Complaint of Garth Turner’s trust fund forwarded to Elections Canada

About a year ago, I wrote of Liberal MP Garth Turner collecting money in a unconventional way. Garth Turner was asking contributers via his website to donate to “Garth Turner Campaign, in trust”. We learned then that this may run afoul of the Elections Act because of a recent Federal Accountability Act amendment.

Here is what Turner asked of his website visitors:

Two days ago, I learned from Will Stewart, President of the Conservative Halton electoral district association, that a resident of Halton lodged an official complaint with Elections Canada via registered mail regarding Turner’s request for money to be donated in a trust fund.

Regarding the incident, here’s what I wrote on October 28, 2007,

From Elections Canada, we learn that:

…as of June 12, 2007, as a result of changes made by s. 44(2) of the Federal Accountability Act to s. 404.2 of the Canada Elections Act, transfers of trust funds to candidates from registered parties and registered associations will be prohibited.

It seems that when an election is called, the federal accountability act prohibits the transfer of money from an electoral district association’s or party’s trust fund to a candidate. If this is so, who holds this money in trust? Is it “Garth Turner campaign” (whatever that entity is) or “Garth Turner”? If the account is to be used to elect Garth Turner, it would be useless for the EDA to hold it because of the new changes governed by the FAA. But yet, outside of an election, all funds must be donated to the EDA.

furthermore (from Elections Canada),

A contribution made from a trust fund is treated as a contribution from the trustee.

When a registered party, registered association, candidate, leadership contestant or nomination contestant receives a contribution paid out of funds held in trust, the trustee is reported as the contributor and the contribution counts towards his or her contribution limit.

Therefore, only a trustee who is an individual may make a contribution from a trust fund.

So, Garth is encouraging people to write cheques to “Garth Turner campaign, in trust”. What does this mean? As is the general understanding, and confirmed by Elections Canada, funds held in trust become the property of the trustee. Contributions from trust funds are treated as contributions from the trustee. So, if a candidate were to able to transfer money out of a trust fund to fund their campaign, the maximum they could withdraw would be the maximum contribution amount allowable by an individual (ie. the trustee) per year, which is $1,100. If Garth collects $50,000 into a trust fund from donors, it becomes the property of that trust’s trustee and subsequently, that trustee can only give $1,100. But, can money even be transferred out of a trust (with many contributors) for the purpose of an election campaign?

Trusts are dubious because of the exchanging of money through an intermediary (the trust/trustee). For example, if I wanted to give a political party $100, I couldn’t give it to my friend to donate that money for me. My friend would have to do that in his name because he is the one handing over the money. Again, the nature of trusts is that the money held in trust becomes the property of the trustee and therefore contributing from that trust becomes a donation from the trustee and not the variety of individuals who gave money to put into that trust.

But, as we read on, this becomes clearer. Elections Canada states that indirect contributions are prohibited,

An individual may not collect funds from others in a trust for the purpose of making contributions to registered parties, their associations, candidates, leadership contestants or nomination contestants. (s. 405.3 Canada Elections Act)

This is because individuals cannot make contributions from funds given to them by others for the purpose of making contributions. This rule cannot be avoided by the individual collecting funds in a trust from which to make contributions.

The Liberals have been going on and on about money transfers from parties to candidates and from candidates to parties. Money transfers of this sort happen all of the time. However, according to section 404.2(2.2) of the Elections Act, this may not occur with respect to trusts.

A transfer of funds, other than trust funds, is permitted and is not a contribution for the purposes of this Act if it is

(a) from a registered party to a candidate endorsed by the party; or

(b) from a registered association to a candidate endorsed by the party with which the association is affiliated.

and according to Elections Canada,

A registered party, registered association, candidate, leadership contestant or nomination contestant may not avoid Canada Elections Act controls by collecting contributions directly in a trust fund.

Any such contributions remain contributions. They must be accepted by the relevant agent, put into the campaign account (*** ie. during a campaign, for a candidate as recognized by a returning officer during a writ period — Stephen ***) (if received by a candidate, leadership or nomination contestant) and reported as contributions.

Outside of a campaign, donations for the purpose of eventually electing somebody must be made to the Electoral District Association.

Why is Garth collecting money from his supporters into a trust?

Who owns (and therefore controls) the money in that trust since an EDA cannot transfer money from a trust to a candidate during a campaign?

How would a candidate expect to get more than $1,100 a year out of such a trust?

If a trust is made up of pooled money from a number of people, how can money be transferred to a campaign since indirect contributions are prohibited?

If during a writ period, only a campaign can issue tax receipts and if outside of a campaign, only an EDA can issue tax receipts, how can “Garth Turner campaign” hope to give tax receipts to donors as his website claims?

How much money has Garth Turner collected in trust?

Here’s what Garth had to say about this:

Mr. Taylor has written a blog of copious length after looking at my fund-raising web site (www.garthturner.com). He saw that in addition to credit card donations, I was accepting cheques, made payable to “Garth Turner Campaign, in Trust.” From that he made the assumption (since he did not call me) that I had opened a trust account, and wondered then how the new election financing rules would allow donors to get a tax receipt. I won’t trouble you with all the grinding details, since you can read them on Mr. Taylor’s blogette for yourself (www.stephentaylor.ca). But you can see from his effort on this that he thinks it’s a big deal. Maybe it is. Beats me.

…I did not think to change the wording on my website from the Garth Turner campaign to the Halton Liberal Association, so cheque-writers would face no delays or hassles in getting tax receipts. Whoops. Screw up. Enter Stephen Taylor and his “clean government” buddies to shoot my butt off.

So, what have I learned in the last twelve hours?

First, the website wording was changed. I learned not to ignore that. Second, I spent lots of time talking to a flinty-eyed party regulatory guy about campaign financing. I learned I do not want to be a regulatory guy. Third, I learned that even if the Lib riding association was dysfunctional, I had to turn over the meager amount of money in my indie campaign account. Fourth, I learned this will take some days, weeks maybe, to sort out since every donation of five or ten bucks, made over PayPay, by credit card, or cheque, will have to be reviewed. After all, the guardians of Clean Government are out to bury me &emdash; once they dig themselves out. I have learned there’s a big controversy raging about whether or not political candidates can even raise money online through portals like PayPal. It’s the Internet thing, you know, the devil’s invention.

And I’ve learned I am apparently not dead yet.

For that, Mr. Taylor, I thank you.

Comments

comments

  • Archie

    On Sept 23/2008 Garth Turner posted the following:

    “To win Halton will take about $90,000, and we remain far short of that goal. As you know, I was required to leave a large sum of money with the Conservatives when I left, and thus started off with a hand behind my back.

    I am asking you to help me free that hand, so I can fight fully to return to Parliament. You know why.

    If you can help at all – and twenty dollars is wonderful – then I would be grateful. Please consider it. To donate, go here. Thank you.

    posted by Garth Turner on 09.23.08 @ 10:49 pm”

    First all it seems that he has the attitude that the money left to the Halton CPC riding belong to him and secondly it's odd that right after this complaint is filed, Garth is begging for money. Isn't he the Liberal party fund raising guru. Maybe the liberals in Halton and all of Garth's loyal trolls on his blog are cheap like the rest of the liberals across Canada.

  • http://plattytalk.blogspot.com Platty

    You know Stephen, between you and Angry, you're going to make Garth go postal!! Actually, he's probably shaving his village people special right now and heading for the airport….

    =

  • bob

    It is amazing how Don Newman and the CBC keep giving Garth a pass. You'd think Garth was a Liberal or something ;)

  • Babylonian

    Platty wrote……

    “You know Stephen, between you and Angry, you're going to make Garth go postal!! Actually, he's probably shaving his village people special right now and heading for the airport….”

    LMAO! Sorry, that conjured up some hilarious mental images. I have a feeling Stephane Dion might shave his head and join some monks in Tibet.

  • simon

    Garth…Youve done again with what your basic nature always demands of you…a consession with a disclaimer tacked on the end with just a hint of moral indignation thrown in for good measure…cause I mean gosh Garth we all know you’re just a good ole Halton boy who’s tryin’ so hard to beat his way to the top of the heap despite all the slaggin’ yuh get from those thar nasties who would see ya squirmin’ under a truck.
    Garth me man…your condescension knows no bounds and because of this you my friend are running out of rope.
    So enjoy your drop into obscurity ’cause it truly looks good on you! …some would call it retribution;me,I would call it deserving.

  • simon

    Garth…Youve done again with what your basic nature always demands of you…a consession with a disclaimer tacked on the end with just a hint of moral indignation thrown in for good measure…cause I mean gosh Garth we all know you’re just a good ole Halton boy who’s tryin’ so hard to beat his way to the top of the heap despite all the slaggin’ yuh get from those thar nasties who would see ya squirmin’ under a truck.
    Garth me man…your condescension knows no bounds and because of this you my friend are running out of rope.
    So enjoy your drop into obscurity ’cause it truly looks good on you! …some would call it retribution;me,I would call it deserving.

  • anon

    Ditto for CTV. Garth was on Duffy Live tonight. Nothing mentioned. Garth is LIVE but its not mentioned. Go figure. Garth was in fine form tonight, chalks up Liberal poor showings in the polls to Canadians not paying much attention to the election just yet. Typical arrogance. Not able to accept that Canadians are, in fact, paying attention and THAT is why his party's in trouble.

  • John G

    Where did the “indie” money go? I know where it went Stephen. In Garth’s pocket. That s.o.b is not beyond anything.
    He’s a complete and total asshole in every way.

  • John G

    Where did the “indie” money go? I know where it went Stephen. In Garth’s pocket. That s.o.b is not beyond anything.
    He’s a complete and total asshole in every way.

  • Ron

    A wholly Liberal response based on the fact that the laws just don't apply to him and how dare some petty little individual assume they have the right to expect Garth Almighty to observe the law. He is running for and defending a party that tied up parliamentary committies for two years investigating every little blip in Conservative history and now he has the nerve to be upset that his possible breech of Election law is being brought up. People of Halton – Garth is entitled to his seat; he shouldn't be expected to observe laws and procedures the little people need to observe. Be sure to mark your ballots correctly now so Mr. Almighty can resume his place at the trough.

  • Yeah, its me.

    Wow, as if you didn’t need any more proof that Garth was an a$$hole SOB.

  • Yeah, its me.

    Wow, as if you didn’t need any more proof that Garth was an a$$hole SOB.

  • gar

    Garth Turner will do anything to keep his cushy job. Dion and the Liberals were dumb enough to take him on. He is not a team player. His ego is bigger than his body. If he is re-elected those who vote for him must be crazy.He will do nothing for your community but keep himself in the spotlight

  • http://streetadvisorconsulting.blogspot.com markalanwhittle

    And who can forget the fast one Garth pulled on CPAC, among other things. More amazing is Stephane dion not reining him in. Then again dion is having troubles of his own, his platform has more holes in it than the titanic and it now seems it's every man for himself. When you have a long time Liberal president saying their party needs to be decimated at the ballot box all must surely be lost. Seems to me Harpers steady hand at the tiller will win the day. Nobody seems to want the drastic changes dion and the liberals are proposing and are inclined to support the conservatives in order to weather the economic storms Canada is facing.

  • Bocanut

    Where's his campaign manager/official beggar Esther Shaye,the person he publically blamed for the CPAC fiasco?
    The Halton “People's Princess” has resorted to begging for 20 bucks on his blog.
    Pathetic.

  • East of Eden

    If, just once, Garth could admit to what he did, take responsibility, apologize…and then leave it at that without the qualifier or excuse, I could maybe work up a splinter of respect for him. But, he steadfastly refuses to ever take responsibility or to apologize without pointing a finger, qualifying his apology and actions, or making an excuse. He is the first to rail at another’s alleged “wrongdoing” but refuses to ever admit to his own. Behaviour very unbecoming of an MP.

  • East of Eden

    If, just once, Garth could admit to what he did, take responsibility, apologize…and then leave it at that without the qualifier or excuse, I could maybe work up a splinter of respect for him. But, he steadfastly refuses to ever take responsibility or to apologize without pointing a finger, qualifying his apology and actions, or making an excuse. He is the first to rail at another’s alleged “wrongdoing” but refuses to ever admit to his own. Behaviour very unbecoming of an MP.

  • Ted

    Clearly, some people, myself included, made a donation based on the fact that Garth was the candidate. The party didn't send out any refunds, so Garth has a legitimate beef that some of that money is there because he raised it.

    Frankly, all is not sweetness and light within the Halton EDA. Many have left the party, including just recently, Rick Malboeuf. That should tell you something, too.

  • PFW

    Stephen,
    Thanks for exposing Mr. Turner’s alleged mis-use of funds in trust. Turner has a habit of forgetting what he has blogged about. While he is noe comp[lainig about the Conservatives keeping about $30,000 dollars when he left he always fails to mention that this money was a rebate from Elections Canada. The Liberal Association of Halton would have received similar rebate, although a little as the rebate is determined by the number received. He never mentiond the approximately $470.00 that he adamantly refuse to pay back to the Halton Conservatives as a result of an overpayment on his loan to the Association. About a year ago, he bragged about spending, I believe the number mentioned was in the neighbour hood of $14,000, for election signs. I think, perhaps the money came from his funds in trust, because he constantly carps about the Liberal Association having no money.
    If Mr. Turner, with all his indignation, has used his trust money above the $1100.00 donation threshhold perhaps it is time that he give it up and fade into to the sunset.
    PFW

  • PFW

    Stephen,
    Thanks for exposing Mr. Turner’s alleged mis-use of funds in trust. Turner has a habit of forgetting what he has blogged about. While he is noe comp[lainig about the Conservatives keeping about $30,000 dollars when he left he always fails to mention that this money was a rebate from Elections Canada. The Liberal Association of Halton would have received similar rebate, although a little as the rebate is determined by the number received. He never mentiond the approximately $470.00 that he adamantly refuse to pay back to the Halton Conservatives as a result of an overpayment on his loan to the Association. About a year ago, he bragged about spending, I believe the number mentioned was in the neighbour hood of $14,000, for election signs. I think, perhaps the money came from his funds in trust, because he constantly carps about the Liberal Association having no money.
    If Mr. Turner, with all his indignation, has used his trust money above the $1100.00 donation threshhold perhaps it is time that he give it up and fade into to the sunset.
    PFW

  • Wilma

    BOO HOO Garth Turner, so sad he got caught and good on you Stephen for bring it to the attention of him and everyone else. Garth Turner should grow up, he always comes across as someone being pick on when he does this to himself. Anyone who finds him trust worthy must have the rosiest of glasses ever made.

  • Liz J

    Have to say your not doing bad for a “blogette” as opposed to a really big blog like Garth's.
    You'll have to stop picking on the Big Guy!

    There's not much being said about Garth anywhere, no more appearances with his great buddy and new best friend, Dion either. That could be an ominous sign that it's already over for the Big Ego and no one is bothering to come to his aid. The way he slags Harper and the Conservatives the media would have him on daily but it would make them look more stupidly biased than they already are.

    The people of Halton are the only people who have the opportunity to deal with him, he's in or he's out, it's out of our hands.

  • http://www.tvloanmodificationleads.com Loan Modification leads

    Some people, made a donation based on the fact that Garth was the candidate. His alliance didn't give money so Garth is suffering..