The RCMP Wednesday charged six men amid allegations that they were involved in an illegal tax shelter that cost the federal government millions in tax revenue.
The RCMP announced that its Greater Toronto Area (GTA) Financial Crime team arrested and charged six people in connection with an allegedly ‘fraudulent investment scheme’ that, it says, costs thousands of investors and the federal government millions of dollars. Indeed, it estimates that the scheme may have cost the government more than $200 million in tax revenues.
According to the RCMP, it launched an investigation in April 2012 after learning about a possible ‘tax avoidance scheme’. It says that the investigation found that, since 2004, thousands of investors were enticed to participate in an alleged illegal tax shelter in which they were led to believe that they could legitimately purchase a company’s business losses that could then be used to lower their taxable incomes.
However, police allege that many of the losses were fraudulent because the companies involved with the accused did not have agreements for their losses to be transferred over to third parties. Also, in other instances, the businesses that provided the losses were controlled by the accused; and, it alleges that these losses were fabricated. “In many instances, these business losses resulted in substantial illegitimate income tax refund cheques being issued to these claimants off the backs of taxpayers,” it says.
Six people (Vincent Villanti, 66 of Whitby, Ont.; Shane Davidson Smith, 46, Peterborough, Ont.; David Prentice, 52, of Oakville, Ont.; Ravendra Chaudhary, 65, of North York, Ont.; Andrew Lloyd, 42, from Pickering, Ont.; and, Joe Loschiavo , 49, of Etobicoke, Ont.) have been charged with two counts of fraud over $5000, and for the commission of an offence for a criminal organization. The allegations have not been proven. The accused are scheduled to make their first court appearance today, March 26, at Old City Hall Courthouse in Toronto, Ont.
Police say that the companies used in the scheme include: Integrated Business Concepts (IBC), Synergy Group 2000, Cason Global Wealth Association (CGWA) and IBCA 2009.
“The RCMP is committed to protecting Canadians from fraudulent investments that serve to undermine the integrity of Canada’s financial systems.” stated Inspector Henry Tso of the RCMP’s Financial Crime Section. “Maintaining Canada’s economic integrity is a priority for the RCMP and we will continue to work diligently to bring these criminals to justice.”
The RCMP noted that the Canada Revenue Agency (CRA), Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) and the Ontario Securities Commission (OSC) assisted the investigation.