Wilma’s Transition Society of Chilliwack filed a notice of civil claim on May 2 in B.C. Supreme Court against two former employees for misappropriating at least $1.4 million.
The defendants, Kathleen Mosa, the former executive director of Wilma’s Transition Society, and her daughter Erin Mosa, a former “homelessness prevention and support worker” were terminated by the society on April 9, for “just cause” due to unauthorized transactions, the notice of civil claim states.
The pair had been in the society’s employ since 2009. Wilma’s Transition Society provides transition house, second stage housing and other supports to women and children fleeing interpersonal violence.
It was a complaint received by the society in August 2023 that led to the process of filing a civil claim in court against the former employees.
The complainant alleged that Kathleen and Erin had misappropriated funds, which led to further investigation and discovery by society officials. They found that the pair had, since at least April 2020: “fraudulently, wrongfully, and secretly, either individually or in concert” charged personal purchases to the society’s credit card and bank accounts, the claim states.
The wrongful charges and transactions, unrelated to the society’s business, included cash withdrawals, personal cheques, e-transfers, as well as purchases of: groceries, gas, dining, furniture, clothing, electronics, gift cards, airfare, hotels, beauty products, alcohol, casino, and more. There were also purchases from stores such as Bootlegger, Old Navy, Smash + Tess, SportChek, Best Buy, and Apple.
The claim states Wilma’s Transition Society is bringing action against their ex-employees for: “misappropriation, conversion, conspiracy, fraud, breach of contract, unjust enrichment, negligence, gross negligence and breaches of fiduciary obligations.”
As the executive director since 2012, Kathleen Mosa was a “key employee” privy to the financial details, and “afforded discretion and autonomy” to act in ways that could hurt the society, “such that the society was vulnerable to Kathleen in her exercise of that discretion,” the claim noted.
The unauthorized transactions were either for Kathleen’s or Erin’s “personal benefit,” it alleged, or for that of their immediate family, and were not justified as business expenses.
“The unauthorized transactions did not relate to any legitimate purpose pertaining to the society’s business or affairs, did not further the society’s mandate, were not justified business expenditures and were not in the best interests of the society,” the claim continued.
There has been no evidence of any repayment by the defendants for any of the transactions.
“The extent of Kathleen and Erin’s misappropriation is not known. Since April 1, 2020, the society estimates that the unauthorized transactions total $1,397,704.”
Since most of the society’s funding comes from government sources through funding agreements, and the wrongful actions of the two former employees “have caused the society to violate their contribution agreements” and “significantly” impacted the organization’s future and financial viability, the claim states.
“As a result of unauthorized transactions Kathleen or Erin, or either one of them have been unjustly enriched to the corresponding deprivation of the society,” it continued, adding there’s “no juristic reason entitling Kathleen or Erin to that enrichment.”
Under “relief sought” the claimants are seeking against the defendants, jointly and severally, damages in an amount to be proven at trial “equal to the total amount” of the $1.4 million in unauthorized transactions. They seek damages for breach of trust, breach of fiduciary duty, negligence and more.
The society is also claiming the right to any property from the proceeds of the transactions, the right to trace all proceeds to their assets. In addition to a preservation order to preserve the value of their assets, they’re seeking that the pair make restitution to the society, and disgorge any benefits.
The actions of the two ex-employees are described in the claim as “malicious, high-handed, callous and reprehensible,” which entitles the society to punitive damages, it argues, and the audit and legal expenses were cited under the “special damages” section.
READ MORE: Kelowna woman on trial for $1.8M of fraud, theft
The defendants have 21 days to file a response to the civil claim.
