CRA Charge 4 “Tax Protestors” in Quebec with Tax Evasion

The Canada Revenue Agency (CRA) have charged a quartet of “tax protesters” in Québec with tax fraud, alleging that the 4 operated a scheme which helped over 50 participants evade more than $1 million in federal income tax.

Allegations, not yet proven in court, claim that they advised 50 taxpayers to claim losses totalling more than $19 million in losses, or close to $1.08 million in federal income tax.

Pierre Cardin and Sylvain Quirion of Montreal, Jean-Marc Paquin from Laval, and Contrecoeur resident Guylaine Tremblay were arrested and released with a promise to appear, and court-imposed conditions, the CRA reported.

The CRA used this opportunity to reiterate its warning against getting involved with tax protestors, noting that Canadian courts have consistently rejected these schemes.

“For those involved in tax protester schemes, the CRA will reassess income tax, calculate interest and impose penalties,” the announcement says. “In addition, upon a conviction for tax evasion, the court may impose a fine between 50% and 200% of the tax evaded and a jail term of up to five years.”

Earlier this year, the CRA issued an alert about tax schemes claiming that, “natural people” are not subject to tax laws, because it’s not true.

“Individuals who promote such views are “tax protesters” who not only fail to report their own earnings, but they also try to convince others to engage in these illegal activities,” the CRA said in the alert.

The CRA has always kept an eye on these sorts of schemes and regularly uses the opportunity to promote situations where charges are laid, or where the court charges fraudsters in order to remind Canadians to steer clear of this type of tax evasion.

Recently, the CRA reported that, between 2006 and 2017, 75 promoters had been convicted in connection with these kinds of schemes, resulting in $7.15 million in fines and a total of 936 months of jail time.

If someone is charging you money to teach you how to pay less tax, you might want to steer clear.

If, however, you have taken part in a scam, or scheme, or if you believe that you are a “natural person” and that taxation does not apply to you, please send me an email to info@intaxicating, so we can discuss the very significant consequences which you can face.

I won’t judge you.  I’ll listen, and I’ll explain and answer questions.

 

 

 

Advertisements

Cobourg, Ontario Resident Sentenced by CRA for Tax Evasion.

The Canada Revenue Agency (CRA) announced that, on December 4, 2017David Porter Wilson of Cobourg, Ontario, was sentenced to a fine of $97,173 after pleading guilty in the Ontario Court of Justice in Cobourg, Ontario, to two counts of income tax evasion.

In addition to the court imposed fine, Wilson will also have to pay the full amount of tax owing, plus related interest and any penalties assessed by the CRA.

A CRA investigation revealed that Wilson failed to report income that he earned as a commissioned salesperson for a marketing company, totalling $449,745 on his personal tax returns for 2006 and 2007, thereby evading federal income taxes totalling $97,173. While under investigation, Wilson left Canada, and after the charges were laid an arrest warrant was issued on September 7, 2011. Wilson did not return to Canada until August 9, 2017.

All case-specific information above was obtained from the court records.

The CRA takes tax evasion very seriously.

Tax evasion occurs when an individual or business wilfully ignores or disregards Canada’s tax laws. For example, those participating in tax evasion under-report taxable income or claim expenses that are non-deductible or overstated.

Those who do not fully comply with tax laws place an unfair burden on law-abiding taxpayers and businesses and jeopardize the integrity of Canada’s tax base.

For the five-year period of April 1, 2012 to March 31, 2017, the courts have convicted 408 taxpayers – This involved $122 million in federal tax evaded and court sentences totaling approximately $44 million in court fines and 3,103 months in jail.

If you have made an omission in your dealings with the CRA, made a tax mistake or left out details about income on your tax return, the Agency may give you a second chance to correct your tax affairs and avoid criminal prosecution.

The Voluntary Disclosures Program (VDP) may give you the opportunity to come forward, make things right, and have peace of mind. Disclosures that are made before the CRA launches an enforcement action such as an audit or criminal investigation may only result in you having to pay taxes owed plus interest. That being said, the VDP is currently under review. Changes were announced in the fall of 2017. More information on the VDP can be found on the CRA’s website at Canada.ca/taxes-voluntary-disclosures.

The CRA has set up a free subscription service to help Canadians stay current on the CRA’s enforcement efforts.

Associated Links

Offshore Tax Informant Program
Informant Leads Program
Voluntary Disclosures Program

Stay Connected

To receive updates on what is new at the CRA, you can:

SOURCE Canada Revenue Agency

Former Calgary man sentenced to 11 years in jail and fined $550,892 for tax evasion and fraud

The Canada Revenue Agency (CRA) announced that James Harvey Cameron, a former resident of Calgary, has been sentenced to 11 years in jail and fined $550,892 after defrauding investors of over $2.5 million through a deceptive investment scheme. The judge also ordered Cameron, 66, to pay restitution of $1,831,700 to his victims.

If Mr. Cameron fails to pay his fine in six months he will have to serve an additional four years in jail for default.

From 2002-2006, Cameron operated a fraudulent RRSP scheme which promised a 2% monthly return to individual investors. The scheme raised just under $8 million, but only paid out a total of $882,000 to investors.  Cameron misappropriated the funds to support his luxurious lifestyle, including buying property, cars, a horse, and a $75,000 cruise in the Bahamas. He also transferred funds offshore to Barbados.

A Canada Revenue Agency (CRA) investigation proved that Cameron diverted $3.9 million of the investors’ funds for his own use and failed to report this as income on his tax returns, evading $1,132,882 in taxes.

“I have no doubt whatsoever that [Cameron] executed a deceptive investment scheme with subjective knowledge of the prohibited act and consequences,” said presiding judge, Justice P.R. Jeffrey, in his written reasons for convicting Cameron. “The CRA acted towards him with considerable patience, forbearance and fairness.  He was given ample opportunity to provide to CRA any plausible alternate explanation for what occurred, yet did not.”

Justice Jeffrey commented in his sentencing report: “The $1,831,700 I have ordered payable in restitution should be subtracted from his [Cameron] total taxable income… therefore I find his taxable income to have been $2,118,817.”

Cameron was convicted of tax evasion under the Income Tax Act and fraud under the Criminal Code.

Sentencing took place today at the Court of Queen’s Bench in Calgary.

You can report suspected tax evasion to the CRA by visiting https://www.canada.ca/en/revenue-agency/programs/about-canada-revenue-agency-cra/informant-leads-program.html or by calling the National Leads Centre at 1-866-809-6841.

All case-specific information in this news release was obtained from the court records.

Did you know that between April 1, 2012, and March 31, 2017, total domestic and offshore related criminal investigations have resulted in 408 convictions involving $122 million in federal tax evaded and court sentences totaling approximately $44 million in court fines and 3,103 months in jail?

“New” CRA Powers are Not so New after all! Unless…

Recent radio advertising and newspaper or online articles would have you believe that the CRA has been ramping up staff in order to break down your door in the middle of the night and arrest you for tax fraud.

Deep down inside you knew that you should have opened a BN number and GST/HST account for your child\s lemonade stand because even though they were significantly under the $30,000 sales threshold, if registered, you could have claimed the Input Tax Credits – but you didn’t and the CRA wants their money!

You also know that if you had a question, the CRA call centre were going to mislead you, or lie to you so that you would be forced to pay even more money.

You also know that you might need help for a tax accountant, tax lawyer, tax broker, tax solutions firm, or tax audit specialist… but you cannot choose because the different names must mean they do different things and you don’t know which category you fall into, and … the CRA are so coming to get you… now!

(Is that rustling in the bushes in front of my house?)

spyingWell all of these new powers and the threats that they are going to break-down your door and arrest you on the spot are not really true.

You only have to fear the CRA breaking down your door (really the RCMP, but I’m sure the CRA would be there somewhere along the way) if you have done something wrong.  Very wrong.  Criminally wrong.

You should be concerned if the CRA knows you’ve done something criminally wrong, or have been involved in terrorist financing or activity because they’ll pass that along to the police.

The Canada Revenue Agency gained the little-noticed new authority, which does not require a judicial warrant, through an amendment tucked into the government’s most recent budget bill.

Previously, confidentiality provisions in the law prevented the CRA from handing information about suspected wrongdoing, on its own initiative, to law enforcement.

The exception was information that pointed to tax-related crimes.

The new provisions apply to offences including breaking and entering, vehicle theft, arson, corruption and kidnapping and in return, the CRA can now receive information from local authorities about any offence with a minimum prison term, or one with a maximum sentence of 14 years.

The list of offences is broad and is a significant shift in confidentiality policy allowing the CRA to pass along information to law authorities without a court-ordered warrant, even when the alleged crime(s) have nothing to do with taxes.

Interim procedures for administering the new powers were issued to all CRA employees in June 2016 not too long after the legislation received royal assent.

The intended use of this new tool, is that an exchange should occur when an employee gathers information in the course of their regular duties.

This information exchange was intended to be one-way and would be closely controlled through a set of strict criteria.

As an aside, it would have been nice to know who might be carrying on criminal activity, when I was working at the CRA and went to visit a business to determine why they stopped filing GST returns, only to learn that they were conducting illegal activities and was physically threatened before getting the heck out of there.

The following day the RCMP showed up, cleaned out the place and arrested the operators.

I never did get my outstanding GST returns, however, which could have been prosecuted as a criminal offense (but was not).

All potential referrals to police will be vetted by the agency’s criminal investigations personnel and must be approved by the assistant commissioner of the department’s compliance programs branch, CRA has reported.

The key points to remember are this;

  1. If you happen to have partaken in a criminal activity, you might not want to disclose that to the CRA collector.
  2. Make sure to stay compliant!  File up to date and don’t give the CRA reasons for looking for stuff.
  3. Take all of the tax-related advertising with a grain of salt.  Their intention is to scare you and force you to drop a ton of cash at their business.  Instead, I recommend you do your research, ask questions and get the solution that fits your tax problem.
  4. If you’re not sure… Ask.  Then use your judgement.

 

CRA Announces Conviction: Seeking Victim Impact Statements by April 20th.

The Canada Revenue Agency (CRA) has announced that James Harvey Cameron, from Calgary, was criminally convicted on March 28th of creating and operating a fraudulent RRSP scheme.

According to court documents, from 2002 to 2006, Cameron was the master-mind behind a fraudulent RRSP scheme through which he diverted $2.5 million of investors’ funds for his own use. He also failed to report the money as taxable income, evading federal taxes totalling $673,871.

The CRA considers these offenses serious, and the courts found Cameron guilty of tax evasion and fraud.

A date for a sentencing hearing has yet to be set, but is likely to take place between April 24 and May 12, 2017.

The CRA is encouraging victims of Cameron’s fraud who wish to appear at the sentencing hearing to seek restitution or make a victim impact statement to contact the Public Prosecution Service of Canada at 403-299-3978 by April 20th.