Protesters outside Baibombeh School in Whitefish Bay demanded answers from the education authority and band council, during a showdown Thursday.

KENORA, Ont. - A northwestern Ontario native community's only school was closed Thursday after accusations of lost money and an over-stepping band council escalated into protests.

Baibombeh School in Whitefish Bay, about 95 km south of Kenora, Ont., has been at the centre of controversy for the past few months, and has split the small community.

The situation started earlier this year, when the reserve's 2009 audit revealed the band was in deep debt.

Much of that debt could be traced back to failed investments the band council made into a number of local businesses and a spending spree that included building a new health centre and seniors' residence for the community.

Matters only got worse when the band council essentially took over the local education authority - firing the school's board and the education director, citing they were not being co-operative.

That led to accusations from the community that the band council was raiding school for money to make up for their shortfall.

"Chief and council are broke and they're looking for money and the only place they can find it is the school," said Ken Kakeway, who was joined at the entrance of the school Thursday by a group of elders and other community member.

He's accused the band of taking at least $1 million from Baibombeh School so far.

That's led to fears payroll may not be met. The school's principal and several teachers have recently quit the school which teaches students from kindergarten to Grade 12.

So far Chief Warren White and the rest of the band council has been mum on the matter, and have not spoken to media or protesters.

There is no word on how long the protests might continue.