Former St. John’s business owner sentenced for fraud

The Canada Revenue Agency (CRA) announced that Gary Hennessey was sentenced on June 4, 2019, in the Provincial Court of Newfoundland and Labrador in St. John’s to a conditional jail sentence of 15 months. Mr. Hennessey was found guilty of fraud over $5,000 against the Canada Revenue Agency.

A CRA investigation revealed that Gary Hennessey operated a payroll services business as a sole proprietorship, under the name of Administrative Services, providing assistance to recipients of home care support provided by the Eastern Regional Health Authority, commonly known as Eastern Health. 

In the period from December 31, 2005, to December 31, 2007, Gary Hennessey diverted funds from Eastern Health that had been paid to him in trust, for the purposes of making remittances to CRA. He wilfully chose to use these funds to pay himself and his personal expenses and debts, in excess of the amount he was entitled for that period.

All case-specific information above was obtained from the court records.

Wilfully failing to follow tax laws could result in serious consequences, including reassessments, the imposition of civil penalties and criminal tax investigations and prosecutions resulting in the imposition of court fines and jail time. Under the income tax and excise tax laws, persons convicted of tax evasion will face fines ranging from 50% to 200% of the evaded taxes and up to five years imprisonment. If convicted of fraud under Section 380 of the Criminal Code, an individual can face up to 14 years in jail.

The Voluntary Disclosures Program (VDP) may give you a second chance to change a tax return you previously filed or to file a return that you should have filed. A VDP application must be accepted by the CRA. Acceptance means you will pay the taxes owing, plus any applicable interest but you will be eligible for relief from prosecution and, in some cases, from penalties. For more information, go to Canada.ca/taxes-voluntary-disclosures.

The CRA has set up a free subscription service to help Canadians stay current on the CRA’s enforcement efforts.

Associated Links

• Informant Leads Program
• Voluntary Disclosures Program

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Contacts

Anne Pachal
Canada Revenue Agency
902-426-5784