Posts Tagged charity
Charity loses status over tax-shelter scam CRA says area group took in $2.8 million, but spent just $282,000
The Canada Revenue Agency has stripped an Ottawa-area charity of its charitable status after a damning two-year audit showed it was a front for a tax shelter scam offering big receipts for small donations.
The CRA ruling found that Healing and Assistance Not Dependence Canada expended a “proportionally negligible amount” of its income on charitable activities, making it ineligible to grant tax receipts.
The law says a charity must act exclusively for a charitable purpose to give tax receipts.
The charity purports to “encourage and assist and serve alcoholics, chemically dependent persons and their families, friends and associates primarily, but not exclusively within the Jewish community.” It has no website and no listing in the Yellow Pages.
Tax shelters allow people to avoid paying income tax. Tax-free savings accounts and RRSPs are examples of legal tax shelters.
Illegal, so-called aggressive shelters promise inflated tax receipts for nominal donations.
A company might ask you for a donation of $100 and promise you a tax receipt for $1,000. The company might claim your money is buying bulk supplies that,
if purchased individually, would be worth $1,000.
Aggressive tax shelters essentially sell receipts, pocketing the donations and bilking the federal government out of millions.
CRA spokeswoman Caitline Workman said tax receipts can be revoked if the government believes the donor should have realized the return was too good to be true, however, she would not say if the agency would revoke receipts donated to Healing and Assistance Not Dependence Canada.
The CRA audit, which took place between Sept. 1, 2006, and Aug. 31, 2008, showed the charity received almost $2.8 million from the Canadian International Aid Program, a registered tax shelter fronted by the Canadian Organization for International Philanthropy (COIP). Healing and Assistance Not Dependence Canada transferred 70 per cent of the money it received to other participants in the scheme, keeping $900,000 for itself. Of this, only $282,000 was devoted to charitable programs.
Even this figure is doubtful. Healing and Assistance Not Dependence Canada claimed to contract out its treatment services to American and Swiss treatment centres, but the CRA found there were no descriptions of how programs were to be delivered on the charity’s behalf.
The auditor wrote “the charity did not, in fact, deliver any of the charitable addiction counselling, treatment, or education programs for which it was ostensibly raising funds.
The CRA also found that 79 per cent of the charity’s income was spent on fundraising, which far exceeds the “reasonable” amount proscribed by law.
The true purpose of the charity, said the CRA, was to receive and transfer donations on behalf of the tax shelter program.
The money the charity funnelled out landed in questionable pockets. Almost $2 million was transferred to the Orion Foundation and PanAggregate Financial Corporation. Orion was the subject of an investigation by the Toronto Star, which found that its head, James Arion (who has gone by many other names), was giving $2,000 tax receipts for $1,000 donations. The CRA is challenging many of those receipts.
The Star showed the Orion Foundation is also connected to the Canadian International Aid Program and COIP, which claims to provide AIDS drugs to infected Africans.
No one from Orion, PanAggregate or COIP would provide comment to the Citizen.
http://www.ottawacitizen.com/business/fp/Charity+loses+status+over+shelter+scam/1675746/story.html
Reviewed by Moishe Alexander
Moishe Alexander Donates to United Chesed
In 2008, Moishe Alexander donated $1,700.00 CDN to United Chesed of Toronto and Vicinity (http://www.unitedchesed.com).
About United Chesed:
Providing emergency rapid support, to families and individuals requiring food, clothing, shelter, medical, financial, and social support both directly and through a vast networking system.
United Chesed is a registered not-for-profit charity organization, that is unique. We provide emergency rapid response, with and average of 24 hour turn over time, to those requiring food, clothing, shelter, financial and social assistance.
We are dedicated to fulfilling the needs of the growing numbers of Jewish families living in poverty in Toronto and the GTA.
United Chesed assists individuals and families on a short-term basis until they are able to provide for themselves or other agencies in our network take over.
Our Future Vision
* To create a unified body which will serve the Jewish community with all its resources for the benefit and maintenance of the Jewish residents of Toronto and its suburbs.
* To establish and maintain an active network of communications between synagogues, as a result of which various aspects of Chesed can be obtained.
* To enhance and create a climate of Sholom Bayis with all the involved parties for the well-being and stability of the Jewish community in Toronto and be an example for other communities in North America.
United Chesed of Greater Toronto is the brainchild of Thornhill Dentist, Dr. Brian (Baruch) Price. Dr. Price, implemented his vision to establish an umbrella organization, to serve the impoverished Jews in the GTA regardless of affiliation. The organization was developed to serve two purposes, provide basic needs to people and act as a support network, able to connect individual with vital resources in the community.
For the past seven years, through its one stop referral service and working with the representatives from many organizations, United Chesed has helped thousands of individuals in desperate need of food, shelter, clothing, medical and social assistance.
November 12, 2005, Dr. Price and his team organized their first community awareness and networking event at the North York Civic Centre. The Keynote speaker, Mr. Paul Godfrey, CEO of the Toronto Blue Jays, said “he was impressed with United Chesed’s mandate to unify Jewish charities to educate the community. It is with great hope and faith in the ENTIRE community that United Chesed firmly believes that no child, adult or elderly individual will be without bread on their table.”
Moishe Alexander Supports KH Meoroth Charity
Moishe Alexander donated $2,846.00 CDN to KH Meoroth in 2008.
KH Meoroth is an umbrella charity that provides financial support for the poor, in addition to programs that include assistance for children with Cystic Fibrosis (CF).