens receive as much information as possible about their candidates “so they can make an informed choice on the day of the vote.”