Enforcement Notification - Tax Evasion: Convicted of tax fraud: temporary staffing agencies' director fined $999,000
TORONTO, Sept. 8, 2023 /CNW/ - The Canada Revenue Agency (CRA) announced that Kwang Won Lee, of Mississauga, Ontario, was sentenced in the Toronto Courthouse on September 7, 2023, to a conditional sentence of two years less a day and a fine of $999,000, after pleading guilty on June 27, 2023, to one count of fraud over $5,000 under the Criminal Code for evasion of federal income tax.
A CRA investigation revealed that Lee failed to report personal income in the amount of $3,072,919 on his individual income tax returns for the years 2013 to 2016 inclusively. Lee appropriated these funds from unreported sales and from unreported or unremitted Goods and Services Tax/Harmonized Sales Tax of Sovereign Staffing Inc. (SSI) and Talent Savvies Inc. (TSI), of which he represented himself as the owner. By doing so, Lee evaded a total of $867,729 in taxes.
SSI and TSI provided temporary labour services in the Greater Toronto Area and used multiple bank accounts for their business operations, but only reported one account to the CRA, allowing Lee to appropriate some of the funds from the other bank accounts used.
Lee was required to pay $749,963 of the fine upon sentencing with the balance to be paid before September 7, 2025.
All case-specific information above was obtained from the court records.
In addition to court imposed fines and/or jail sentences, convicted taxpayers have to pay the full amount of tax owing, plus related interest and any penalties assessed by the CRA.
The CRA is committed to fighting tax evasion, tax fraud, and other serious tax crimes. There are serious consequences to breaking the law. Those who do not fully comply with the tax laws place an unfair burden on law-abiding taxpayers and businesses, and jeopardize the integrity of Canada's tax base. While investigations can be complex and take years to complete, the CRA is committed to taking action against cases of non-compliance. For more information, go to Tax evasion, understanding the consequences.
The CRA is dedicated to maintaining the integrity of Canada's tax system, thereby contributing to the social and economic well-being of Canadians. 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. Any individual or business who underreports income or claims losses or benefits to which they are not entitled may have to repay the benefit amounts and may be subject to other possible action.
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SOURCE Canada Revenue Agency
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