Adelchi DiPalma, a tax preparer, has been sentenced to 40 months in prison and fined a total of $1,134,309 in Ontario Superior Court of Justice for preparing false documentation for income tax returns of 109 clients. The fine represents 150% of the $756,272 in federal income taxes that DiPalma attempted to evade on behalf of his clients.

A CCRA investigation revealed that DiPalma prepared or provided financial statements reporting false business and investment losses in a non-existent gold mining investment in Guyana, South America for inclusion on the 1990 to 1993 income tax returns of 109 clients.

The fraudulent losses totaled $3,779,295, and thereby, resulted in the evasion of federal income taxes totalling $756,272.  The scheme involved creating, promoting and selling, either directly or indirectly, non-existent mining investments to the clients.  The CCRA reassessed the tax returns including the fraudulent documents and applied penalties, where applicable, to the clients.

Individuals and corporations that have not reported all of their income or who have not filed for previous years, can still voluntarily correct their tax affairs, says the CCRA, if they make a full disclosure before the CCRA starts any action or investigation against them.  They will not be penalized or prosecuted and will only have to pay the taxes owing plus the interest.