Canada Revenue Agency: Mississauga Chartered Accountant Sentenced to Jail and Fined for Tax Fraud Scheme

BRAMPTON, ONTARIO--(Marketwired - May 6, 2013) - The Canada Revenue Agency (CRA) announced today that Mr. Imad Kutum pleaded guilty on November 27, 2012 in the Ontario Court of Justice in Brampton, to one count of fraud over $5,000 under the Criminal Code. He was sentenced to two years in jail and a fine of $100,000.

Mr. Kutum, a chartered accountant, operated Kutum and Associates, providing tax preparation services and accounting related services. A CRA investigation discovered that false charitable donation claims totalling $3,674,000 were made on 487 income tax returns prepared by Mr. Kutum for clients for the 2003 to 2008 tax years. The false claims were supported by fraudulent charity receipts. The false claims reduced the amount of federal taxes owed by $1,045,111.

The information in this news release was obtained from the court records.

"Canadian taxpayers must have confidence in the fairness of the tax system," said Darrell Mahoney, Assistant Commissioner, Ontario Region, CRA. "To maintain that confidence, the Canada Revenue Agency is determined to hold tax evaders accountable for their actions."

Taxpayers who claim false expenses, credits or rebates from the government are subject to serious consequences. They are liable not only for corrections to their tax returns and payment of the full amount of tax owing, but also to penalties and interest. In addition, if convicted of tax evasion, the court may fine them up to 200% of the tax evaded and sentence them for up to a five-year jail term.

Taxpayers who have not filed returns for previous years, or who have not reported all of their income, can still voluntarily correct their tax affairs. They may not be penalized or prosecuted if they make a valid disclosure before they become aware of any compliance action being initiated by the CRA against them. These taxpayers may only have to pay the taxes owing, plus interest. More information on the Voluntary Disclosures Program (VDP) can be found on the CRA's Web site at www.cra.gc.ca/voluntarydisclosures.

Further information on convictions can also be found in the Media Room on the CRA website at www.cra.gc.ca/convictions.