ICU Statement on the Suspension of CEO Michael Scanlon

[Seanie]

Statement on behalf of the Directors of the Irish Canoe Union Ltd
To: all Affiliated Clubs and Discipline Committees
Date: 31 March 2011

1. Since the last AGM the Honorary Treasurer undertook a review of corporate governance and audit procedures having being authorised to do so by the Board of the Irish Canoe Union and in the course of this review he engaged in detailed discussion about current and past practice in relation to such matters with the Chief Executive.

2. The Honorary Treasurer informed the President and Honorary Secretary (both company directors of Irish Canoe Union Ltd) about matters of concern to him.

3. The Directors took legal advice on the information received from the Treasurer and were advised to set up an independent investigation and to suspend with pay and without prejudice the Chief Executive with immediate effect.

4. An Independent Investigation was undertaken into the matters of concern and the Chief Executive along with his legal advisor co-operated fully with the investigation.

The issues under investigation are that Michael Scanlon Chief Executive created and predated a document purporting to be a contract of employment for himself in November 2006. He confirmed that he predated the contract document to the 1st January 2005 and that both he and Brendan O’Connell (a former president until May 2005) had signed it. Included in the document created was a new salary arrangement implemented from the 1st January 2006 that aligned his salary to a public Sector pay scale. This had the effect of increasing his annual salary from around €56,000 to €65,000. In addition, other benefits including two pensions schemes one 100% funded by the ICU and another 98.65% funded by the ICU and VHI at Plan E was also fully funded by the ICU.

Michael Scanlon confirmed that he did this without the knowledge or consent of the President, the Executive Committee or the Board of the ICU.

5. The outcome of the Investigation, containing seven finding of fact was made known to the Board of the ICU and to the Chief Executive.

6. The Board unanimously agreed to continue the without prejudice and paid suspension of the Chief Executive pending the outcome of the meeting between a Sub-committee of the Board and the Chief Executive.

7. The Chief Executive declined to attend a meeting of the Boards Sub-committee and has instead sought an injunction before the High Court against the Irish Canoe Union Ltd.

8. In the above circumstances the ICU are defendants in the above mentioned high court proceedings and as defendants have no choice but appear in Court and defend the decisions and actions of the board to date.

9. Our ongoing legal advice is that, other than what is stated above and is currently a matter of public record, we cannot discuss or disclose any additional information relation to this issue until such time as the process established by the Board and or the High Court action initiated by the Chief Executive is complete.

10. You will be advised as soon as possible when an outcome has been established.

Signed By : Eamon Devoy - The President

Signed By: Karl Dunne - Honorary Secretary

Statement on behalf of the Directors of the Irish Canoe Union Ltd March 2011 Final.pdf

ICU Statement

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Having on multiple occasions requested and advocated better book keeping and auditing practices, constantly insisting that the the audited accounts didn't give a true and fair view, and in some cases were wholly wrong, I can say that I agree with the ICU's action. I hope the scope of their enquiries are widened in the future. It is and always was too easy to work out that that VHI plan E costs about €3,000 per year and the two pensions schemes cost tens of thousands of Euros. How did no one spot this, especially people on the executive board? This is unacceptable.

I wish that this action had come sooner. At a ICU AGM in 2008 I was shouted down by both delegates and elected board members when I pointed out errors in the audited accounts, errors that posed very serious questions as to how the accounts were audited and how figures were generated. Errors amounting to several thousand euros. I was shouted down by other delegates and the current chairperson. At one point Pat Mcalinney from River Deep interjected and asked the chairperson to treat me with the respect I deserved as a delegate. Neither the CEO or the Auditor (who was present) could explain the discrepancy to the AGM. Then there was a motion from the floor to adopt the accounts regardless of "the errors" and the AGM adopted the erroneous audited accounts happy that an explanation would be given in the future. I voted against this (one of the people voting for the adoption of the accounts told me to "Shag off back to Galway, theres no funny business here"). The AGM was adjourned, when it reconvened several weeks later, with a far smaller crowd, and with all the same old farts who adopted the accounts holding the majority of votes (it was actually delayed 45 minutes for them to arrive, using "quorum" as the reason for the delay). The resulting written explanation from the ICU was not sufficient.

That was only one matter I brought to their attention, there were more. AGM procedure and regulations were made up on the spot to suit individuals (an individual also mentioned in this statement). I also circulated the ICU accounts and recommendations widely, previous to this it was written into the ICU Memorandum & Articles of Association that only board members were allowed access to the audited accounts. A culture of secrecy was the norm, information was hard to get, this shouldn't be the way in a company and organisation like the ICU. However I circumvented this by using the freedom of information laws to request their accounts and other documents from the Irish Sports Council (they're also available from CRO, but more expensive).

The legal process is not over yet, but I think we can all agree the ICU is indeed in need of reform. Now that this information is in the public domain that process can start and IWW is a good place to start the conversation. Its worth noting that Noel Tallon, the newly elected ICU treasurer, spotted these issues and acted on them. There are a lot good people within the organisation at the moment, and the ICU has some great assets, lets not be hasty and let any reform be thoughtful and measured. I hope that open conversation and a productive, forward looking AGM can achieve this.

I'm available on Skype if anyone wants to get more details from me: seaniebyrne

All the best,
Seanie Byrne

PS. I told you so.




Some past forum posts and articles from IWW on the ICU.
Articles
My very first public post on the matter.
The State of the Union – the Irish Canoe Union 19/09/2008
My ICU Recommendations (PDF) - 19/09/2008
Part II: ICU Irish Sports Coucil Grant applications - 24/09/2008


Forum Posts
Reconvened ICU AGM - Saturday, November 8th 2008 City West - Apr 03, 2011
What the f*ck is going on with the ICU? - Feb 03, 2011
ICU in need of reform? - Feb 04, 2011
ICU constitution? - Mar 02, 2011
ICU AGM Notice - May 26, 2010
IWW KC motions and nominations - ICU AGM 2008
ICU AGM - Part 2 - Oct 22, 2008
Laptops missing following ICU AGM - Oct 20, 2008
Please attend the ICU AGM -Oct 17, 2008
ICU AGM & TDU AGM - Change of Venue - Oct 07, 2008
Discussion re: ICU recommendations - Sep 24, 2008

[canned]

Booooommmmm.....


Pretty big deal. Can't really understand why there's no discussion about this.

Point # 4 makes some pretty decisive statements, ones which I expect must be backed up in fact given an official statement is being circulated. I wonder what the implications are for those who are named in the statement other than the subject of the investigation itself.

Brendan O’Connell for example (I know nothing of this man's character), doesn't appear to be painted in an innocent light.

There seems to have been reactions to this as info came out (prior to the statement) to different people around the country which spurred calls for EGM. As I understand it, EGM notice has been served on the ICU and will happen.

Between this and the history of muddy water outlined in Seanie's post I think more than reform, we need transparency and accountability in the ICU.

[Seanie]

Pretty big deal. Can't really understand why there's no discussion about this.

Politically the ICU is a stagnant ditch. ICU AGM's in the past went off without one single motion. Think of it, nearly a million in turnover over, around 10% compound decrease in membership for years and no one turns up for an AGM let alone proposes any changes.

Why? Where were all the disgruntled member's?

Remember "ICU Bashing"? a negative term given to complaining about the ICU online. When I first expressed an interest in the ICU, my emails and calls went un-answered (over a period of months). The more contact I had with the ICU the more misgivings I had. After I received the accounts and started asking questions about them the ICU chairman finally called me, "to see what my deal was", he was combative and aggressive. I later learned that he referred to me as a "Crank" at a board meeting. And the current investigation met massive resistance from the old guard, allegations of personal vendettas were circulated and individuals characters were attacked.

Why? Go near the core of the ICU and it gets ugly pretty quickly. That's why.

"Sunlight is the best disinfectant" - Louis Brandeis

[neiltilley]

What are the implications of this for clubs? Or does anyone know?

Will the insurance which the ICU gives to clubs when they pay memebership be still valid if the ICU does end up in financial bother as a result of this court case?

[Seanie]

What are the implications of this for clubs? Or does anyone know?

As far as I know it will have no negative implications for clubs. In fairness to the current ICU executive committee and board, they have done a good job at keeping the show on the road. Yes the ICU has had to spend extra cash and resources on the legal issues, but they have been successful in securing the ISC grant and the ICU staff are continuing to offer courses and continue to facilitate members.

Will the insurance which the ICU gives to clubs when they pay memebership be still valid if the ICU does end up in financial bother as a result of this court case?

Again as far as I'm aware the ICU never offered clubs insurance. They offer individuals who were paid up card carrying ICU members Insurance for the term of their ICU membership. This insurance is renewed annually. And it can be paid for simply by taking a small amount from the cost of membership. More details about the policy can be found here. So again I wouldn't worry too much about it, I cant think of a reason why this would be effected.

[leftism]

Yes the ICU has had to spend extra cash and resources on the legal issues, but they have been successful in securing the ISC grant and the ICU staff are continuing to offer courses and continue to facilitate members.

Lets hope the ICU can win the current High Court case which Mick Scanlon has taken against them! As far as i know, that would significantly reduce the legal costs since Mick would have to pay for both parties legal fees.

My biggest concern at the moment is that clubs are calling for an EGM to vote off the executive, without the full comprehension of what the consequences of that could be... Letters are being circulated calling for an EGM, but the motives of those behind the letters are questionable at best. In most cases, the people calling for an EGM are avid supporters of those under investigation! Why would such people wish to call an EGM if not to scupper the disciplinary process which the ICU executive have undertaken...

If clubs and ICU members are as appalled as i am about the revelations of serious misconduct by ICU employees, let the executive conclude the process which they have begun and then call for a complete overhaul of how our sport is run. Otherwise we could see the same old faces reinstated to their jobs, due to a knee-jerk reaction by the ICU masses...

P.S- A huge thanks to Seanie and this forum for being the only online canoeing forum openly talking about the current scandal blighting our sport!

[annie]

I heard about this selective emailing of clubs to support a motion for a new executive. I assume some individuals would like to "scupper the disciplinary process" because they benefited directly or indirectly, (rightly or wrongly...) from how things were.

If there is an EGM I will go, to vote for the current exec to stay on and continue the process it is involved with. I recall the suspended CEO suggesting in 2008 that general meetings be moved out of Dublin every so often. He specified Limerick as a potential location - nonetheless I have a feeling I'll be travelling to Dublin, again. I hope something good comes out of this. We are all involved in the same sport and I don't think anyone ever took up kayaking for the money. It would be great if those who run it didn't forget that.

[Seanie]

If clubs and ICU members are as appalled as i am about the revelations of serious misconduct by ICU employees

Just a quick correction there. It was an Employee, singular. None of the other employees, past or present have any type of questions being raised about them. None. And I hope that they wont be dragged into this thing either.
Also its important to note that not just the employee that's open accusations either, members of the executive board (past and present) aren't looking like they can come away form this thing clean either.

My biggest concern at the moment is that clubs are calling for an EGM to vote off the executive, without the full comprehension of what the consequences of that could be... Letters are being circulated calling for an EGM, but the motives of those behind the letters are questionable at best. In most cases, the people calling for an EGM are avid supporters of those under investigation! Why would such people wish to call an EGM if not to scupper the disciplinary process which the ICU executive have undertaken...

I totally agree with this.

[leftism]

None of the other employees, past or present have any type of questions being raised about them. None.

Absolutely! Apologies if it sounded like i was suggesting that in my initial comments....

[canned]

Annie, I personally would like to subscribe to your newsletter and/or email list if you're going to suggest Limerick as a potential meeting location!

Leftism, I agree with you on the EGM - I was contacted as outgoing Captain of ULKC by a group who were attempting to call an EGM. There were a few things I didn't like about the idea, not least the fact that I felt that sending us on documents and saying little more than "print, sign and send" was not something that sat well with us.
I picked up the phone to discuss the situation and it took a while but the intention appeared to be to depose the current exec. In my opinion, this is flawed. Why go bulling into an EGM which is pretty much at AGM time anyway in order to do something that can be done at AGM with a lot less direct tension in the room?
In asking what final outcome was the target I don't think I got a clear answer.

But sure look, EGM notice (I'm told) has been served and the ICU (I believe) must respond to that demand.

I'll be honest though I'll expose my lack of information/naivety - In terms of what changes people need it seems to me that much would be solved by transparency and accountability (which would at least expose an "old boys club" which appears to be the mentality). Is there more to it (excuse my ignorance)?