A senior executive at the Alberta Securities Commission (ASC) who was fired in April has filed a wrongful dismissal suit against Canada's second-largest regulator in which he claims he was fired for being a whistleblower.
Grahame Newton's lawsuit is the latest in a series of allegations against the commission, which include staff harassment and unfairness in enforcement practices.
Alberta Finance Minister Shirley McClellan is one in a long list of defendants in the lawsuit, along with commission executive director David Linder and former chairman Stephen Sibold, whose five-year term expired early in May.
In his statement of claim filed in Court of Queen's Bench, Newton alleges senior management at the commission sought "retribution and reprisal" against him after he "had been identified as a 'whistleblower' regarding certain activities at the market regulator."
The commission oversees most of Canada's largest energy producers, along with such major companies as Canadian Pacific Railway and WestJet Airlines.
The ASC has said Newton was fired from his $160,000-per-year job as head of the commission's administrative services for cause. It says his firing had nothing to do with his raising concerns about enforcement practices and the working environment.
The commission said Newton was dismissed because he tried to block a KPMG computer systems audit and later admitted he had intercepted e-mails and passed them on to part-time commissioners who adjudicate Alberta Securities Act violations.
The ASC said it would not comment on the lawsuit while it is before the courts. "It'll be addressed through the proper legal channels and we'll not have any further comment on Mr. Newton's dismissal," said spokeswoman Joni Delaurier.
Newton was on sick leave, recovering from a heart operation, when he received a letter from the commission saying he'd been fired.
Alberta's opposition parties have claimed his dismissal was part of a "witch hunt" at the commission for employees who had been speaking out about alleged wrongdoings.
Last month, McClellan asked auditor general Fred Dunn to expedite an investigation of the ASC and report his findings by July. But the commission has challenged in court Dunn's authority to conduct a so-called "systems audit."
A ruling on whether Dunn can proceed with his audit is expected this week.
At the heart of the debate is whether Alberta's auditor has the legal right to delve into the commission's books and enforcement practices.
Lawyers for the part-time commissioners argued that such a review would infringe on privacy rights that are guaranteed by Alberta's securities legislation.
"Every single member of the legislative assembly gets a copy of (Dunn's) report, and the next day it comes up in question period," lawyer Brett Code told Justice Dennis Hart of Alberta's Court of Queen's Bench. "And that's important."
Lawyers for the province's auditor argued that his office deals with private information regularly during audits and is also governed by confidentiality obligations.
In his sworn affidavit, Dunn said the purpose of an audit for a provincial agency like the securities commission was to suggest ways of improving systems, procedures and programs.
"Its purpose is not to name individual wrongdoers, if any," said the affidavit. "In the case of a regulated body such as the ASC, a systems audit does not attempt to evaluate merits of regulatory decisions made by that entity."
Under questioning from Justice Hart, Dunn's lawyers denied any possibility that the auditor would "come in and re-decide ASC cases that have already been decided."
The Alberta government has appointed former provincial auditor general Peter Valentine as interim commission chairman.
