Investigation clears Kenora lawyer of fraud allegations

A Superior Court decision has cleared Kenora lawyer Douglas Keshen of allegations of fraud and misappropriation of funds from his clients’ Indian Residential School settlements.

Keshen cooperated with an investigation that began in 2014 after claims emerged from former clients that they had not received their full Indian Residential School Settlement Agreement (IRSSA) awards.

In its investigation, the Monitor interviewed Mr. Keshen and his staff and reviewed over 2,000 documents. It reviewed 168 fee reviews conducted by adjudicators in the claims process under the IRSSA.

The Monitor’s investigation revealed, “…that the clients had received their full awards and that Mr. Keshen had not received any personal benefit with respect to the loan advances he made or that third party lenders had made. Rather, Mr. Keshen lost money, several thousand dollars, because he simply forgave some of his loans to his clients,” read the court document.

In 14 files, Mr. Keshen had made interest-free advances to his clients, which loans were to be repaid from their IRSSA awards and that in 38 files, Mr. Keshen had assisted his clients in procuring third party loans — which the investigation found contrary to the Indian Residential Schools Settlement Agreement. Keshen maintains he was not aware of the breach.

“He at least attempted to dissuade his clients from borrowing from third party lenders, and he points out that third party litigation lenders are not a new phenomenon and there is the fact that his impoverished clients had immediate needs for the money and apparently the administration of the IRSSA was a slow payer,” reads Justice Perell’s reasoning for his decision.

For his breach of section 18.01 of the IRSSA and failure to prepare written reports that meticulously accounted for the client’s award and his fees, Justice Perell of the Superior Court ruled that Keshen should not be awarded his costs for the investigation.