CFS broke own bylaws in lawsuit against BC student union, UTSU VP says

Federation sued Selkirk College Students’ Union without approval of National Executive

CFS broke own bylaws in lawsuit against BC student union, UTSU VP says

The Canadian Federation of Students (CFS) National, the country’s largest association of students’ unions and a group of which the University of Toronto Students’ Union (UTSU) is a member, may have violated its own bylaws in pursuing litigation against one of its member student unions, according to UTSU Vice-President Internal Daman Singh.

On March 21, 2017, CFS National filed a civil suit against the Selkirk College Students’ Union and its Executive Director, Zachary Crispin, claiming that Selkirk failed to properly follow the process of holding a referendum on membership. This suit, however, was apparently not approved by the National Executive, the body representing both federal and provincial CFS leadership, prior to being filed, according to Jenelle Davies, British Columbia representative on the executive. This contravenes CFS Bylaw IV.2.1, which stipulates that the National Executive “shall have exclusive authority” to initiate legal action on behalf of the federation.

CFS Executive Director Toby Whitfield indicated the suit was discussed in camera at a National Executive meeting on March 23, two days after the claim was filed. Davies claimed she was unaware of this meeting.

If the National Executive had approved the claim, it would have been marked on record, which is not reflected in the minutes, said Davies.

Although the suit has been dropped by CFS National, the Selkirk College Students’ Union cannot administer a referendum without CFS cooperation.

Santanna Hernandez, chairperson of the union, said that Selkirk College students filed a second petition for a referendum on terminating membership with CFS National in November 2017, after they indicated that they would like to leave the CFS in a plebiscite. This petition has been verified by CFS National, but a referendum on the union’s membership has yet to be scheduled.

CFS National did not respond to The Varsity’s request for comment.

UTSU to hire students to help with You Decide campaign

Campaign aims to trigger referendum on Canadian Federation of Students

UTSU to hire students to help with You Decide campaign

The University of Toronto Students’ Union (UTSU) is hiring students to help with You Decide, a student-led campaign to hold a referendum on leaving the Canadian Federation of Students (CFS).

The position, titled Outreach Associate, will be responsible for “handling outreach strategies to make members aware of [You Decide], collecting signatures on physical petition sheets, and coordinating class visits in large lecture halls to speak to students.” There is not a set amount of Outreach Associates being hired, said UTSU President Mathias Memmel. “It’ll be based on the availability of those who are selected.”

The CFS is an organization that represents over 70 student unions across Canada, with the mandate of lobbying provincial and federal government on behalf of students. The federation and the UTSU have had a turbulent relationship for years, with current and previous UTSU executives endorsing leaving the federation, citing lack of accountability and opaque financials.

A referendum of the UTSU’s membership must be held in order to leave the CFS. In order to hold that referendum, a petition in favour of it must be signed by 20 per cent of students in the membership. You Decide is in the process of collecting those signatures.

Memmel said that the UTSU is hiring for this job because “You Decide has been endorsed by the UTSU, so it’s appropriate that we do what’s necessary to support the campaign. As we said last year, we’ll support any student-initiated effort to leave the CFS.”

UTSU Vice-President External and U of T’s CFS-Ontario (CFS–O) representative Anne Boucher echoed Memmel’s statements, saying that since the UTSU has already endorsed You Decide, it is going to do everything it can to help.

“It’s also nearly impossible to leave the CFS, so we’re going to do what we can to leave. It’s in students’ best interest to do so,” wrote Boucher. “Compared to the amount of money that CFS takes from students, the amount we’ll be spending to leave (i.e. by paying student collectors) is microscopic.”

In 2016, U of T student unions, including the UTSU, contributed $598,678 in membership fees to CFS–O, which amounted to about 38 per cent of the federation’s budget. The position of Outreach Associate will pay $14 per hour for a three-month term, with a minimum of five work hours per week.

On whether this new position would affect the UTSU’s relationship with the CFS, Memmel said he “couldn’t care less what the CFS thinks.”

“The CFS is just another nasty, self-serving corporation. It doesn’t do anything for U of T students, except for those on the CFS payroll,” said Memmel. “We’ve spent three years demonstrating that we don’t need the CFS, and we shouldn’t pretend otherwise.”

Boucher said that the two groups’ relationship is already strained, and that she’s experienced that strain in her own dealings with the federation.

“You’re immediately othered when you enter CFS spaces just for being from local 98 (UTSU), due to our efforts of keeping them accountable and presenting motions that would force them to be more transparent (eg take minutes, adopt online voting, etc),” she wrote.

The CFS and You Decide did not respond to The Varsity’s requests for comment.

“150 for Whom?” tackles anti-racism on Canada’s sesquicentennial

Panel features CFS Chairperson Coty Zachariah, former UTSU Executive Director Sandra Hudson

“150 for Whom?” tackles anti-racism on Canada’s sesquicentennial

Canada’s sesquicentennial anniversary, while widely celebrated, has also raised critical discussion regarding what it means to celebrate the past 150 years as seen through the lens of colonialism.

On November 11, the Centre for Integrative Anti-Racism Studies hosted a workshop and symposium event titled “150 for Whom, Canada? Colonialism and Indigeneity across Lands” at U of T’s Ontario Institute of Studies in Education.

The event included a panel discussion featuring Sandra Hudson, former University of Toronto Students’ Union (UTSU) Executive Director and co-founder of Black Lives Matter – Toronto; Coty Zachariah, current National Chairperson of the Canadian Federation of Students (CFS); George Elliott Clarke, former Poet Laureate of Toronto; Eve Haque, associate professor at York University; and Jennifer Mills, a postdoctoral researcher at York. The event was moderated by Alissa Trotz, an Associate Professor of Women and Gender Studies.

The discussion focused in large part on the ways that the panelists perceived Canada to have failed racialized and Indigenous communities, and how, as Hudson opined, Canadians should not be celebrating 150 years of conquest, violence, and settler colonialism.

“When I think about Canada 150, I’m thinking of 150 years of what?” she asked. “As a Black person, I don’t see myself reflected in anything about Canada 150 at all.”

The panelists also discussed the basis of Canada’s foundation, asking why Canadians are celebrating the past 150 years when the country’s history stretches far beyond that.

Zachariah, who is Afro-Indigenous, argued that the sesquicentennial celebrates the erasure of the history of Indigenous peoples who have been here much longer than European settlers. “When I think about 150 and 10,000, there’s just no comparison,” he said.

Clarke stated that it was also important to remember the original reason for Confederation, saying that “Canada is, in my opinion, the result of the British empire’s need to establish a bulwark against American manifest destiny, nothing more and nothing less than that.”

There was also discussion about the role of language in Canada’s history with Indigenous peoples.

Haque, who teaches in York’s Department of Languages, Literatures and Linguistics, spoke about the “importance of language” and how colonialism has destroyed parts of Indigenous culture.

“It is also through the imposition of colonial languages and the violent expunging of Indigenous languages and other languages that are here that colonialism is trying to break Indigenous relationship with land,” she said.

Zachariah echoed Haque’s point, saying, “They stole your language and your culture and they charge you $10,000 a year to get it back,” referring to the tuition some students might have to pay in order to learn Indigenous languages.

When asked by The Varsity how he plans to use his position as CFS National Chairperson to educate students on these issues, Zachariah said that it would be “by having this conversation, by being open to talking to places like The Varsity about what it means and what it could mean, and how we can form better relationships moving forward.” He said his role as chairperson can be to help foster those conversations.

He also said that he was “very open to working with any school,” including U of T, despite the UTSU’s current anti-CFS stance.

Hudson declined to comment.

CFS accused of unlawful conduct in missing motions from June National General Meeting

Federation did not add motions to agenda, calls claims defamatory

CFS accused of unlawful conduct in missing motions from June National General Meeting

The Varsity has obtained copies of four motions that were submitted but not added to the agenda at the Canadian Federation of Students (CFS) National General Meeting (NGM) last June. The motions in question, submitted by the the Vancouver Island University Students’ Union (VIUSU) and Douglas Students’ Union (DSU), alleged that the CFS breached their fiduciary duty and engaged in unlawful conduct.

According to Mathias Memmel, President of the University of Toronto Students’ Union (UTSU), the motions had been distributed to the member locals present prior to the NGM. Memmel confirmed that the Selkirk College Students’ Union received a letter from Gowling WLG, a law firm, explaining why their submitted motion was ruled out of order.

Memmel could not confirm if the VIUSU and DSU had received similar emails from the CFS. “In this case, it was more important that the information be made public. That’s what the movers set out to do, and they were successful,” Memmel said of the information provided in the motions.

Student union elections interference

The first motion, submitted by the VIUSU, alleges that the Canadian Federation of Students–Ontario (CFS-O) has been interfering in university and college student union elections “for well over a decade.”

This includes, but is not limited to, recruiting pro-CFS-O candidates and putting together slates composed entirely of pro-CFS candidates; producing campaign materials; and interfering in the hiring of returning officers while receiving confidential information from those officers, and in turn instructing them to induce fines on unfavourable slates.

The VIUSU alleges that the CFS-O interfered in student union elections for the UTSU, University of Toronto Mississauga Students’ Union, University of Toronto Graduate Students’ Union, and Association of Part-time Undergraduate Students, among others in Ontario.

York Federation of Students

The VIUSU’s second motion alleges that despite membership fee increases that have taken place since the 1996–1997 academic year, students belonging to the York Federation of Students (YFS) still pay only $2 per semester, whereas students from CFS member locals across Canada pay $4.43 per semester, over twice as much.

According to the motion, “The shortfall between what the YFS should have remitted in membership fees over the years and what it actually remitted now exceeds $1,000,000.”

The allegations follow that the CFS National Executive ensured other member locals were aware of the YFS’ failure to collect the correct membership fees “in the hopes of shaming the YFS into doing the right thing.” The motion goes on to claim that in the past three years, CFS leaders “reversed that effort.”

CFS Bylaw 1, Section 3.c. states that member locals are responsible for upholding the bylaws and for ensuring that the federation’s fee is collected at their institutions.

“We will be working with the YFS to resolve it. As for punitive action, no, it can and will be resolved through dialogue,” Peyton Veitch, National Treasurer of the CFS, said in an email to The Varsity.

Unpaid NGM fees

The DSU alleges that since 2015, Veitch and his predecessor Anna Dubinski have been “extremely lax” when collecting outstanding delegate fees for general meetings.

According to CFS Bylaw 1, Section 3.b.i., “Each member of the Federation will have one (1) vote at and participate in general meetings of the Federation provided all outstanding delegate fees for past meetings have been paid in full.”

The DSU alleges that, according to Jenelle Davies, the current BC Representative on the National Executive, there are “at least ten and as many as fifteen member locals” attending NGMs that have not paid outstanding delegate fees, making them ineligible to vote at meetings.

The motion goes on to state that as a candidate for re-election as CFS National Treasurer at the Fall 2016 NGM, Veitch “had an interest in ensuring that no member local that might be supporting him in the election was deemed ineligible to ‘vote at and participate in general meetings’ due to owing delegate fees for past general meeting.” According to the motion, Veitch did not inform the rest of the National Executive of this conflict of interest, violating his fiduciary duties as treasurer.

Veitch told The Varsity in response that his fiduciary duty “means acting in the Federation’s best interests.”

British Columbia Federation of Students

In its second motion, the DSU gives historical background to an agreement by the British Columbia Federation of Students (BCFS) and CFS National, where the BCFS agreed to allow the CFS to take over the administration of membership fees collected from CFS member locals in BC.

The motion alleges that, in response to the BCFS’ opposition to former CFS National Chairperson Bilan Arte’s candidacy for election, BC member locals were targeted “for retribution.”

During this “retribution,” the DSU alleges that the CFS stole BCFS fees; the amount stolen “likely in excess of $700,000.” In response to this, CFS National member locals from BC stopped paying fees of any sort to the CFS in an effort to force the stolen funds to be returned and for the guilty parties to be punished.

According to the VIUSU’s second motion, this is to protest the “flagrant disregard for the Bylaws and other democratic structures of the Federation.”

“The Federation provides a component allocation totalling 1/6 of the national membership fees collected in British Columbia. Upon receipt of the national membership fees being withheld since 2014, we will send them their provincial allocation,” Veitch said.

The motion alleges that former CFS National Treasurer Dubinski “unlawfully denied” BC Representative Davies access to the financial records of the CFS, a right afforded to “any member of the board of directors of a corporation falling under the Canada Not-for-profit Corporations Act.”

Davies told The Varsity that she has only been able to gain access to the CFS budgets, including “whatever is presented at National Executive meetings.”

“They said I would use the information to harm the Federation,” alleged Davies.

What is happening now?

According to Steven Beasley, Executive Director of the DSU, the motions, which were originally intended to be presented at the NGM, were presented to the entirety of the BCFS at the BC General Meeting. Members in BC resolved to present the motions to the CFS at the NGM in November on behalf of all of the BCFS.

Juhi Sohani, CFS National Communications Director, told The Varsity that there were some questions to which she could not provide answers. The Varsity asked to speak with CFS Chairperson Coty Zachariah, though Zachariah was unable to comment.

Retraction (Tuesday, October 31): On October 16, 2017, The Varsity reported allegations made by Vancouver Island University Students’ Union that the Canadian Federation of Students (“CFS”) and Toby Whitfield manipulated elections by means of a “slush fund”. No evidence was provided to The Varsity in support of those allegations.

The slush fund was subject to a forensic audit made by independent investigator Grant Thornton LLP. It found that the CFS management and CFS treasurers who took office after May 26, 2010, which include Mr. Whitfield, were not informed that the slush fund existed and did not authorize any transactions on that account. The audit found no direct or indirect implication of Mr. Whitfield in the creation or operation of the fund.

UTSU to stop printing International Student Identity Cards

Service provided through CFS deemed unnecessary

UTSU to stop printing International Student Identity Cards

On October 3, the University of Toronto Students’ Union (UTSU) Services Committee voted to stop printing International Student Identity Cards (ISICs) out of the UTSU office. ISICs are a form of student ID available in Canada through the Canadian Federation of Students (CFS).

The motion was moved by UTSU President Mathias Memmel, who argued that the service was an “inefficient use of labour hours given that students are able to do it online,” according to the meeting minutes.

UTSU Vice-President Internal Daman Singh wrote to The Varsity that “the infrastructure for making and printing ISIC cards was terribly outdated and would often be broken.”

“The process of printing a single ISIC card would take up a substantial amount of time for our front-line workers, and the labour costs of printing ISICs was simply not worth keeping the service,” Singh explained.

UTSU Vice-President External Anne Boucher echoed Singh’s statements, calling the CFS servers, required to print ISICs, “absolute garbage.”

“It just makes sense to get rid of something unreliable and inaccessible when a reliable and accessible version of it becomes available,” Boucher said.

In the meeting minutes, Memmel further stated that he found it “interesting” that the CFS would allow ISICs to be purchased online “given the CFS’s stance on the accessibility of online voting.” The UTSU has long criticized the CFS’ unwillingness to allow students to vote online in referenda on matters such as defederation.

“It’s nice to see the CFS is beginning to see the value in online platforms,” said Boucher. “I hope this will translate over to online voting — otherwise, it would be morally inconsistent on their part.”

ISICs provide students with “discounts in Canada and around the world and [demonstrate] you’re a full-time student (which is handy when people don’t recognize your student card),” according to the CFS’ website. The cards are available for free as a benefit of membership in the CFS.

In 2016, the UTSU released a report on the CFS that criticized the organization of overstating the value of ISICs.

The report stated that, in theory, the cards grant access to student discounts, but in reality do not provide a tangible benefit above standard student IDs. “There are few, if any, discounts available only to students who have ISICs,” according to the report.

An audit of a secret CFS bank account revealed that the account received payments titled “International Student Identity Card applicant.” The account has also been linked to a travel company that distributes the cards.

The CFS did not respond to The Varsity’s request for comment.

UTSU board meeting considers new bylaw, collective bargaining, vacant positions

Agenda for October 30 Annual General Meeting confirmed

UTSU board meeting considers new bylaw, collective bargaining, vacant positions

The UTSU held its monthly Board of Directors meeting on the afternoon of September 28. Topics on the agenda included the confirmation of the agenda for the Annual General Meeting (AGM), as well as the establishment of a shortlist committee to find a replacement Vice-President University Affairs.

VP University Affairs

Discussions about finding a replacement VP University Affairs, following the resignation of Carina Zhang in early September, have coincided with the UTSU moving forward with conversations that could lead to the dissolution of both the VP University Affairs and VP External roles and create a new VP Advocacy position.

UTSU President Mathias Memmel stressed that, while the reform talks coincide with finding a replacement for Zhang, the idea to combine the two positions into one was part of the platform of his Demand Better slate, which all of the executives save Zhang and VP External Anne Boucher ran with. Memmel said that the decision is a response to how each executive position’s responsibilities have changed over the years.

If the VP Advocacy position is created, it will be instituted in the next academic year. In the meantime, a committee has been formed to develop a shortlist of candidates to apply for the VP University Affairs position through an appointment process. Board members were selected to help with the decision, in line with a procedural structure that Memmel says has been used since the 2015–2016 academic year.

The union has also accepted the resignations of General Equity Director Ted Williamson and Faculty of Engineering Director Danja Papajani.

Bylaw XIX and the AGM

Notably, the board meeting touched on the addition of Bylaw XIX to the union, which will go before a vote at the AGM in late October. The proposed bylaw, in support of keeping the union autonomous, would prevent the UTSU from joining any group, or making any decision, where they would be unable to withdraw with a board vote. The Canadian Federation of Students (CFS), which UTSU Executives have been highly critical of, are one of these groups that can not be left with a simple board vote. According to Memmel, the bylaw is simply meant to ensure that “the UTSU’s autonomy isn’t taken lightly.” Memmel said that the UTSU is also not the first to take these precautions: he claimed the Dalhousie Student’s Union have done the same in their bylaws.

The meeting ended with a confirmation the agenda for the AGM to be held on October 30, 2017. Topics on the agenda include the presidential address as well as the review of the year’s audited financial statements. As for Memmel’s hopes for the meeting, he would like it to be “civil.”

New committee formed

Another committee formed at the meeting was the Collective Bargaining Oversight Committee, whose job it will be to assist the Management Committee. The newly created committee will have directors participating in “the collective bargaining process,” said Memmel, given that human resources are the UTSU’s largest expense.

CUPE Local 1281, which represents UTSU staff, will enter collective bargaining with the UTSU this academic year; their collective agreement expires in January.

Editor’s Note (October 3): A previous version of this article incorrectly stated that a by-election will be held to fill the currently vacant VP University Affairs seat. The seat will actually be an appointed position. 

YouDecide provincial petition fails to meet required signatures, must reset

National petition for referendum continues as UTSU executives take hard stance on defederation from CFS

YouDecide provincial petition fails to meet required signatures, must reset

The YouDecide campaign, which is promoting a petition to hold a referendum on the UTSU’s membership in the Canadian Federation of Students (CFS), has had to reset its provincial petition due to a lack of signatures needed by the designated deadline.

Headed by Adrian Huntelar, the YouDecide campaign is a student-run endeavour to collect a sufficient number of signatures on a petition to initiate a referendum on the UTSU’s membership with both the national CFS and its Ontario chapter. The campaign has garnered over 1,000 signatories since the start of orientation week.

“So far [the campaign] has been very grassroots,” Huntelar said. “It’s been very much just a collection of individuals who are interested in the idea of having this referendum as soon as possible.”

YouDecide was formed in September 2016. According to Huntelar, the objective of the YouDecide campaign is to garner enough signatures to initiate a referendum by the end of this year. In order to accomplish this, the campaign must collect signatures from 15 per cent of the UTSU membership on the St. George campus. Of the 43,000 students represented, YouDecide must obtain approximately 7,000 signatures.

The campaign is complicated by the existence of two petitions, one regarding the national CFS and one regarding the provincial chapter, CFS-Ontario. While the signatures collected last year for the national petition carried over, the expiratory clause in the provincial petition required restarting from the beginning. According to CFS-Ontario bylaws, a petition for a referendum on membership must include the exact dates of the proposed vote. The YouDecide petition for CFS-Ontario included dates that have passed this point, which requries them to begin a new petition entirely.

Despite this, Huntelar remains hopeful for the campaign’s efforts.

“So far I’ve seen a great amount of interest,” Huntelar said. “When we talk to students and when we make our case for why they should be able to make this decision for themselves, the vast majority of them agree and the vast majority of them who we talk to do sign the petition and are very enthusiastic about having a referendum.”

YouDecide and the UTSU

While Huntelar said there is no official relationship between the YouDecide campaign and the UTSU, and that the campaign itself remains a disinterested actor with regard to the outcome of the possible referendum, UTSU executives are unequivocal in decrying the CFS.

“The CFS wants every local to do the same thing at the same time, and that’s a barrier to effective advocacy,” UTSU President Mathias Memmel wrote in an email to The Varsity. “Campaigns are developed centrally by CFS staff and then shipped across the country. It doesn’t work. There’s no single student experience, and there’s no single set of student needs.”

In an email to The Varsity, CFS Chairperson Coty Zachariah confirmed that “a decision on continued membership rests with students through a democratic vote.” He reiterated that membership in the federation “allows U of T students to benefit from being part of an organization that, in the last few years, has won a 50% increase to the Canada Student Grants program, $90 million in new funding for Indigenous students, and legislation requiring universities in Ontario to implement standalone sexual violence policies.”

Current UTSU Vice-President Internal Daman Singh shared Memmel’s criticism in a separate email, saying that “the CFS shuts out the voices of members who suggest different priorities than those decreed by the National Executive. There are frequent, demonstrable instances of corruption, ranging from serious concerns such as the secret bank account… to simpler issues such as the disclosure of documents and financials to member locals.”

Singh played a major role in the YouDecide campaign last year, but neither he nor Huntelar believes Singh’s past involvement with the campaign constitutes a conflict of interest.

The CFS did not comment on the matter. “The CFS is a hindrance, not a help,” Singh wrote to The Varsity. “The UTSU has no reason to stay. I have complete confidence in the You Decide campaign. There’s no conflict between my role in the campaign and my role as an executive. I’ve always been completely transparent about my position on this issue.”

CFS still receiving revenue from programs linked to secret bank account

Summary report of audit reveals CFS receives revenue from travelcuts

CFS still receiving revenue from programs linked to secret bank account

The Canadian Federation of Students (CFS) is still connected to travelcuts, the travel agency it used to co-own, by way of a secret bank account that was revealed in a summary report of an audit released this summer. The CFS issues International Student Identity Cards (ISIC) and also receives revenue from the Summer Work Abroad Program (SWAP).

The original purpose of the bank account was to pay off debt from travelcuts — which the CFS sold to Merit Travel Group in 2009 — but it was also used for unauthorized transactions.

“Today Merit has a services agreement with the CFS-S, which is the Canadian Federation of Student Services, to operate the SWAP program, the Summer Work Abroad Program, and to be an alternative issuer of ISIC cards through our travel business,” a spokesperson for Merit told The Varsity.

The business of ISICs

In the summary report of the audit, there are 27 transactions listed as “International Student Identity Card applicant,” with the total sum of money from those transactions amounting to $584.

According to the CFS budget from 2001–2002, the federation received around $1.1 million in revenue from travelcuts between 1999 and 2000.

The CFS has not released the full report of the audit, meaning that any information on where the money came from or where it went is unknown.

According to the audited CFS financial statement of the 2013 fiscal year, the CFS recorded a loss of $37,506 from “ISIC income.”

In the 2016 fiscal year, the CFS had a net loss of $96,366.73 from the cost of selling ISICs.

In Canada, the CFS owns the license for distributing ISICs, but travelcuts, under Merit’s services agreement, can also sell the cards.

“Today, however, the majority of ISIC cards are distributed as a benefit of membership so the program doesn’t generate profit,” CFS National Treasurer Peyton Veitch told The Varsity via email.

Veitch detailed that the ISIC is a free benefit of membership in the CFS, but $20 for everyone else. The individual amounts from the 27 ISIC transactions in the secret bank account varied among $20, $21.50, and $43.

According to a draft report from a 2016 UTSU ad hoc committee on the CFS, in 2014­–2015, the CFS received revenue of $120,000 from the sale of ISICs.

“But what is the point of an ISIC? In theory, the cards grant access to student discounts, but most student discounts are available to anyone with a valid student ID; there are few, if any, discounts available only to students who have ISICs,” the draft report reads. “In short, the value of ISICs is overstated, principally by the CFS (which is, again, a partial owner of the for-­profit travel agency that issues ISICs).”

Veitch added, “The Federation also receives around $5,000 each year related to promoting Merit Travel through SWAP.”

U of T professor Richard Powers, whose areas of expertise include business and corporate law, wrote to The Varsity that “student governing organizations often own and run services for students – printing centres, pubs, housing co-ops – nothing sinister about that.”

Powers did question what happens to the profits from CFS businesses. “They should be going back into improvements in the services, or into other student-related activities and services – not into someone’s pockets,” he said.

Selling travelcuts

The spokesperson for Merit said that “the interesting thing about the deal was… we did not buy the shares of the travelcuts business. We bought the assets of the travelcuts business.”

In a share deal, the buyer acquires 100 per cent of the company’s shares, meaning that it takes on any and all pre-existing liabilities.

In an asset deal, the buyer can pick and choose the parts of the company that they want to purchase, which means that they do not have to take on any unwanted liabilities.

“In order not to be responsible for the liabilities (debts, etc.) you just buy assets–the liabilities remain with the seller,” said Powers.

UTSU Vice-President Internal Daman Singh wrote in an email to The Varsity that in principle, there’s nothing wrong with a student organization like the CFS securing discounted goods and services for students.

“However, the CFS mismanaged Travel CUTS into bankruptcy, and now the CFS seems to be a partial owner of a for-profit travel agency. The whole arrangement is very strange, and the members of the CFS know very little about it,” Singh wrote. travelcuts went into receivership in October 2009, when it was bought by Merit Travel, after incurring severe debt.