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Business owner tells disciplinary hearing he didn't authorize payments to former Alberta accountant

CPA Alberta is conducting a disciplinary hearing into alleged unprofessional conduct of Paul Sturt. (Madeleine Cummings/CBC - image credit)
CPA Alberta is conducting a disciplinary hearing into alleged unprofessional conduct of Paul Sturt. (Madeleine Cummings/CBC - image credit)

The former owner of a construction company in Spruce Grove says he did not authorize a series of payments and transfers to one of his employees.

The organization for chartered professional accountants in Alberta has been holding a disciplinary hearing into Paul Sturt's conduct this week.

The former chartered accountant is accused of receiving more than $6.5 million in unauthorized payments, funds and wire transfers while he was working for Thompson Brothers.

Larry Thompson, who owned the company at the time and said he worked closely with Sturt, told the hearing on Wednesday that he learned about the payments in July 2017.

He said an invoice on his desk after a vacation caught his attention and he started asking questions about it.

He then learned about other payments that, he said, "had nothing to do with the business."

Thompson said when he questioned accountants in the office who worked under Sturt about the payments, they said they thought he knew about them.

"I didn't know anything about this," he told the disciplinary hearing on Wednesday, speaking on Zoom from a loft in his home.

During the hearing, Julie Gagnon, a lawyer for CPA Alberta's complaints inquiry committee, showed Thompson copies of cheques, bank statements and transfer documents between 2010 and 2017.

Thompson told the hearing he had loaned money to Sturt twice before, but he did not authorize those payments.

One of them was a cheque with Thompson's signature for $1.15 million from the company's profit-sharing plan in 2010.

Thompson said he could not recall if Sturt had received a discretionary bonus that year but he did not authorize the cheque for an amount he said was unprecedented in the company's history.

Sturt's lawyer, Brian Beresh, said earlier in the hearing, which began in the fall, that Thompson knew about the bonus and signed a cheque for the amount.

Thompson told the hearing on Wednesday that he regularly signed blank cheques before going on vacation, at Sturt's suggestion.

Other payments were made by cheque from the company to Sturt's personal tax payments account with the Canada Revenue Agency.

Thompson said he and his father had sole signing authority for cheques coming from the company, but Sturt could co-sign with another person if the men were away from the office.

Thompson said after learning about the payments, he confronted Sturt, who apologized in a boardroom meeting and said he would pay back the money.

Sturt has told the hearing that he is not guilty of unprofessional conduct.

He is also facing fraud-related criminal charges. Beresh has told CBC News the charges will not be proven in court and Sturt denies wrongdoing in the case.

Thompson Brothers sued Sturt in 2018 but Larry Thompson told the CPA Alberta hearing that the court case has since been settled.