The Canada Revenue Agency has revoked the charitable registration of The Children’s Emergency Foundation, a Toronto-area charity.
This revocation was effective May 9.
“It is our position that the charity devotes a preponderance of its resources to furthering non-charitable activities,” the CRA said.
A CRA audit revealed that the charity has devoted a significant portion of its resources to the promotion of two tax shelter donation arrangements, an international donation arrangement and has devoted a substantial portion of its actual cash donations to fundraising and administrative expenses.
The charity reported receiving cash and non-cash gifts totaling in excess of $57.8 million from donors and charities that participated in the tax shelter and international donation arrangements, the CRA said.
Of this amount, $46.7 million consisted of non-cash gifts, which the charity reported distributing as part of its own activities. “However, the charity’s records fail to substantiate the values represented, whether the property was ever in the charity’s possession, that the property was distributed or even if the property actually existed,” the CRA said.
The remaining $11.1 million was received as tax-receipted cash donations. Of this amount, the charity directed $7.9 million to fundraising and administrative fees, while devoting only $3.2 million to its own charitable activities,” the CRA said.
IE