Editorial: Follow the Dollars

Published in the Manitoba Co-Operator
Editorial: Follow the Dollars
By Gord Gilmour
Published: July 12, 2018
Editorial, Opinion

Most financial professionals will tell you to keep one hand on your wallet when someone doesn’t want you to look at the books.
From non-profit community groups to major corporations, the numbers don’t lie. If funds have been misallocated or things aren’t quite on the level, it can’t truly be hidden.
No matter how hard someone tries to cover it up, there’s always a loose end, a number that doesn’t quite add up, and a fresh set of eyes will cause that to jump out off the ledger and reveal the truth.

Some companies even force key financial staff to take vacations just to ensure some oversight.
It’s for this reason the federal government’s steadfast refusal — spanning two successive federal governments of two distinct political stripes — to provide a full and open accounting of the Canadian Wheat Board’s final year is so troubling.

In December 2014 the Globe and Mail newspaper noted the latest fulsome financial report it could find on the CWB’s website dated from 2011-12.
It noted the company was clearly up for sale, had been on a buying and building spree and was “allegedly” prosperous, but noted the choice of that word was necessary because there was no hard proof one way or the other.

Just four months later, in April of 2015, the sale of the CWB to a joint venture of Bunge Canada and Saudi Agricultural and Livestock Investment Company (SALIC) Canada was announced. That entity paid $250 million for 50.1 per cent of the CWB, and rebranded it G3 Global Grain Group.
The remaining 49.9 would “… eventually be acquired by producer patrons of the CWB, who will receive $5 of equity for every tonne of grain sold to the CWB,” according to Martin Cash of the Winnipeg Free Press.

•Read more: [Editorial] The farmers’ (equity) trust in the CWB

Since then there’s been, from some quarters, claims that the deal was sweetened, with money owed to farmers, in an attempt to kill off the CWB once and for all.
There’s little doubt then agriculture minister Gerry Ritz wanted a deal done. It’s impossible to say for sure why, but it’s also impossible to ignore that, politically, it was an expedient solution for him.

So long as the organization remained more or less intact, it would always be a rallying point for those who sought to have the single sales desk reinstated.
Recreated as a privately controlled subsidiary of two global organizations, no such residual sway would linger.
One might think the current Liberal government would be anxious to shine a spotlight on such skulduggery. Instead it seems set on all but ignoring the issue, when not actively blocking efforts to have the numbers reviewed.

•Read more: CWB sale to be scrutinized by new Liberal government

Despite repeated requests from some groups — notably the National Farmers Union and the Canadian Wheat Board Alliance — the government has been steadfast in its reluctance to open the books.
In no small part that’s probably because if there was any wrongdoing, legal or moral, it’s going to be an expensive mistake to fix, measured in hundreds of millions of dollars.
No doubt the current government has other things it would like to spend that kind of cash on, rather than redressing something that happened under a previous government.
Slowly, however, there seems to be some movement towards a final accounting. Most recently the Manitoba Court of Queen’s Bench ruled against Ottawa, which was requesting the court strike the statement of claim.

•Read more: CWB class action suit takes step forward

It doesn’t necessarily mean the lawsuit will go ahead, but it is one key hurdle cleared.

The allegations in that as-yet-unproven statement of claim are interesting to all farmers who sold wheat and barley through the organization.
In simple terms, the plaintiffs allege the feds funnelled a total of $151 million to the ultimate buyers of the organization. They say $145.2 million was placed in an expanded “contingency fund” and $5.9 million was taken from pool accounts.

“In order to fund the transformation of the board to a privately held entity, the defendants engaged in a course of conduct intended to reduce payments to farmers who had sold and delivered grain to the board during the class period and to increase the monies in the contingency fund,” the statement of claim alleges.

What has been curious is the deafening silence by most farmers and farm groups on this topic. Back in the days of the single desk one could hardly go 10 days without a press release alleging wasteful mismanagement in some form. Not so today.

It’s likely most don’t want to get stuck in the quagmire of the CWB debate again, and that’s understandable. But asking for a full accounting of what went on is a far cry from going back in time.

The numbers really add up, and shouldn’t be ignored. If the numbers in the lawsuit are accurate, for each of the 70,000 farmers the CWB did business with, that equals $21,571.

Wouldn’t you like to know if that should be in your pocket?

Grain giants and family farmers — the untold story of losing the Canadian Wheat Board. Published on Rabble.ca on June 26, 2019

These are not great days for farmers across Canada. A drought in many parts of the Prairies prompted worried looks and constant gazes skyward for any sign of cloud cover. Then, at almost the final hour for many, it rained — lots of rain. In some places seeded crops had yet to germinate, but then the rain came. As I write, rain is falling in some parts, but will it be enough?

Would that weather was the only major risk in farming…

A few weeks ago, Statistics Canada released its report on farm incomes, noting that across the country farmers’ net income has dropped by 45 per cent, and in Saskatchewan by close to 29 per cent.

All of this is only compounded by the fact that farm policy in this country has been continuously eroded over decades by negligence, trade agreements, lack of foresight, and even, some suspect, outright corruption.

Both Conservative and Liberal governments have removed or ignored the few programs that might have helped farmers gain access to a better market share, a better price for their product, and assure international buyers quality control of the grain purchased. A significant source of support for farmers was the Canadian Wheat Board, a marketing board for grain in Western Canada.

In late May the Friends of Canadian Wheat Board (FCWB) was once again in court, asking that the Manitoba Court of Queen’s Bench certify a class action lawsuit to regain more than $152 million owed farmers for the final payment from Canadian Wheat Board (CWB) grain sales for the 2010-2012 crop years. At that time the federal Conservatives were dismantling the CWB and apparently diverting funds that were meant for farmers. Farmers never received all of their final payment. The Manitoba court will rule in a few months.

What is the Canadian Wheat Board and what did it do?

The Canadian Wheat Board was established in 1935 as a single selling desk for Canadian grain. Until 2012, it undertook orderly marketing on behalf of farmers. Then it was privatized and its assets transferred to a Saudi agribusiness company and an American-based transnational.

This is indeed a story of David and Goliath — but as all good stories of underdogs and activism, nimbleness is important. These activist farmers are definitely showing their commitment and stamina. They are also nimble. And they will be seen, I believe, to be on the right side of history.

Since 2011 groups of Prairie farmers who support a farmer-controlled CWB have been working to have the courts recognize that the actions taken by the Harper Conservatives to privatize and transfer assets to foreign corporations were in fact illegal and have cost farmers billions in income. But money is not the only issue — access to international markets, quality control of export crops, and issues related to seed, genetically modified crops and their impact on foreign sales of Canadian product, are just some of the topics that farmers elected to the CWB engaged on. The Wheat Board worked to maintain decent prices for grain commodities. And that was also in the interests of the country and all Canadians more generally. With the loss of the CWB, I have no doubt that we are losing more farmers.

Since 2012, the FCWB has been walking through the legal maze fighting for justice on behalf of farmers. First, the FCWB fought the restructuring of the CWB, and the dismantling of its farmer-elected structure. Then, it was essentially privatized in 2015 and its assets transferred by the federal government to the G3 Global Trading Group, a company owned by Saudi Arabia agribusiness and an American-based transnational. The FCWB has long maintained that all of the $17 billion in Wheat Board assets were common property of farmers and the Canadian public, and that the federal minister of agriculture at the time — Gerry Ritz — overstepped his elected role to destroy the Wheat Board and transfer its assets to foreign ownership.

Multiple legal actions

The court battles to seek approval for a class action suit have been numerous and lengthy — and along the way there have been wins and losses.

These are chronicled in detail on the site of the Canadian Wheat Board Alliance, a group which also supports the CWB. Farmers have gone to the courts asking for $17 billion in damages for hard and soft assets (hopper cars, buildings, shipping vessels, and moneys for grain sales) that belong to farmers and were essentially transferred to new owners without proper consultation. In a complicated and narrow decision related to property rights, the Federal Court of Canada determined that only parts of the case might be heard — and that the assets were not common property. But both courts, the Federal Court and the Federal Court of Appeal, allowed that a suit for farmer grain payments could be heard. Application for that class action is now being heard in the Manitoba Court of Queen’s Bench. The statement of claim can be found here.

Besides the diversion of crop income away from farmers from 2010-2012, activist farmers initiated legal action in 2011 challenging changes in the legislation governing the CWB and lack of farmer input. Then, in 2012, farmers launched a class action suit against the federal government for selling what farmers claimed were farmer-owned business assets and common property — the Canadian Wheat Board — and to reclaim final payments for grain sold on behalf of farmers by the board. The FCWB is adamant that both farmers and the public owned these assets and have actually lost billions in common property in the sale of the CWB.

Lack of federal support

Meanwhile, since the election of the Liberals in fall 2015, the FCWB has been meeting with the federal government, urging a full accounting of what happened to the CWB by the previous Conservative government and its minister, and the reinstatement of the CWB or a similar marketing board.

While in opposition the Liberals dogged the Conservatives over the dismantling of the Wheat Board. But once elected, they went largely silent and have been trying to delay the Manitoba hearings on technicalities, according to the FCWB.

Stewart Wells, Chair of the FCWB, and a former farmer-elected director of the CWB, explained it this way when interviewed by the Manitoba Cooperator on June 7:

“When we started this in February of 2012 we were prepared for a lengthy process,” Wells said. “Now it could’ve all been ended if the Liberal government wouldn’t have continued the coverup started by the Harper government. So we find ourselves still trying to get to the truth of what happened in 2010, 2011 and 2012 and get cash back to the farmers that they were deprived of during the transition process.”

There are calculations as to how much the sale of the single selling desk is undermining Canadian farmers’ income. In 2015 University of Saskatchewan agricultural economist Rich Gray published findings showing that up to that point Canadian farmers had lost more than $7 billion in reduced sales and pricing of grain commodities due to the loss of the Wheat Board.

Compound that amount to date and we have one reason why Western farmers’ income has plummeted so dramatically. Add to that low prices, increases in input costs and farm machinery costs.

Canadian family farmers have a lot more than just the weather to contend with. So do we all, when you consider that neither Conservative or Liberal governments have ever extended much support to family farmers.

“It’s about treating people, in this case farmers, fairly,” Wells said. “Some of those same people… would be mortified if somebody stole $5 from them… well this is a little different because these injustices have been delivered by… the federal government.”

“It’s just not appropriate to walk away and turn a blind eye when you see governments doing something inappropriate,” he added.

And when you look at dwindling farm income due to the loss of orderly marketing, farmers and Canadians have lost much, much more.

Those of us who know that the story of the Canadian Wheat Board is unjust and a story that remains untold are hoping that David’s slingshot hits its target.

Lois Ross is a communications specialist, writer, and editor, living in Ottawa. Her column “At the farm gate” discusses issues that are key to food production here in Canada as well as internationally.

Proposed CWB class-action lawsuit takes another turn. Published in the Manitoba Co-operator on June 7, 2019

A proposed class-action lawsuit against the federal government and G3 alleging farmers’ money helped privatize the Canadian Wheat Board (CWB) continues to slowly make its way through the courts.

A year ago the Friends of the Canadian Wheat Board, which supports the proposed lawsuit, was jubilant. On May 28, 2018 Master Shayne Berthaudin of the Manitoba Court of Queens Bench in Winnipeg ruled against the government’s attempt to walk away from the proposed class action, which claims more than $145 million in damages are owed to the farmers who delivered wheat and barley to the CWB in the 2010-11 and 2011-12 crop years, along with $10 million in punitive damages.

But the current Liberal government appealed so the farmers were making their case again May 28, 2019 before Court of Queen’s Bench Justice Chris Martin.

“It seems never ending,” Friends of the Canadian Wheat Board chair Stewart Wells, who farms at Swift Current, Sask., said in an interview May 28. “That is why the court system is so frustrating.”

A ruling is expected in a month or two, Wells said. If Justice Martin upholds the earlier ruling, farmers can then move to certify the class-action lawsuit, he added.

If it goes the other way the farmers will likely appeal, “but I am just speculating now,” Wells said.

Before getting elected in 2015 the Liberal party said it would render a full accounting of the Harper government’s winding down of the CWB, Wells said. That didn’t happen and instead the Liberal government is trying to block farmers’ efforts.

“When we started this in February of 2012 we were prepared for a lengthy process,” Wells said. “Now it could’ve all been ended if the Liberal government wouldn’t have continued the coverup started by the Harper government. So we find ourselves still trying to get to the truth of what happened in 2010, 2011 and 2012 and get cash back to the farmers that they were deprived of during the transition process.”

The suit alleges the federal government used $7 million of money owed to farmers through the CWB’s pool accounts and $100 million more from the CWB’s contingency fund, plus interest.

The allegations have not been tested in court.

Ottawa ended the CWB almost seven years ago. To those rolling their eyes over the suit, Wells says the issue goes beyond the money to an important principle.

“It’s about treating people, in this case farmers, fairly,” he said. “Some of those same people… would be mortified if somebody stole $5 from them… well this is a little different because these injustices have been delivered by… the federal government. It’s just not appropriate to walk away and turn a blind eye when you see governments doing something inappropriate.”

The government used farmer money to make the CWB more attractive to its next proprietor, which turned out to be G3, which is a joint venture of U.S. agribusiness Bunge and Saudi Agricultural and Livestock Investment Co. (SALIC), which is owned by the Saudi government.

“If people want to roll their eyes they should think about $150 million to $200 million being handed over to the Crown Prince of Saudi Arabia,” Wells said.

Friends of the Canadian Wheat Board

Court rules Ottawa must answer for Harper actions on CWB
(May 31, 2018, Swift Current, Sk.) The Manitoba Court of Queen’s Bench has ruled Ottawa must answer for the Harper administration’s actions against the farmers who participated in the farmer-controlled Canadian Wheat Board (CWB).
In a written ruling released May 28, 2018, Master Berthaudin ruled against the government’s attempt to walk away from a putative class action which claims more than $145 million in damages are owed to the farmers of western Canada along with $10 million dollars in punitive damages.
“This ruling puts the government’s shirt in the wringer,” said Stewart Wells, Chair of the Friends of the Canadian Wheat Board (FCWB).
“In the proposed class action farmers contend the former Minister of Agriculture, Gerry Ritz, deprived farmers of monies they should have received from the 2010 and 2011 crop years. Instead of paying farmers, we believe this money was used to sweeten the pot for whoever was going to acquire the Wheat Board” Wells explained.
The government of Saudi Arabia and the multinational grain company Bunge ultimately acquired the Wheat Board from the Government of Canada, and created G3 Global Grain Group to assume the assets of the former CWB in 2015.
Anders Bruun, a Winnipeg lawyer noted: “the CWB’s annual reports for those crop years issued after the farmer elected directors were dismissed show that farmers were short changed by over $140 million even though the CWB Act required that money to be paid to farmers as part of their final payments for those crop years.”
Bruun is representing the class’ proposed representative plaintiff, Brookdale, Manitoba farmer Andrew Dennis, together with Jordan Goldblatt and Louis Century who are Toronto based lawyers specializing in civil litigation and class proceedings.
With this week’s ruling, the Court clears the way to the next step which is a hearing to have the action certified as a class action, with Mr. Dennis as representative plaintiff.
The action was commenced in 2012 with the support of the Friends of the Canadian Wheat Board on behalf of all prairie wheat and barley farmers. – 30 –
For further information:
ANDERS BRUUN, Barrister and Solicitor

New lawsuit claims CWB kept $145 million of farmers’ money

New lawsuit claims CWB kept $145 million of farmers’ money

April 24, 2017 – Manitoba Cooperator

Lawsuit alleges farmers short changed $151 million as CWB wound down according to a statement of claim $145 million was transferred from the CWB’s pool accounts to its contingency fund.

Brookdale Manitoba farmer Andrew Dennis has filed a statement of claim in the Manitoba Court of Queens Bench claiming the now-defunct Canadian Wheat Board (CWB) withheld money owed to farmers to help finance its transition to a private grain company.

Dennis is seeking certification of a class action lawsuit on behalf of all farmers who delivered wheat and barley to the single desk marketing agency during the two crop years preceding the end of its monopoly on marketing in 2012.

The statement of claim names the Government of Canada, G3 Global Grain Group and G3 Limited as Defendants. G3 is the private entity which acquired the CWB following a July 31, 2015, transaction.

“When we were reviewing the CWB’s Annual Reports for 2010-11 and 2011-12, it appeared that $145 million, which should have been paid to farmers as part of their final payment, had been withheld and transferred to the CWB’s Contingency Fund,” said Dennis in a release.

“This claim is about establishing accountability for the disposition of the Canadian Wheat Board, allocating financial responsibility to the appropriate parties, and ultimately getting any funds recovered back to prairie farmers,” said Stewart Wells, a farmer from Swift Current, Saskatchewan and chairperson of the Friends of the Canadian Wheat Board.

Anders Bruun, one of the lead lawyers for the plaintiff went on to note that “Some restructuring expenses were paid from the pooling accounts, but the Contingency Fund appears to be the largest single source of apparently misappropriated funds.”

Dennis was previously part of a claim against the government and the CWB in the Federal Court. On May 15, 2017, his lawyers will be seeking leave to discontinue the Federal Court proceeding in favour of the Manitoba Court Class Action.

Bruun is representing the lead plaintiff together with Steven Shrybman of Goldblatt Partners, a Toronto and Ottawa law firm specializing in class actions and Jordan Goldblatt of Adair Barristers, Toronto which also has substantial class action litigation experience.

The statement of claim may be viewed and/or downloaded at www.cwbafacts.ca/wp-content/uploads/2017/04/SOC-Manitoba-Apr-24-2017.pdf.