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Results: 16 - 30 of 174
View Wayne Easter Profile
Lib. (PE)
Mr. Ste-Marie, the minister has the floor. I don't want to intervene here, but I would suggest that members go back and look at Mr. Gallivan's answer on section 231.4, in which he talked about what kind of inquiry that is under the act. I'd suggest members look at that comment. Look at section 231.4 in relation to the words Mr. Gallivan said earlier.
Mr. Julian.
View Peter Julian Profile
NDP (BC)
Thanks very much, Mr. Chair.
I think we probably have about 45 minutes. I believe that Mr. Ste-Marie wants to come back to an issue as well.
I've already circulated the motion and I'll read it for the record and then add an amendment just to facilitate things. This is following discussions with Mr. Sorbara. I move:
That the Committee request that the government initiate a public inquiry under the Income Tax Act—
I would add “or the Inquiries Act”.
—to investigate tax planning by KPMG, or any of its subsidiaries, in the Isle of Man, the possible involvement of the sword companies Shashqua, Katar, Sceax, Spatha and Parrhesia corporations, and to investigate tax fraud in the Cinar, Norshield and Mount Real cases and any possible links with the KPMG Isle of Man tax planning and/or Isle of Man's sword companies, and that this be reported to the House.
I'm adding “or the Inquiries Act” because that gives the government the scope to use either tool, and since there is some dispute around the use of the Income Tax Act, my interpretation—and I would certainly agree with Mr. Ste-Marie and Mr. Lareau on that—is that it gives the government a broader scope to use the tool that is most appropriate.
The most important thing here is that we know from the testimony we had from Janet Watson, from the really important journalism we've seen both with Enquête on Radio-Canada and also from The Fifth Estate on CBC that thousands of Canadians were defrauded. That money was taken overseas. We have a responsibility and we've undertaken to get to the bottom of it as much as we can, but to date, we have asked KPMG many questions and have received often evasive or incorrect responses or no responses at all.
Therefore, I believe that given what we know and that we all share an interest in getting to the bottom of this and we all share an interest in seeking justice for the victims of these colossal frauds—half a billion dollars, and people losing their life's savings. You can only imagine somebody who saved up, like Janet Watson did, $68,000 of her life savings and lost it all due to this fraud.
I believe we have a responsibility to pass this motion. Ultimately, it is a request, but it does seek justice for the victims, and I believe that's what every member of this committee wants to see as well.
Serge Bilodeau
View Serge Bilodeau Profile
Serge Bilodeau
2021-06-17 16:27
Yes, I'm here. I don't know for how long, because the IT guys have been trying to fix the problem for one hour and a half.
Serge Bilodeau
View Serge Bilodeau Profile
Serge Bilodeau
2021-06-17 16:29
I'm sorry, but I was told that you couldn't hear me. So I will continue.
Thank you for the invitation.
I am retired from KPMG. I was an associate in the Montreal office for 25 years, from 1987 to 2014. I was never in charge of the tax department or any other department at KPMG, either locally, provincially or nationally. I was a client service associate, not a manager.
In summary, I advised clients on Canadian and international tax matters. I was involved in developing and implementing foreign transactions, such as financial structures, like the so‑called double dipping, the repatriation of foreign profits, and foreign currency management.
I have also acted as an advisor in several mergers, acquisitions and corporate restructuring for both public and private companies.
In the course of my career, I have had numerous discussions with tax authorities to obtain advance rulings or during tax audits. The discussions sometimes concerned foreign operations. My role was to meet the needs of clients by applying tax laws with the highest standards of integrity, compliance and professionalism.
Like most professionals in Quebec, as a CPA, I am bound by professional secrecy regarding our clients and former clients. I will do my best to answer your questions in light of this confidentiality requirement.
However, I can confirm beyond any doubt that I was never involved, as an associate or otherwise in what has been called the Cinar affair. The first time I heard about this case was in the media. Unfortunately, fraud appears to have been involved. As a Canadian taxpayer and a tax professional, I strongly encourage this committee to shed light on the matter.
Today, I am an occasional consultant for KPMG and sit on a few boards of directors.
KPMG is a firm that, in my experience, always acts with integrity and in the best interests of Canadians.
I would like to clarify a few points in that sense.
With respect to the Isle of Man's foreign company structure—the so‑called OCS—I was not involved in its development. I became aware of the structure in the early 2000s, as did several other tax associates in the firm. I reviewed the analysis prepared by the firm's senior tax experts, as well as the two independent legal opinions. At the time, I felt that the structure was valid from a tax and legal perspective, as long as clients followed the advice provided. I personally participated in creating two of those structures. In one case, a third party company was responsible for implementing the structure, so my role was limited.
I also want to make it clear that I was not involved, as an associate or otherwise, in the shell companies named after swords or in Parrhesia. I understand that this may be of interest to you, because those companies were registered in the Isle of Man, but neither of them were associated with the two cases I worked on.
I would not be able to give you any information on that. [Technical difficulty] Ms. Iacovelli, who answered your questions on this subject when she appeared before the committee.
I will do my best to contribute to the discussion today.
View Pat Kelly Profile
CPC (AB)
When you were an employee at the Montreal office, your office did offer offshore products to your clients. That was something you did in the course of your work at KPMG in Montreal. You said you had two clients, or you were at least involved in offering offshore products on two occasions.
View Pat Kelly Profile
CPC (AB)
Okay.
I really want to know about the scope. I'll go a little further with the question just to ask about the scope of overseas products offered in the Montreal office when the witness was there. I think he said in his opening statement that on a couple of occasions, he'd been involved in that.
Can he comment? Was tax planning involving overseas products a common or widely used strategy in the Montreal office when he worked there?
Serge Bilodeau
View Serge Bilodeau Profile
Serge Bilodeau
2021-06-17 16:43
Actually, the product, what we call OCS planning, that is to say the foreign company structure, was offered on a national basis, not only in Montreal.
However, in terms of my responsibility to the clients, my involvement in both situations was from Montreal.
View Pat Kelly Profile
CPC (AB)
Okay, so what changed? When did your business stop offering overseas products and why?
Serge Bilodeau
View Serge Bilodeau Profile
Serge Bilodeau
2021-06-17 16:44
The planning was developed by a group of senior tax experts, led by a man named Barrie Philp, and it was developed on a national level. The analysis was done on a national level. Then it was explained locally, in each of the provinces. When the situation was appropriate, it was discussed with the client and, if they agreed, it was implemented.
View Pat Kelly Profile
CPC (AB)
I'm not sure that was an answer to my question. I wanted to know when.
Was there a date or a time period at which KPMG stopped offering overseas products? I think the earlier testimony suggested that there was a time at which KPMG ceased offering this kind of tax plan.
Serge Bilodeau
View Serge Bilodeau Profile
Serge Bilodeau
2021-06-17 16:45
KPMG did an overall assessment and stopped offering those products in 2002, 2003 or 2004. In fact, the decision was the firm's, not the local office in Montreal. That's why I hesitated. That decision was made by the firm on a national basis.
View Pat Kelly Profile
CPC (AB)
What was the rationale for that decision? Was there a change in the law?
Results: 16 - 30 of 174 | Page: 2 of 12

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