Thornhill man at middle of alleged $131M tax scam

The Canadian Revenue Agency (CRA) recently revoked the charitable registration of two Markham area charities it said were being operated for the private benefit of its directors. The president of these organizations is Thornhill resident David Singh.

In two separately published reports, the CRA concluded that Destiny Health and Wellness Foundation and Liberty Wellness Initiative issued tax receipts greatly exceeding actual received donations. According to the agency, between 2005 and 2006, Destiny Health and Wellness Foundation issued in excess of $42 million in receipts for cash received through the Universal Donation program and through the Destiny Gifting program.

The overwhelming majority of these funds, the report claimed, were transferred to company employees and an investment company. Similarily, between 2004 and 2006, Liberty Wellness Initiative issued nearly $89 million in receipts, five times the actual value of donations, the release stated.

“It is our position that [the organization] has operated for the non-charitable purpose of promoting tax shelter arrangements and for the private benefit of its directors and the tax shelter promoters,” concluded the CRA in each report. In a March letter, Cathy Hawara, director general of the charities doctorate for the CRA, wrote that “these arrangements have resulted in substantially all of the actual cash received being diverted into the hands of the promoters and related companies rather than used for charitable purpose.”

The reports also stated that each charity had issued receipts for transactions that did not qualify as gifts, issued receipts contrary to the Income Tax Act and failed to meet annual disbursement quotas. In a prepared release, Singh described a 42-page response sent to the CRA in May 2009 “refuting each and every allegation put forward.”

“Liberty Wellness Initiatives and Destiny Health and Wellness Foundation are each challenging the actions of CRA through Notices of Objection as set out in the Income Tax Act,” the release added. “In due course, once our legal team and CRA have successfully resolved the matter, we will be positioned to provide any futher information you may require.”

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