An interim report on the governance review into Hockey Canada revealed that the national sports organization established a third fund of cash reserves to pay out uninsured claims, which was largely shielded from public view and accounting. The organization also resisted calls for financial transparency because it was worried its large cash surplus would hurt its bargaining position in settlements, such as those it has made in the past with sexual assault survivors.

Though the report, conducted by former justice of the Supreme Court of Canada, the Honourable Thomas Cromwell, is only a preliminary accounting of his findings (he expects to issue his full report by the end of October), the results are revelatory, according to one expert in charity oversight. And while the top-line findings that Cromwell investigated garnered news coverage, there are alarming details found deeper within the 103-page report.

“It’s pretty damning,” said Kate Bahen, managing director of Charity Intelligence Canada.

Drawing from dozens of interviews with Hockey Canada officials, financial statements, Board of Directors minutes and other primary source documents, Cromwell concluded that Hockey Canada’s possession of a National Equity Fund to pay out on uninsured claims, primarily fueled by player registration fees, is indeed shrewd risk management. However, the overall transparency regarding the fund and the way its use is communicated to members and participants is flawed.

But Cromwell’s interim report dives further into Hockey Canada’s use of reserve funds to uncover several other significant revelations, including:

Hockey Canada worried that being viewed as an organization with deep pockets would make it a target of claims, including those from sexual assault survivors, and would hurt its bargaining position in any settlement talks. Hockey Canada also stated that, should its financial statements be made readily available, that could adversely impact its position with sponsors and could lead to negative media portrayals.

Hockey Canada developed a third fund during the 2007-08 fiscal year that was originally designed to shield participants from rising insurance premiums. The Insurance Rate Stabilization Fund is now also used as a third reserve fund for uninsurable claims, which has largely been shielded from public view.

Cromwell found that Hockey Canada could not account for certain expenditures it professed to be making on account of the National Equity Fund and did not receive a clear explanation as to how that fund was managed and by whom.

In a letter announcing Hockey Canada’s action plan, released in July, the organization pledged “transparency and accountability in meeting our commitments.” The pledge came at a time when the organization was under siege from federal lawmakers and the greater public after it was revealed that Hockey Canada had reached an out-of-court settlement with a young woman in May 2022 who said she was sexually assaulted by eight junior hockey players at a Hockey Canada Foundation event in London, Ontario, in June 2018.

But in the governance review that began shortly thereafter, Hockey Canada spurned recommendations by the Canadian Olympic Committee’s NSO code, saying that some proposals, such as making financial statements and minutes of member meetings available to the public were not “well-suited for their organization.”