The Canada Revenue Agency’s policy is to not investigate tax fraud until the complainant has attempted to resolve the issue himself.
Have you ever seen reports about the billions of dollars owed in taxes that are not being collected by the CRA and thought ‘why don’t they do anything about this?’ Well, now we have the answer – an answer that is known to everyone who has contacted the CRA to report tax fraud: the CRA puts the onus of investigating tax fraud on the person reporting it!
Anybody calling the toll-free CRA phone number and is lucky enough, after navigating the menu and remaining on hold for hours, to be connected to a human being (although they identify themselves as ‘agents’, not as humans) and attempts to report tax fraud is in for a shock. CRA policy is to not take a report of fraud – unless the caller has already contacted the fraudster and demanded an explanation from them!
So, let’s say that the company you work at is committing millions of dollars of fraud, maybe siphoning money from your pension fund. You phone the CRA and the agent who answers asks if you have contacted your employer about this. “No,” you respond, “I have not. I am not an investigator, just an employee that happened to come across some documents.” “Well,” says CRA agent 9144-ONT, “our policy is that you first contact your employer and try to sort this out yourself. If, after you have done this and you haven’t been able to sort this out, then call back.”
At first blush this seems reasonable, but a few seconds of ‘thinking’ reveals the potential consequences of such an action. Every single day for the past 5000+ years people get murdered because of money. Every single day people are murdered because they threaten to expose criminal activity that could send people to jail. Is the mafia involved in this fraud in your company? Do you want to find out if they are? Certainly, your job is at stake if you threaten to expose millions of dollars in fraud. Maybe your life too. This is like the police telling you to try to stop a bank robbery before calling 911.
You: Hello boss, I just noticed that there is millions of dollars in fraud occurring. Here is all my evidence.
Your boss: Wow. Just give me a minute here and let me take a look. … OK, this looks very serious, but I just (pretended to have) talked to the accounting department and they told me it was a computer error. We have fixed everything now. Thanks again. Goodbye.
You: Um …
You then call back the CRA and tell them about the conversation. “So the problem is resolved?” asks the CRA agent.
“Well, they said it was a computer error but – “ you try to say.
“And they fixed the computer error?”
“They say they have,” you say.
“So then the problem is resolved. Thanks for calling and remaining on hold for an hour. Goodbye.”
Meanwhile back at your workplace:
Your boss: Yeah, hello Ivan in accounting? We almost got exposed but it’s OK. I’ve taken care of it. I just talked to HR and made sure the troublemaker won’t be coming into work again. Maybe you can make some calls to your friends to ‘take care’ of the problem. I hear he is ‘suicidal’ and is suffering from ‘health problems.’
Ivan in accounting: Da, no problemski.
You may be thinking that it is unlikely that the Russian mafia is involved in laundering millions of dollars through Canadian companies. But is it? Nobody knows until an investigation is done, but the CRA is afraid to investigate. And how many people, after being blown off by both their employer and the CRA, are willing or able to force the issue? How many people are willing to even bring the issue up with their employer in the first place. By doing so you are losing your anonymity and putting yourself in danger of losing your job – or worse. The CRA is literally putting the lives and livelihoods of whistleblowers in danger. How many people have lost their jobs because of this policy? How many people have been killed? How much fraud is going unreported? We will never know.
Why does the CRA do this? Because they are stupid and lazy. Either that, or they are in on it.
Dimitry Oligarchski: I hear we have problem.
Your boss: <sweating profusely> No, no problem. It’s all sorted.
D.O.: It better be. I had to call Chinese to get North Korean hackers to stop. The Ayatollah is not happyski. This will not happen again?
Your boss: No.
Your boss: No, sir.