A Brampton tax preparer has been sentenced to three years in jail after he pleaded guilty to falsely claiming $34 million worth of charitable donations on tax returns he prepared for his clients.
The sentencing was announced by Canadian tax authorities in a recent news release along with details from the court proceedings.
According to the Canada Revenue Agency (CRA), Festus Bayden was a partner in a tax preparation business known as E & F Tax Associates. Also, the business also went by Bankay Financial Services, Inc. in Toronto and Brampton.
A CRA investigation detected that Bayden claimed over $34 million in false charitable donations on individual income tax returns that he prepared for over 30 clients for the 2004 to 2006 tax years.
CRA said: “Bayden told his clients that a larger refund or reduced taxes could be obtained if they made a charitable donation for an amount that was far less than what was actually claimed on their income tax returns. Bayden then provided his clients with false charitable donation receipts in the names of various charitable organizations to which he was connected.”
Bayden charged his clients around 10 percent of the face value of the false charitable donations that were claimed.
He fled Canada after he was charged, but was taken into custody when he returned to Canada on June 13, 2023.
On February 27, 2024, he was sentenced to three years in prison by Ontario Court of Justice in Brampton after he pled guilty to one count of fraud over $5,000.
CRA said it is committed to going after tax promoters that promote or sell schemes that aim to break or bend the rules of Canadian tax laws. The agency said both the promoters and their clients would be held responsible.
CRA said: “The CRA continues to aggressively pursue tax evasion and false claims with all the tools available to it. The CRA works to make sure that individuals and businesses report all income earned and only claim benefits to which they are entitled so that important benefit programs can be administered to those who need them.”
