Family Forum / Parenting / Adoption / July 2009

http://news.therecord.com/News/Local/article/576431

Imagine Adoption board member speaks out on bankrupt Cambridge agency
expenses
July 28, 2009
BY BRIAN CALDWELL, RECORD STAFF
CAMBRIDGE — The husband and wife who headed a non-profit Cambridge
adoption agency that went bankrupt two weeks ago earned a combined
total of $320,000 a year.

Susan Hayhow, executive director of Kids Link International Adoption
Agency and two related organizations, had an annual salary of
$180,000.

Her now-estranged husband, Rick Hayhow, made $140,000 a year as chief
financial officer of Kids Link — which operated as Imagine Adoption —
and the Saint Anne Adoption Centre until he resigned in April after it
came to light that his wife was in a relationship with another
employee.

Their six-figure salaries were the first indications of trouble for
two members of the agency’s board of directors who later went to
police with allegations of hundreds of thousands of dollars in
improper expenses.

“Everybody has to live,” said Alan Brown, one of the volunteer
directors who raised concerns. “There’s a reasonableness to
everything. But when I heard those numbers, I was like, ‘You’ve got to
be kidding me.’ ”

On top of their salaries, the couple both drove vehicles leased to the
agency — Susan a $72,000 Lexus and Rick a Nissan Pathfinder worth
$42,000.

Brown said the two directors did a check of the agency’s finances and
turned up more than $300,000 in suspect expenses starting in early
2007.

Included were the purchase of a $3,000 horse and a $2,700 saddle, a
one-week, $13,000 hotel stay in New York last Christmas, two trips to
Disney World in Florida, clothing purchases from Holt Renfrew and
extensive work at the couple’s Cambridge house, such as the
installation of a $13,500 wrought- iron fence.

“It’s absolutely insane,” said Brown, who spoke publicly Monday for
the first time since the agency collapsed. “There are tons of
ridiculous purchases.”

Bankruptcy trustees have been working with government officials to
complete about 40 adoptions, mostly from Ethiopia, that had reached
the stage where Canadian families were matched with children.

Clients who hadn’t reached that step have been lobbying the province —
which licenses international adoption agencies — to help see their
cases through as well.

Representatives of about 400 families are scheduled to meet Tuesday
with Deb Matthews, the minister of children and youth services.

Many of them have invested months of time and $20,000 or more in the
hopes of adopting needy children from overseas.

“There were all manner of expenses (to the agency),” Brown said. “When
the families see the list of what was bought … it’ll make them sick.”

Part owner of a software development company in Cambridge, Brown said
he had known the Hayhows for about eight years when he became an
Imagine board member in 2008.

About a year later, in May of this year, Brown said an emotional Rick
Hayhow invited him to breakfast to discuss the breakup of his
marriage.

Susan Hayhow had begun a common-law relationship with Andrew Morrow,
the third director of Imagine and an employee of Global Reach
Children’s Fund, the other related organization.

Brown said Rick Hayhow told him he had resigned because of the affair
and that he been given a year of continued salary, plus the use of the
Pathfinder, as severance.

Alarmed by the amounts involved, Brown said he contacted fellow board
member Chris Hughes and they began going through financial records.

“The salary was a number that floored me when I first heard it,” Brown
said. “I had no idea they were drawing those types of wages.”

Brown said they found numerous questionable expenses and determined
Imagine was so strapped for money that bankruptcy was the only option.

Although the agency had about $500,000 in bank accounts, he said, the
money was supposed to be held in trust for clients and couldn’t be
used to pay the staff of 15 or meet other operating expenses,
including $50,000 to $70,000 a month to run a transition home in
Ethiopia for children matched with Canadian families.

“The reason we put it into bankruptcy was to protect the families,”
Brown said. “If we hadn’t, they would have lost everything.

“We had to protect the remaining money that should have been in trust.
The way the business was running, the monthly expenses would have
consumed all of those funds in less than 90 days.”

Brown said the two directors consulted a lawyer and froze the agency’s
bank accounts.

They also stopped paying Rick Hayhow his severance and took Susan
Hayhow off the payroll.

Brown said he spoke out so affected families understand the nature and
seriousness of concerns about the agency.

Hughes, a long-time trustee for the agency, could not be reached by
The Record.

Brown said he also wants it known that he found no evidence of
wrongdoing by other employees of the agency — including Valerie
Goodyear, wife of Cambridge MP Gary Goodyear.

Brown said the agency never received any government money or
preferential treatment.

“The Goodyears don’t have anything to do with it,” he said.

“None of the staff knew anything about the finances in the
organization. That was all very closely held.”

Since the bankruptcy, the accounts of Saint Anne and Global Reach have
also been frozen because money was flowing between all three
organizations. Some directors and senior staff members also held
multiple positions, raising conflict-of-interest concerns.

“The finances and the books are a disaster for all three of them,”
Brown said.

Waterloo Regional Police are conducting a fraud investigation into
Imagine after meeting with Brown and Hughes last week. The first
meeting of the agency’s creditors is scheduled for Thursday.

Morrow has not returned repeated calls from The Record. Rick Hayhow
and Susan Hayhow couldn’t be reached for comment.

bcaldwell@therecord.com