Burlington business owner sentenced to 36 months in jail for tax fraud
January 12, 2023
Canada Revenue Agency
The Canada Revenue Agency (CRA) announced today that Thaddeus Danek (Danek), also known as Ted Danek or Thaddeusz Danek, of Burlington, Ontario, was sentenced on January 11, 2023, to 36 months in jail for fraud over $5,000 under the Criminal Code. Mr. Danek was also fined a total of $728,129. The fine represents 100% of the amount of Goods and Services Tax/Harmonized Sales Tax (GST/HST) claims Mr. Danek unlawfully obtained as refunds. Mr. Danek pleaded guilty on September 6, 2022, in the Burlington Court House, to three counts of fraud over $5,000 under the Criminal Code, on behalf of himself and his company, 1898593 Ontario Inc. (the corporation).
A CRA investigation revealed that Mr. Danek provided transportation services to various companies in Ontario. Mr. Danek had registered four GST/HST accounts to his name as a sole proprietor, and had also created two GST/HST accounts for the corporation of which he was the sole owner and shareholder. Over a 57 month period, from January 1, 2011 to September 30, 2015, Mr. Danek made false statements on 169 GST/HST returns for his four sole proprietor accounts. Mr. Danek thereby unlawfully obtained or attempted to obtain $788,912 in GST/HST refunds.
Additionally, over a six-month period, from March 18, 2015 to September 30, 2015, Mr. Danek made false statements on 14 GST/HST returns filed for two GST/HST accounts belonging to the corporation, attempting to obtain $36,878 in GST/HST refunds.
In total, both Mr. Danek and the corporation obtained or attempted to obtain $825,790 in GST/HST refunds to which they were not entitled.
All case-specific information above was obtained from the court records.
Wilfully choosing not to follow Canada’s tax laws can result in serious consequences. Under the Income Tax Act and the Excise Tax Act, being convicted of tax evasion can include court ordered fines ranging from 50% to 200% of the evaded tax and up to five years in jail. Being convicted of tax fraud under Section 380 of the Criminal Code carries a sentence of up to 14 years in jail.
In addition to the 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 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.
The CRA has set up a free subscription service to help Canadians stay current on the CRA’s enforcement efforts.
Canada Revenue Agency
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