TORONTO -- WE Charity is selling off its assets, eliminating staff and winding down operations in Canada months after becoming embroiled in a political scandal that has triggered investigations by the federal ethics watchdog.
The charity announced Wednesday that, due to financial pressure and loss of sponsors, it plans to sell off tens of millions of dollars’ worth of assets, including real estate in Toronto, in hopes of keeping its international humanitarian programs afloat.
Co-founder Craig Kielburger, who started the charity when he was 12 years old, said he’s devastated by the decision and admitted he never expected the political firestorm after WE Charity accepted a now-cancelled deal to deliver a student grants program for the Liberal government.
The contract for up to $43.5 million faced intense scrutiny after it was revealed that the families of Prime Minister Justin Trudeau and former finance minister Bill Morneau both had ties to the charity.
“I wish that the certain politicians had recused themselves, but there's no one we blame,” Craig Kielburger told CTV News Chief Anchor and Senior Editor Lisa LaFlamme in an exclusive interview on Wednesday.
“This was a pandemic. It was a political process, it was a rush to get an initiative out the door. We were naive on the politics. I just wish in all the politics, people thought about what was being lost.”
He and his brother, co-founder Marc Kielburger, plan to leave the organization once the process of closing Canadian operations is complete.
“The simple math is now the charity is spending more than it’s bringing in,” he said.
Marc Kielburger confessed that he’s “angry at the situation” and he said he doesn’t think the charity would be ceasing its Canadian operations had it not taken up the government’s offer.
“But if you ask us if we had the opportunity to answer that phone call again, I would say yes, we would. As crazy as that is, during a pandemic when the opportunity to help 100,000 young people in this country, an opportunity to put up your hand, I'd do it all again,” he said.
In the coming months, the charity will sell its assets, including all of its real estate. Money from the multi-million dollar sell-off will go toward an endowment fund to pay for global projects such as WE Charity’s hospital, college and agricultural learning centre, as well as fund WE Villages projects in Latin America, Asia and Africa that have yet to be completed.
Marc Kielburger said he expects the fund will keep those initiatives going for “generations to come.”
The organization says that, moving forward, it won’t create any new schools or agricultural projects in any of the nine countries where it operates. In Canada, all of the charity’s staff will be let go, but its educational resources, including curriculum for teachers, will remain available online for free.
Without any Canadian staff, annual WE Day events will be cancelled permanently.
Marc Kielburger said the sell-off will also help pay off the charity’s existing debts.
“So much has been lost in this process, in this political quagmire and the politics and the pandemic, but at least something good can come of it, and that endowment is the opportunity for us to do something. And again, we can’t save everything, but this is what we do want to save, those projects, both at home and around the world,” he said.
Marc Kielburger also denied that accepting the government contract had anything to do with making money for the charity, which -- like many charities -- faced intense financial difficulties during the pandemic.
“There was no opportunity for profit,” he said.
Asked about any direct communications with Trudeau, Craig Kielburger denied any such contact and backed up Trudeau’s claim that it was bureaucrats who first brought up the proposal.
“We’ve never spoken to Justin Trudeau on the phone, ever. Don't have his email, don't know how to reach them,” he said.
After the Liberal government announced the deal with WE Charity in June to deliver the Canada Student Service Grant, ties to both Trudeau and Morneau’s families emerged.
Trudeau's mother, Margaret Trudeau, spoke at approximately 28 WE Charity events and was paid $250,000 in speaking honorariums between 2016 and 2020. The prime minister's brother, Alexandre Trudeau, also spoke at eight WE Charity events from 2017 to 2018 and was paid a total of approximately $32,000.
In addition, Trudeau's wife, Sophie Gregoire Trudeau, received a "one-time speaking honorarium" of $1,400 for participating in a youth event in 2012, before Trudeau became leader of the Liberal Party.
Meanwhile, WE Charity paid, in part, for two trips that members of Morneau's family took in 2017 — one of which Morneau himself took part in.
Morneau apologized for the "error" and said it was his full intention to cover the full cost of the trips — though it wasn’t until July that he repaid the $41,000 the charity had initially covered related to the trips to Kenya and Ecuador. The former finance minister's daughter Clare has also spoken at WE events, and his daughter Grace was employed by WE Charity until August.
Morneau has since resigned as both finance minister and as a member of Parliament, though he would not directly attribute the decision to the WE controversy.
Both Trudeau and Morneau have apologized for not recusing themselves from the discussions. Trudeau has insisted that he was not in an actual position of conflict during the conversations about the Canada Student Service Grant — but rather, that he was subject to a perception of conflict.
The prime minister has also said he expressed concern about the choice of WE Charity when he first learned of it. He said he was worried about a perception of conflict, and as a result asked the public service to "put the brakes on" to ensure the organization really was the only one that could have delivered the program.
WE Charity’s decision to wind down operations in Canada comes the same year as its 25th anniversary.
With files from CTVNews.ca's Rachel Gilmore in Ottawa
