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Fraud & Speculation of Dominion and Indian Lands

 

John Cochrane first nation

Ferguson Royal Commission 1913 to 1915

Fraud & Speculation of Dominion Lands including Indian Lands

 

Chief John Dorion

May 26, 2009

 

 

 

A review of “The Alienation of Indian Reserve Lands during the Administration of Sir Wilfrid Laurier – 1896 to 1911; Tyler & Wright Research Consultants, May 1977.

 

Fraud and Speculation of Dominion Lands including Indian Lands

Ferguson Royal Commission - 1913 to 1915

The government of the day, on May 23, 1913, commission a Winnipeg lawyer, Mr. Thomas Ferguson, to conduct an investigation and report upon “all matters connected with the sale, lease, grant, exchange or disposition of dominion lands and of Indian land and Indian reserves.”

The investigations were conducted within a two year period from 1913 to 1915. Much of the investigation and subsequent discussions in newspaper coverage and the House of Commons debates focused upon matters in Manitoba, Saskatchewan and Alberta.

Mr. Ferguson examined several witnesses whose testimony exposed “improper transactions” by several government officials and employees involving schemes to secure lands parcelled out by the Government.

The evidence presented within the report indicated that government officials who were “guardians of Indian lands” and who were selling for the government became purchasers themselves.

The Ferguson investigation is only the “tip of the iceberg” but serves to illustrate the corruption, fraud, speculation and breaches of trust by governments in the handling of Indian lands.

Government Officials named in the Ferguson Report

Key top well known government officials were named in the Ferguson report and implicated in transitions involving corruption, speculation and fraud that ultimately allowed them to personally profit by using their government positions.

  • Mr. Frank Pedley – Deputy Superintendent General of Indian Affairs; (former Superintendent of Immigration)
  • Mr. James A. Smart – Deputy Minister of the Interior; (former Deputy Minister of the Interior and Indian Affairs departments)
  • Mr. J White – Inspector of United States Immigration Agencies
  • Mr. Frank Oliver – Minister of the Interior; (former Superintendent General of Indian Affairs)
  • Mr. George W. Brown – Lieutenant Governor of Saskatchewan
  • Mr. R. A. Cruise – Member of Parliament for Dauphin, MB
  • Mr. J.C Turriff – Member of Parliament for Eastern Assiniboia (former Commissioner of Dominion Lands)

Ferguson Reports tabled in the House of Commons – selected for this review

  • Moose Mountain Reserve, Saskatchewan: The acquisition of Indian lands through fraud and speculation by James Smart, Frank Pedley, and William White
  • The Riding Mountain Reserve: The acquisition of homestead lands through fraud by government officials  endorsed by Frank Oliver - the example of Mr. Cruise
  • Craven Dam: The acquisition of expropriated lands for profit by Mr. Brown through Mr. Turriff per request of Mr. Scott
  • Southern Alberta: The acquisition of grazing ranch lands through Mr. Turriff, his brother-in-law named as beneficiary

Government officials resign half way through the investigations

An interim report was released October 12, 1913 which led to the resignation of several government officials most notably the Deputy Superintendent General of Indian Affairs.

Mr. Pedley’s resignation was immediately accepted by the Privy Council “without prejudice to any action which the Crown may be advised to take against him.” 

Mr. Pedley’s resignation made headlines across the country on October 13, 1913.

  • “Head of Indian Affairs Resigns Rich Ottawa Post – Mr. Pedley involved in some serious rake-ups in the connection of Indian lands in the West: Evidence showed that Mr. Pedley trafficked in grazing leases on Indian lands”
  • “Frank Pedley Has Resigned His Lucrative Ottawa Post - Report indicated that officials higher up in (his) services have been beneficiaries of the sale of certain Indian reserves which they had in charge and which they recommended to be made”

Pedley was subsequently employed in a non-government position by his political party as party organizer in Northern Ontario.

Other government officials said to have resigned as a result of the Ferguson inquiries were Mr. Smart (Deputy Minister of the Interior), and Mr. Davis, Forest ranger appointed by Oliver to oversee disposal of lands in Riding Mountain reserve. Suggestions are that these men were also employed by their party following their resignations.

Release of Ferguson’s final report sparks discussion across the country

When Ferguson’s final report was released several major newspapers across the country covered the findings, April 12, 1915.

  • “Public Domain Maladministration Under Hon. Frank Oliver Causing Revelation To Delay Prorogation – Charges against Robert Cruise, Member for Dauphin – he secured through fraud a homestead in the Riding Mountains”
  • “Coarsest Piece Of Land-Grabbing Villainy Every Pulled Off In Canada – Hundreds of quarter sections were given away illegally to (government officials)”
  • “Gov’t Officials Made A ‘Clean-Up’ – Three high officials trafficked in Indian land and obtained $84,000.00”
  • “Three Trafficked in Indian Lands – Profits made through blank tenders for land; parts of Indian reserves which were being thrown open for purchase”

The findings of the Ferguson Report led to numerous debates in the House of Commons

On the day the House of Commons was to discuss the findings of the Ferguson Report, Mr. Oliver moved “that the House do now adjourn”. Mr. Oliver complained that the report had only come to him in late March, and he did not have enough time to read them over. His motion to adjourn these discussions because it was late in the session was voted down.

The 14 volume final report was presented in the House of Commons April 14, 1915. The House had to sit in discussion of the report findings until after midnight.

In opening discussions of the Ferguson Report, Mr. Frank Oliver (ex-Minister of the Interior) had this to say regarding the evidence implicating government officials in the department (under the administration of the former Minister - Mr. Sifton).

“As far as I have been able to follow the report, there is no suggestion that three men in purchasing Indian land got an acre for them for less than its full value... the Indian got what was coming to him; the country is discharged of its obligation to the Indian in as much as he got all that was coming to him.”

The case of James Smart, Frank Pedley and W. J White acquired lands by tender while in positions that would naturally give them an advantage in tendering.

  • In 1901, the areas of land acquired in connection with Moose Mountain Reserves were just over 45,000 acres purchased for $54,850. The land was then sold in April 1903 for $112,000; a profit of $57,000.
  • These 3 men purchased over 60,000 acres of land in Ocean Man, Pheasant’s Rump, Chakastaypasin and Cumberland 100A Indian reserves.
  • Before the land deals were complete, Mr. Smart was promoted to Deputy Minister of the Interior and Mr. Pedley was promoted to Deputy Superintendent General of Indian Affairs.
  • These lands were held in trust by the Government of Canada and were disposed of at a personal profit of $84,335.

The fraud and speculation - How they “trafficked” in Indian lands:

  • Pedley, Smart and White formed a partnership for the purpose of acquiring and selling portions of certain Indian reserves which were offered for sale by the Government
  • They then formed a company for the purpose of handling their lands and advertized their services as “We have exceptional facilities for dealing with government lands and acting as parliamentary agents for the same”
  • The company hired a lawyer to act on their behalf in the submission of tenders. They used their positions to delay opening for tenders so they could have tenders put in on time
  • Pedley & Smart sent hundreds of blank tenders to their lawyer that had been filled in with fictitious names and the bid amounts, which they had most likely acquired from internal documents stating the value of these lands
  • The tender bids were then submitted by their lawyer in Toronto to the Department of the Interior in Ottawa. They then received and opened their own tenders and awarded the lands to themselves. Only a handful of tenders were unsuccessful
  • White placed the lands they had secured for sale with various real estate brokers and government officers or employees to sell or dispose of (many of whom had offices or places of business in the United States).
  • The three men received payment from all the people they sold the lands to except for $1,000

As one Member of Parliament stated, “What excellent guessers they were of the price at which they might get Indian lands! Dealing with the lands for which they were trustees ... they pocket the money.”

The case of Riding Mountain reserve where hundreds of government officials secured lands who were not squatters.

  • A government employee gave away new homesteads on fraudulent entries with the approval of the Minister of the Interior, Mr. Oliver, who was in charge of the homestead administration. Hundreds of quarter sections were given away illegally.

The “improper transactions” cited in the Ferguson Report were bluntly described by one Member of Parliament when he said:  “Hundreds of men who had no right to entries for claims are given lands by the authority of the Minister ... hundreds of acres, hundreds of quarter sections disposed of illegally, fraudulently and for political purposes.”

The background for the corruption and fraud - How they did it:

  • In 1906 the boundaries of the Riding Mountain reserve were re-examined and a new line was drawn which excluded some quarters of land and included other quarters of land
  • Mr. Oliver, then Minister of the Interior, and his officials was responsible for the disposal of the land outside the newly drawn boundaries and the compensation for the squatters who were living inside the newly drawn boundaries. Considerable time had passed since the boundaries had been redefined and there had been much movement onto the reserves
  • Mr. Oliver, when considering claims as to “priority of right of selection”, decided it was necessary that “a man should have actually resided or squatted upon the land while it was a reserve and if there were tangible, substantial improvements ... the owner had prior rights over somebody who had not improved”
  • This meant that anyone who had established a building was considered to have improved the land and had a right to claim; and those who had not set up a building did not have a right to claim and did not receive compensation

  • Mr. Oliver gave W.A. Davis, a government appointed forest ranger, uncontrolled authority to decide who could claim the lands now outside the new boundaries and who was eligible for compensation as a squatter

  • The land agent, Mr. Herchmer (where land transfer claims are processed) was instructed by the Minister to allow any claims coming in with Davis’s name on them to pass through without review
  • For the lands that were disposed of outside of the new boundaries Davis hired 2 other men, Albert McLeod and Sam Cohen (both employed by the government), to go around with blank orders for land claims. These orders were then handed to Mr. Davis for his signature for them to take to the land office 
  • Fraudulent entries were estimated as high as 80%
  • The land agent, becoming uncomfortable with the illegitimate transactions he was receiving, notified the Minister of the Interior
  • Eventually a government official, Mr. Leach of Regina, was sent out to investigate (on two separate occasions) 
  • On both occasions he briefly discussed these matters with Mr. Davis and reported back to the department that everything was “all right ... although the evidence must have been before him”

A case in point - How government officials made fraudulent claims

Mr. Robert Cruise, MP for Dauphin

Mr. Cruise who was absent from the House of Commons during these debates was accused of receiving settlements for lands as a squatter and acquiring a homestead by misrepresentation.

How Cruise received a fraudulent land settlement:

  • Mr. Cruise maintained he was a squatter on the southeast quarter of the Riding Mountain reserve, lands the government were throwing open for settlement and compensation
  • For this quarter of land he claimed to have “prior rights” and to have made “tangible improvements” to qualify as an existing homestead
  • What he reportedly did to make “tangible improvements”  was to have someone cut logs for 2 or 3 days, and put up four bare walls without a roof
  • In this way he was considered to have qualified and secured priority right to claim for which he was compensated in a settlement by the government
  • Cruise later admitted under oath he was not a squatter; evidence was presented that “he never lived on the land”

How Cruise acquired homestead lands he was not entitled to: 

  • Mr. Cruise applied for a second homestead and secured title to lands by using questionable means of proving up his rights to lands that were being disposed of in the Riding Mountain reserve
  • Through “right to prove up land by ranging cattle”, Mr. Cruise, to prove his patent on “a good quarter section” of land,  needed 20 head of cattle but only had 13 head
  • To obtain the required number of cattle, he gave a promissory note to his neighbour for an extra 7 head of cattle, giving him the 20 head he needed
  • Once patent was secured on the quarter section, Mr. Cruise then gave back the 7 head of cattle he “purchased” from his neighbour to meet the maximum 20 head criteria and took back his promissory note
  • The use of cattle for the purpose of proving up the right to homestead was abolished in 1908

Member of Parliament comments: “Hon, Frank Oliver charged with the responsibility of protecting the interests of settlers in the great west, permitted hundreds of homesteads ... to be fraudulently disposed of to political parasites.”

The case of Craven Dam – Mr. Turriff, MP for Assinoboia and Mr. Brown, Lieut - Governor, Saskatchewan

  • Mr. Turriff, ex-Dominion Lands Commissioner in the Department of the Interior, in responding to a request from Mr. Scott (Premier of Saskatchewan), allowed Mr. Brown (Lieut-Governor of Saskatchewan) to purchase parcels of land that were later expropriated by the government.

How Mr. Brown speculated and exploited for profits:

  • It was established that Mr. George Brown, Lieut-Governor of Saskatchewan applied for three parcels of 1000 acres of land adjacent to his ranch
  • He purchased 1000 acres of land at $1.00 per acre, and another 518 acres also for $1.00 per acre (claiming the land to be valueless)
  • The remaining balance of the land was represented by half-breed script
  • Mr. Walter Scott, premier of Saskatchewan, wrote to Mr. Turriff asking for this land on behalf of Mr. Brown, who then held the lands for him
  • Six years later when 1,200 acres of these lands were expropriated by the government (as part of lands needed to build the dam), Brown claimed the lands were now worth $100.00 per acre; the value was fixed by the courts at $25.00 per acre, netting Brown significant profits
  • It was said that Mr. Brown was a private citizen at the time of the land applications, and Lieut-Governor when the lands were expropriated
  • Mr. Ferguson’s finding were that these lands were sold to Mr. Brown without inspection by the Crown and were improperly held for him by Mr. Turriff at the request of Mr. Scott

In 1902-1903, Hundreds of thousands of acres of land belonging to the Qu’Appelle Long Lake, Saskatchewan Railway and Colonisation Company were sold at $1.10 per acre.

Member of Parliament comments: “It was a deliberate attempt to filch from the settlers ... and hold it until they could turn a profit, as speculators and exploiter ... if the poor untutored Indian happen to have a few acres of land, he was not free from the avarice and the greed of these Shylocks of our land”

 

The of leasing of grazing lands near Bow River – Southern Alberta

  • A tract of grazing lands were granted yet no application was made - 28,000 acres granted that was not made available for bid.
  • A false entry was made by Mr. Turriff (Commissioner for Dominion Lands) for an additional 28,000 acres of grazing land for which his brother-in-law was beneficiary.

What happened?

  • An  application for 32,000 acres of land was sent to Mr. Turriff by a man (Mr. P. Brown) from Great Falls, Montana, however, the actual applicant was a Mr. McGregor of Brandon and the beneficiary was Mr. Adamson - ex-MP and brother-in-law of Mr. Turriff
  • While only 32,000 acres were applied for, 60,000 acres were granted by the department
  • A recommendation was placed on file increasing the amount to 60,000 acres
  • Mr. Turriff apparently voluntarily increase the amount of land granted although it was not requested in the original application
  • Mr. Adamson had concealed his connection with the application from the Department of the Interior
  • Mr. Turriff, when questioned at the inquiry, stated: “I do not remember anything about it”

Member of Parliament comments: “There is only one explanation the people of Canada can gain from it ... the anxiety to assist a brother-in-law brought about the change ... to satisfy the avarice and greed .. 60,000 acres of the best land in that province was alienated...”

The findings powerful ... yet forgotten

The debates within the House of Commons of the findings of the Ferguson Report were lengthy and somewhat heated.

Oliver was persistent in his accusations toward the Ferguson Royal Commission stating on several occasions that the purpose of the report was to black-mail specific members of the party.

“The power is invested in the hands of the government for the purpose of protecting the public interest and not for the purpose of carrying on partisan warfare by methods that are generally relegated to porch-climbers or thugs...”

The Toronto Daily News reported (April 15, 1915) that “the exposure made last night came as a direct shock to the members of parliament.” The Winnipeg Telegram referred to the debate as “the battle in the House of Commons” and many other reporters called it “sad day” for government.

No criminal charges were officially laid at the time the findings were presented, although strong accusations of fraud were made by certain members in the House of Commons. However, evidence from the Ferguson Report was sent to the Justice Department for further examination.

The findings of the Thomas Roberts Ferguson Royal Commission were considered to be blatant and gross evidences of fraud and violation of the trust of the Canadian people.

On April 16, 1915 the Ottawa Evening Citizen reported:

“Now the report (or part of a report) dealing with the political despoiling of Canada’s natural resources has been given to the public it should not be allowed to lapse into oblivion without definite action on the part of the government.”

However, the attention of the government and the public were quickly diverted by a major world war, and the findings of the commissioned inquiry of Mr. Ferguson faded into the background of the country’s business.

In February of 1916, a fire destroyed the House of Parliament and the Ferguson report containing the evidence that would expose the corruption, speculation, fraud and breaches of treaties that was designed to deprive Aboriginal people of their land.

 

 

 

 

 

 

 

 

 

 

Document Reviewed

 

“The Alienation of Indian Reserve Lands during the Administration of Sir Wilfrid Laurier, 1896 -1911”; Tyler & Wright Research Consultants, May 1977.

List of specific sources for the information referenced in this review:

  • A brief history of the Royal Commission of Thomas Roberts Ferguson with particular reference to his investigation into the Administration of Indian lands (pages 1-6).
  • Appendix D, D-1 to D-14: Record from the Department of the Interior concerning the appointment of Thomas Roberts Ferguson as Commissioner to investigate and report upon all matters connected with the sale of Dominion lands and other lands since the first day of July, 1896.
  • Appendix G, G1: Newspaper article speculation on the contents of an Interim Report presented by Thomas Roberts Ferguson, Royal Commissioner
  • Appendix L, L-1 to L-12: Newspaper coverage of the resignation of Mr. Frank Pedley, Deputy Superintendent General of Indian Affairs.
  • Appendix X, X-1 to X-13: Newspaper coverage of the findings of Thomas Roberts Ferguson, Royal Commissioner, April 12, 1915.
  • Appendix AA, AA-1: Extract from the Journals of the House of Commons related to the debate on the findings of Mr. Thomas Roberts Ferguson, Royal Commissioner. (Journal of the House of Commons, Canada, volume L1, 1915, 14 April, Page 375).
  • Appendix BB, BB-1 to BB-117: Extract from the debate of the House of Commons, Fifth Session, Twelfth Parliament, 14 April, 1915. Pages 2539-2601.Debate on the findings of Thomas Roberts Ferguson, Royal Commissioner.
  • Appendix DD, DD-1 to DD-41: Newspaper coverage of the debate in the House of Commons pertaining to the findings of Thomas Roberts Ferguson, Royal Commissioner.
  • Appendix FF, FF-1 to FF-17: Newspaper reports pertaining to matters arising from the presentation of the findings of Thomas Roberts Ferguson, Royal Commissioner, April 16 to 24, 1915.

 

 

 

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