Auditor general probing 4 Manitoba municipalities

The auditor general of Manitoba will probe four municipalities in an audit of their operations and accounts.

The decision by Tyson Shtykalofollows complaints concerning the rural municipalities of WestLake-Gladstone, St. Andrews, West St. Paul and Swan Valley West

Shtykalo will also examine municipal oversight at the department of municipal relations and how the department handles complaints regarding municipalities.

CBC Manitoba has been following this story since the Rural Municipality of WestLake-Gladstone reported in an Oct. 2020 news release it had lost money in a cyberattack over the 2019-2020 winter holiday season.

In December 2019, cybercriminals sent a phishing email to multiple people at the municipal office. One person clicked on the link, and that allowed hackers to get into the municipality's computers and bank accounts.

Court documents reveal that on Dec. 19, 2019 the hackers logged into the municipality's bank account and changed the password along with personal verification questions.

Withdrawals weren't discovered until Jan. 6, 2020 when the chief administrative officer of WestLake-Gladstone noticed a series of cash withdrawals from the municipality's bank account.

The money,totalling$472,377, had been sent to multiple bank accounts the municipality had never dealt with before. In total, 48 bank transfers with less than $10,000 each had gone to the unfamiliar accounts.

The municipality contacted the police as soon as they noticed the money was missing.

Cybersecurity experts say the scammers were likely not in Canada, but added that once money is out of Canadian banking institutions, it is difficult to trace because it is outside of the RCMP's jurisdiction.

The RCMP says there is no evidence that anyone within the community was involved in the attack.

The municipality's credit union, Stride Credit Union, and its insurance provider, Western Financial Group, refused to cover the loss.

The municipality filed a lawsuit in the Court of King's Bench against Stride in March2021 and Western Financial Group in December2021. Both lawsuits remain in the courts.

In the order-in-council document published on Sept. 6, 2022 the province's municipal relations department said they heard concerns from citizens in the WestLake-Gladstone municipality with "respect to council governance, financial management, oversight and public accountability."

The audit has now expanded to the three other municipalities.

Until these examinations are complete and the public report is released, Shtykalosays, he will not release further information, including details of the allegations.