Yukon business gifted $24,000 cash and "incubator space"
WHITEHORSE - It's not what you know, it's who you know, in the Yukon
La Petite Maison café in Whitehorse, Yukon. Two of the team members behind the business are Yukon Liberal Party members Edwine Veniat (right) and Gina Nagano (middle). Both are implicated in a Yukon government scam along with fellow party member Lana Selbee (inset). Images: Yukonstruct/Facebook.
A Yukon government scam channeled over $24,000 in unannounced public funding to a Whitehorse business owned by Yukon Liberal Party members.
The government also allowed the business in question to secure a long-term tenancy in a publicly-funded commercial space that was intended to be an "incubation" space used for a maximum of one year by any one business.
A person claiming to be a former Yukon government employee brought allegations of the scam to the Whitewash News in February of this year.
Since then, the Whitewash News has been extensively fact-checking the allegations, partly through a series of requests for information made to the government’s Access to Information and Protection of Privacy (ATIPP) office.
What is the scam?
The scam revolves around a deal struck between the Yukon Department of Economic Development and one of the territory's biggest commercial landlords Yukonstruct.
Yukonstruct rents out commercial space in the publicly-funded 20,400 sq. foot Northlight Innovation building in downtown Whitehorse.
The landlord is closely-aligned with the Yukon Liberals and uses its event spaces and social media platforms to promote that party.
In August 2021, as part of the deal, the Yukon government and Yukonstruct told the public that they were launching an incubation hub in Northlight Innovation for "food start-ups."
The incubation hub in question was the vacant commercial kitchen and seating area inside the building's reception area.
The government, on paper, agreed to finance the incubation hub with public money on the strict condition that it would be used by "as many food start-ups as possible to test and launch their concept."
In order to be eligible to use the incubation space, applicants would have to, firstly, be start-up entrepreneurs, and secondly, agree to vacate the space after a maximum of 12 months to give a new business the same chance to launch itself.
In a blog post on August 3, 2021, Yukonstruct announced the launch of a publicly-funded "launching space and testing kitchen" for food-based businesses to use for a maximum of one year (Image: Yukonstruct)
Not what you know, who you know
Instead of sticking to the terms of the deal and supporting "start-up entrepreneurs" in the Yukon, the government and Yukonstruct gifted the space to a business owned by members of the Yukon Liberal Party (YLP), one of whom has a string of business ventures already.
On August 3, 2021, Yukonstruct announced on its website and social media channels that the first business to be chosen to use the incubation hub was La Petite Maison, a café that would sell sweet and savoury pancakes or "crêpes."
La Petite Maison has three business partners behind it: Émilie Morin, Edwine Veniat and Gina Nagano.
Veniat is a member of the YLP as well as a former executive assistant to Education Minister and Liberal MLA Jeanie McLean, whose 2021 election campaign she also worked on.
Nagano is a high-profile member of the YLP who led McLean's 2016 and 2021 election campaigns.
Far from being a "start-up entrepreneur," Nagano is a long-established businesswoman who has received vast amounts of taxpayer dollars in grants and contracts for her business ventures from the federal and territorial Liberal governments.
In March 2022, one of Nagano's businesses House of Wolf was awarded the Arctic Inspiration Prize and $500,000 (which came from charity donations) after being nominated by Liberal MLA and then Yukon premier Sandy Silver.
On her House of Wolf website, Nagano lists McLean along with another Liberal MLA Tracy-Anne McPhee as "speakers" for her business.
Nagano, Veniat and McLean are also close friends of Yukonstruct's former executive director Lana Selbee. A fellow member of the YLP, Selbee previously served as a cabinet advisor to Liberal MLAs and also worked on McLean's 2016 election campaign.
Selbee is also listed as a team member on the House of Wolf website and played a crucial role in ensuring Nagano's business La Petite Maison got access to the incubation space along with financial supports.
L to R clockwise: Yukon Liberal Party members Lana Selbee and Gina Nagano celebrating their friendship; Liberal MLA Jeanie McLean using her political platform to promote Nagano's coffee business; and Yukon Liberal Party member Edwine Veniat, a partner in La Petite Maison in a Yukon government promotional video. (Images: Facebook / Yukonstruct / Government of Yukon)
Longest 12 months ever
A major stipulation in the incubation hub deal was that no food start-up could use the space for more than 12 months.
The stipulation included an agreement that Yukonstruct would run an application process for use of the space "annually" to ensure equal opportunity and fair competition for Yukoners.
As part of the ongoing scam, this stipulation is being completely ignored - as if it never existed - not just by La Petite Maison, but also by Yukonstruct and the Government of Yukon.
On August 11, 2022, without any explanation or reference to their 12 months being up, La Petite Maison and Yukonstruct announced that the café would be celebrating its "one year anniversary" in the incubation hub.
In their social media posts, La Petite Maison said they were "looking forward to our future successes" while Yukonstruct wrote "cheers to another year!"
There was no mention whatsoever of the fact that La Petite Maison had failed to vacate the space after the 12-month deadline to make way for a new food start-up business.
Nor was there any mention of the fact that Yukonstruct failed to run an application process to find a new start-up for the space, before the 12 months was up.
Now with under 6 weeks to go until the end of La petite Maison's second 12-month term, and yet again, neither Yukonstruct nor the government have made any efforts to run an application process for new food businesses to take over the incubation space which, especially at this late stage, suggests they have no intention of doing so.
SLIDESHOW: In August 2022, instead of making room for another food start-up as promised to the taxpayer, Yukonstruct with government support brazenly announced its intention to allow La petite Maison to stay on in the incubation hub past the maximum 12-month term. (Images: Yukonstruct/La Petite Maison/Facebook)
Government complicity, misappropriation of funds
When the money was given to Yukonstruct initially to launch an "incubation hub," it came with a caveat that Yukonstruct would have to provide a report to the government at the end of the year showing that the money was used exactly as intended.
Along with other terms in the agreement, this caveat seems to have been completely ignored.
A general end-of-year report was provided to the government by Yukonstruct but it does not reflect the initial agreement that Yukonstruct made in exchange for the public funds.
Despite this, government employees in the Department of Economic Development and Department of Finance are apparently turning a blind eye to the misappropriation of public funds and appear to have raised no flags whatsoever.
The ATIPP office denied the Whitewash News access to any documents that were shared with Cabinet therefore it was not possible to determine whether or not the politicians responsible for the departments involved are aware of the scam.
Without the government's complicity, however, it would have been impossible for Yukonstruct and La Petite Maison to publicly broadcast the café's intention to stay on in the incubation hub beyond the maximum 12-month term.
Secret transfer of $24,618.45
In addition to systemic cronyism and blatant misappropriation of funds for the so-called "incubation hub," the Whitewash News also found in the ATIPP results a financial transaction showing the government effectively gifted La Petite Maison $24,618.45 in public money to set up and "outfit" their café with equipment.
The cash was first sent by online bank transfer from the government to Yukonstruct and then used to benefit La Petite Maison.
The transfer was arranged in response to a written request for cash made by Yukonstruct.
Yukonstruct in the request said that the money would be used to "support food-based businesses and entrepreneurs in meaningful and productive ways" and implied that it would benefit all of the different food-businesses using the incubation space each year.
Despite the fact that the government is obligated to publicly announce funding of this nature, the cash transfer was essentially buried and Yukonstruct did not record it in its March 2022 year-end Financial Statements (available to view on the Yukon Corporate Online Registry) in a way that made it transparent.
Yukonstruct's official bookkeeper, Tanya Van Valkenburg, is listed on Yukonstruct's website as a "team member."
This situation goes against the ethical requirement for bookkeepers engaged by publicly-funded bodies to work at arms length from those bodies in order to avoid perceived or real conflicts of interest.
Yukonstruct's close personal relationship with Valkenburg would make it easier for the commercial landlord to mask the $24,618.45 in a way that nobody would ask questions.
The unannounced cash transfer of $24,618.45 given to Yukonstruct in 2021 to help La Petite Maison get set-up is not detailed anywhere in Yukonstruct's Financial Statements for the year in which the cash was received. (Image: Yukon Corporate Affairs)
Unfair competition
The Yukon government is not supposed to interfere unfairly in marketplace competition and yet it is clearly doing so to the benefit of La Petite Maison.
Allowing La Petite Maison to stay in the incubation space beyond the 12-month limit and gifting them $24,618.45 to set themselves up is completely unfair to other Yukon entrepreneurs and small businesses that struggle to find commercial space and are forced to take out loans and lines of credit to get up and running.
Yukonstruct, for its part, boasts loudly and often about how it supports all entrepreneurs, innovators and businesses equally.
Meanwhile it is directly involved in a scam with the government to boost a politically-aligned business and close off the incubation hub to new applicants that could compete with that business.
In addition to the anti-competitive shenanigans and financial support given to La Petite Maison, Yukonstruct has also been channeling catering contracts worth tens of thousands of dollars a year to the café, including big contracts like the annual Yukon Innovation Week.
Real reason for court action?
In 2019, Yukonstruct went to court to try to evict a former tenant from the commercial space in Northlight Innovation now known as the 'incubation hub' occupied by La Petite Maison.
At the time the space was categorised as a standard "blank" commercial café space where tenants would have to purchase and install their own equipment.
The former tenant The Poor Creature was owned by Brioni Connolly who always maintained that Selbee and Yukonstruct were telling lies and making up reasons to evict her.
These claims by Connolly now appear to ring true and not just because Selbee's friends ended up taking over her former café space.
Émilie Morin, one of the partners behind La Petite Maison, told What's Up Yukon magazine during an interview in November 2021 that she always wanted to open a food business and scoped out the space they now occupy sometime in 2019.
Morin said she "saw potential" in the space as a place to set up La Petite Maison and "even took a picture of it."
In an apparent Freudian slip, Morin added unnecessarily that the cafe space was "vacant at the time" she was scoping it out.
The café space was not vacant at the time Morin says she visited or at any other time in 2019. It was occupied by The Poor Creature that whole year.
Morin's slip-up with the "vacant at the time" comment suggests she was aware during her interview of the need to avoid saying anything that would expose the real reason Yukonstruct wanted to evict The Poor Creature.
A business partner in La Petite Maison cafe Émilie Morin (left) let it slip to the Whats Up Yukon magazine in November 2021 that La Petite Maison had been looking at taking over the café space in Northlight Innovation while it was still occupied by a tenant who wasn't planning on leaving (Image: La Petite Maison/Facebook)
Murky board dealings
Although current and past Yukonstruct board members must have been aware of the incubation hub shenanigans, the extent of individual board member complicity in the scam is difficult to determine.
There are several documents in the ATIPP records, however, that somewhat implicate the current president of Yukonstruct's board John Glynn-Morris, specifically in making way for La Petite Maison to take over the café space.
Glynn-Morris had been a board member of Yukonstruct before the court action against The Poor Creature was instigated by Yukonstruct in October 2019. According to the Department of Economic Development, he was involved in "supporting the Poor Creature and other tenants."
By the time the court action came around, however, Glynn-Morris was no longer on the board.
Despite this fact, the records show that Yukonstruct offered Glynn-Morris free legal representation, paid for by the taxpayer, and asked him to not share any information relevant to the court action.
The details are murky but it is obvious from the language in the records that Glynn-Morris had been identified by Yukonstruct as someone with key information who could seriously undermine the narrative Yukonstruct wanted to advance.
Glynn-Morris agreed to the deal and secured free representation from Yukonstruct's lawyer James Tucker.
If Glynn-Morris had been forthcoming with his knowledge of events at the time, Yukonstruct's court action would almost certainly have fallen apart, unless Yukonstruct was willing to turn on him also.
His silence appears to have paved the way for a messy court case and La Petite Maison's grimy entry into The Poor Creature's former space.
The current president of Yukonstruct's board John Glynn-Morris (left) had information that could have prevented Yukonstruct's eviction of its former tenant The Poor Creature but he stayed quiet after accepting free legal representation by Yukonstruct's lawyer James Tucker (right). (Images: Yukonstruct/Yukon law society)
Fact-checking
Amongst the records found by Whitewash News in the ATIPP results was a partially-redacted email thread dated August 2022 mentioning "legal options" under consideration by Yukonstruct to see if it could take action against the Whitewash News for "attacking" the organisation.
Yukonstruct, represented by its lawyer James Tucker (who is infamous for victim-blaming a teenage sexual harassment victim and calling her a liar), is known as an aggressively-litigious organisation with access to huge amounts of public funds to cover its legal costs.
It is one of the largest and wealthiest publicly-funded commercial landlords in the Yukon and it wields a monopoly-like power to make or break entrepreneurs and start-up businesses in the territory.
Even though it is not supposed to be political, Yukonstruct is also a huge promoter of the territorial and federal Liberal Parties and it has never sought to hide this fact.
The Whitewash News considers the exposing of corruption and wrongdoing at Yukonstruct, the Yukon government, or any publicly-funded body to be justified and in the interests of making the Yukon a more fair place for everyone.
Corruption and wrongdoing hurts people and tears at the fabric of our communities.
The Whitewash News in writing this story, as with all of our real news stories, carried out extensive fact-checking.
If readers are in any doubt as to the truth of this story, there are a few easy ways to fact-check:
1. The ATIPP Office provides government records for free and can be contacted for emails, financial documents, meeting notes, reports and other documents that will help verify our facts.
2. The acting deputy minister of Economic Development is Michael Prochazka. He signs off on funding approved by his department and can be contacted for more information on the incubation hub program. His department is legally obligated to be transparent about how exactly it uses public funds.
3. Yukonstruct's board of directors, like their government funders, are legally obligated to be transparent about how they use public funds. They can be contacted at info@yukonstruct.com or +1.867.457.0150 and questioned about the incubation hub program, La Petite Maison's tenancy, the $24,618.45 cash transfer, John Glynn-Morris's dealings with Yukonstruct's lawyer or any other facts outlined in this story.
If the government or Yukonstruct board ignore you or treat you like you’re dumb, perhaps by giving you the runaround, by delaying answers to simple questions or maybe giving you incomplete answers along with a "we can't comment," you’ll have a good sense of whether the facts in this story are true or not.
Correction: An earlier version of this story implied that the Arctic Inspiration Prize is funded by public funds. It is funded by charitable donations, not public funds.
Editors' note: This story was published in the 'Real News' section of our website. Facts are supported by the links provided within the story. If you have information or a tip regarding misconduct by politicians, government officials, or the organisations they fund, please consider sharing your story with us. We fully appreciate the risk of repercussions involved in speaking out and take very seriously your requests to remain anonymous.
