TORONTO - A sweeping review has been ordered to root out any spending abuses at Ontario government agencies following revelations of questionable expenses at the troubled lottery and gaming corporation, Finance Minister Dwight Duncan said Monday.
Duncan announced the review after cleaning house at the Ontario Lottery and Gaming Corp., which has been mired in controversy for years over, among other things, questionable insider wins.
The management team put in place to clean up the OLG is gone, including its six-member board of directors and its CEO, Kelly McDougald, Duncan said.
The agency's board resigned and were replaced by senior bureaucrats, who fired McDougald as their first order of business, he said.
McDougald, who was hired in 2007 to clean up the agency, was "dismissed with cause" and will not receive severance, Duncan added.
The auditor general has also been brought in to review questionable expenses at the OLG, which included expensive dinners, gym and golf memberships and even a $30 car wash.
"I am disappointed with what has been brought to my attention," said Duncan, who took over responsibility of the agency in June.
"The expenses are a symptom of much larger problem."
Premier Dalton McGuinty will unveil a broader set of accountability measures on Tuesday, including details of the accountability review of Ontario's agencies, boards and commissions.
The shakeup at the OLG came after Duncan's office found questionable expenses claims going back years.
They included $1,000 for the cancellation of a deposit on a Florida condo by Michael Sharland, the OLG's former vice-president of security and surveillance who took a paid leave of absence in 2007.
David Myers, vice-president of lottery operations, billed the OLG $3,713 for a business dinner for 38 people, which included 15 bottles of wine.
Another OLG executive charged the agency nearly $500 for a nanny so that she could attend meetings during a four-month period in 2006, which she repaid.
Senior staff also billed the agency for golf, gym and Weight Watchers memberships, as well as small items like a $7.70 pen refill and a $1.12 cloth grocery bag.
The expenses were among hundreds of pages released by Duncan's office Monday which detailed expenses filed by OLG executives and senior staff since 2007.
It's the second Ontario government agency to get a major overhaul in the last few months.
eHealth Ontario CEO Sarah Kramer and board chairman Dr. Alan Hudson both left that troubled agency, which awarded lucrative contracts to consultants without competitive tenders.
Opposition parties accused the government of trying to defuse a scandal that would have been brought to light through their freedom of information requests.
The OLG's problems were well-known for years, yet two other cabinet ministers who were responsible for the agency over the last two years failed to fix it, said New Democrat Michael Prue.
"Now you have a minister who says he only just found out," he said.
"To fire someone with cause ... There has to be huge amounts of wrongdoing to take such drastic action, and I do not believe for a minute that they didn't know about this."
The problems at the OLG are the "tip of the iceberg," said Progressive Conservative Peter Shurman.
"You've got eHealth, you've got this, and I think in the future you're going to see more."
The OLG issued a statement Monday calling some of the expenses "unacceptable" and said it would co-operate with the auditor's review.
The lottery agency has been dogged by troubles over the last few years, from questionable insider wins to botched scratch-and-win tickets and malfunctioning slot machines.
In March, OLG executives were read the riot act by Infrastructure and Energy Minister George Smitherman for buying foreign cars as casino prizes at a time when thousands of Ontario auto workers were losing their jobs.
Duncan took over responsibility for the agency in June.
The agency has been trying to rebuild consumer confidence and enhance security since a scathing 2007 report by Ontario Ombudsman Andre Marin, who accused unscrupulous retailers of collecting tens of millions of dollars in "dishonest" winnings -- and the lottery corporation of letting them get away with it.
Marin had given the agency until early September to report back to him about cleaning up its act.
Unless the OLG could show him that "rampant fraud" was purged from the system, Marin said he was prepared to press the government to ban all retailers and lottery insiders from playing.
He imposed the deadline after a sweeping forensic audit in February revealed lottery insiders in Ontario won prizes totalling $198 million over the past 13 years.
All insider wins have been directly investigated by the police branch of the Alcohol and Gaming Commission of Ontario since Jan. 1, 2008, and they have since laid several charges.
