Revenue minister alleges at least three companies involved in tax fraud scheme

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Revenue minister alleges at least three companies involved in tax fraud scheme


By Peter Rakobowchuk, The Canadian Press
MONTREAL - Revenue Minister Jean-Pierre Blackburn says at least three companies and four Canada Revenue Agency employees have been involved in an alleged $4.5-million tax-fraud scheme.
Two of the four employees of the Montreal tax-services office have been arrested and two others suspended without pay, Blackburn told a news conference Wednesday
The two arrested workers, who were also suspended, allegedly tried to shield their activities by falsifying documents.
"The Canada Revenue Agency has reasons to suspect that three companies under investigation - Simard-Beaudry Construction Inc., Construction Louisbourg Ltee., and Hyprescon - funnelled close to $4.5 million to two dummy corporations that have no commercial viability and that were part of a false invoicing scheme," Blackburn said.
The federal minister stressed the investigation did not put into question, "the honesty and the integrity of the vast majority of professionals at the Canada Revenue Agency."
None of the allegations has been proven in court.
Patrice Chouinard, director of the revenue agency's Montreal office, said the arrests were the result of a three-stage investigation called Project Legaux.
Chouinard said according to the investigation, a numbered company and another firm supplied phoney bills which were allegedly used to fradulently reduce the revenues of Simard-Beaudry, Construction Louisbourg and Hyprescon.
The revenue agency alleges individuals or companies obtained "convenience" invoices in the scheme from an inactive company for fictitious work.
The invoices were allegedly used to fraudulently reduce the individuals' or companies' revenues.
The resulting tax savings were then allegedly shared by the scheme's participants to use as payoffs or for paying salaries under the table.
 
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