Auditor general to investigate all government payments to ArriveCan contractor GC Strategies

Canada's auditor general will conduct a full audit of all government contracts awarded to GC Strategies, the company at the centre of the ArriveCan controversy.

In a letter sent to the House of Commons on Monday, Karen Hogan confirmed that her office will look at all government contracts awarded to GC Strategies, its predecessor Coredal and other companies incorporated by the two co-founders. She will also examine related subcontracts.

"We are in the process of gathering information that will allow us to properly scope and plan the audit," Hogan wrote in her letter to Speaker Greg Fergus.

The auditor general's letter camein response to a request from the House government operations committee, one of a number of parliamentarycommittees that have been scrutinizing GC Strategies in the wake of the ArriveCan project.

The app was launched during the pandemic as a communication and screening tool to ensure travellers arriving in Canada complied with pandemic border measures. It later became a way for travellers to show their vaccination status. It is stillbeing used as a way for travellers to fill out their customs forms before arriving at a point of entry.

Hogan reported in March that excessive reliance on contractors was a major factor contributing to ArriveCan's ballooning $59.5-million price tag though she noted that figure is only an estimate given the poor record-keeping on the project.

Hogan estimated that GC Strategies received $19.1 million for the project. But that figure only includes money paid to the company up to March of 2023.

Canada's comptroller general told the House public accounts committee in March that GC Strategies and Coredal have been awarded 118 contracts totalling $107 million since 2011.

WATCH | ArriveCan app was a hot mess: auditor general report:

ArriveCan app was a hot mess: auditor general report | About That

9 months ago

Duration 10:30

In a scathing new report, Canada's auditor general says the final cost of the ArriveCan app is 'impossible to determine' due to poor record-keeping by the Canada Border Services Agency. Andrew Chang breaks down the report's findings about this pandemic-era tool that is estimated to have cost Canadians nearly $60 million.

Hogan's ArriveCan report said there was little documentation to show why or how GC Strategies was chosen for the project.

The company is a two-person consulting firm that advertised itself as being able to help companies navigate the government's procurement process.

GC Strategies was given a sole-source contract in April 2020,despite a lack of evidence that the firm provided a proposal document for the project, Hogan's report says. Hogan noted that at least one other firm provided an initial proposal for the same contract.

Hogan also found that GC Strategies was involved in developing requirements that were later used for a competitive contract. That contract valued at $25 million was awarded to GC Strategies, the report says.

A separate report by Alexander Jeglic, Canada's procurement ombudsman, found that the criteria used in awarding the $25-million contract were "overly restrictive" and "heavily favoured" GC Strategies.

Kristian Firth, one of the company's partners, has pushed back againstsome of Hogan's findings during appearances at committee.

The RCMP has also been investigating GC Strategies and searched Firth's home office in April. Firth told MPs that the search wasn't related to ArriveCan and instead was related to allegations from Botler AI an IT firm that didn't work on ArriveCan but had been hired for a separate project through GC Strategies and other firms.

Botler co-founder Amir Morv told the government operations committee last year that his resume and that of his partner were altered without their consent or knowledge for a government task authorization.

Firth has testified at committee that his company changed the resumes before submitting them to the government. He said it was a mistake.

Morv also suggested that GC Strategies may have been "ghost contracting," which he described as a scheme that sees a company bill the government for work attributed to subcontractors that may not have done any work.

Firth and GC Strategies have denied these allegations.