ArriveCan App Contractors Caught in Indigenous Business Sham

The ArriveCan app scandal is the gift that keeps on giving, and now we are learning more about just how Canadian taxpayers were duped into paying over $60 million for the project (and possibly more).

Two companies that won federal contracts under the Indigenous business program have failed government audits, raising serious questions about how Ottawa awarded millions in taxpayer dollars for the troubled ArriveCan app.

Coradix Technology Consulting Ltd. and Dalian Enterprises—which jointly secured dozens of contracts through a program meant to benefit Indigenous businesses—were found not to meet key Indigenous ownership and control requirements, according to an audit obtained by The Globe and Mail.

The findings cast doubt on how Ottawa manages over $1.6 billion in Indigenous-set-aside contracts annually. Critics, including the Assembly of First Nations and former auditors, have warned for years that non-Indigenous firms use shell companies to exploit the system.

An Indigenous Services Canada spokesperson told the Globe the joint-venture “did not meet the ownership and control, as well as the Indigenous content criteria.” Oh, but they still got paid from lucrative contracts, right?

Look at the annual payments paid to Coradix and Dalian from the federal government since 2003:

Dalian, a small Indigenous-owned company with two full-time employees, partnered with Coradix, a much larger non-Indigenous firm, to win federal contracts. They claimed their joint venture met the requirement that at least one-third of the work be done by Indigenous workers or subcontractors—a claim the audit now disputes. Uh-oh.

Despite these findings, the federal government has not announced whether it will take action. Officials say the suspension of both companies from future contracts will remain in place, but details on consequences remain vague. This is Canada of course, where anything goes.

Coradix is now suing the government for $64 million, claiming its suspension was politically motivated amid growing scrutiny over ArriveCan’s ballooning $60-million cost. Dalian founder David Yeo slammed the audit’s timing, calling it a smear campaign. Nothing screams innocence like launching a lawsuit against the feds.

The scandal further undermines public trust in how Ottawa hands out lucrative contracts, with calls growing for a full external review of the program.

The pandemic-era ArriveCan app’s final cost will likely never be known, as the paper trail for the project remains incomplete, according to auditor general’s report last year. It seems like Canada may need a full audit of all government departments because this just looks like wasteful spending and exploitation of taxpayer dollars.