A major Pilbara Aboriginal corporation has landed in hot water with the Indigenous corporations watchdog over the payment of ‘hardship’ loans to directors.

An Office of the Registrar of Indigenous Corporations report handed down in March found Yindjibarndi Aboriginal Corporation directors collected thousands of dollars in breach of protocols.

The notice of compliance letter outlined suspected failures to comply with a number requirements after external examination found YAC gave loans and cash payments to directors from July 2018.

The loans exceeding a collective $7000 were extended for purposes outside of YAC objectives.

It was determined each were unlikely to be paid back within 12 months of payment.

YAC chief executive Michael Woodley said the loans were isolated incidents given to directors facing tough times and intended be recouped.

“Although that is labelled as loans to directors, it was more of a contribution to the hardships that they were facing, and something that we thought we could manage,” he said.

“This was just more of a one off type of support.”

The examination found cash payments of $500 were received by 11 directors for attending meetings.

While the relevant Act allows for remuneration for travel costs and in other circumstances, the payments were found to fall outside of these provisions.

According to the ORIC report directors were paid $500 (in hand) plus superannuation to any meetings in their capacity as a director of the Corporation.

The reimbursement of travel expenses was labelled as an exaggeration given the majority of directors live in and around Roebourne, where most meetings were held.

YAC claimed the categorisation of these payments as ‘sitting fees’ undermined contributions made by directors, and changes would be made to maintain appropriate payment of directors.

“We’ll obviously immediately start looking at that and making sure that it fits within the corporation’s rulebook, and the guidelines of the CATSI rulebook,” Mr Woodley said.

Examiners reported these payment irregularities and breaches were in contradiction to the CATSI Act.

“It appears payments out of the corporation’s money are being approved and made by persons who no longer have the delegated authority to do so,” the report said.

Mr Woodley said a resolution was made by the board to give consent to individuals to make these payments and that an accountant was brought in shortly after the transfers.

It was found the corporation also failed to hold annual general meetings before required dates, hold quarterly directors meetings, keep record of the duration of meetings held and inform applicants of their membership status per requirements of the Act.

YAC also fell behind on lodging financial records.

In August the corporation provided audited consolidated financial statements for the year ending June 2018 to the registrar but has not yet lodged for the following three periods.

They are currently waiting on information from associated businesses, expected to be delivered soon.

Mr Woodley said ORIC’s examinations were important for good governance and good management.

The notice of compliance outlines a number of dates for documents to be delivered, breaches to rectify and ongoing directions.

YAC has been instructed loans are not to be given in future.