A Chilliwack woman who was part of an elaborate tax cheat ring masquerading as a school is wanted by authorities after she did not show up to her BC Appeal Court hearing.
Debbie Arlene Anderson filed for an a appeal of her 4.5-year jail sentence and her $35,000 fine issued in BC Supreme Court in March 2018. She was due in court for that hearing on April 17 but she did not show up.
“The Crown made an application to dismiss Debbie Anderson’s conviction appeal for want of prosecution and failure to comply with the rules,” Federal Crown Counsel Suzanne Manery explained via email. “Ms. Anderson was not present on that date. The Court granted the Crown’s application and Ms. Anderson’s conviction appeal was dismissed. Her sentence appeal remains outstanding. A warrant was issued for her arrest.”
Anderson earned at least $165,000 over 2005, 2006 and 2007, and declared zero income for the first two years and did not file an income tax return for 2007.
She was convicted on Nov. 3, 2017 of tax evasion and making false statements under the Income Tax Act (ITA), failure to make GST payments under the Excise Tax Act (ETA), and counselling others to commit fraud under the criminal code.
As part of Paradigm Education Group under the leadership of Russell Porisky, which taught the “natural person” theory, Anderson was said to have approximately 100 students who paid seven per cent of their income in order to arrange their affairs to pay no income tax or GST. In all, Paradigm was said to have 800 students.
The basis of the scam is the fraudulent teaching that, basically, income tax is optional. The fraud has been rejected by courts over and over, yet Anderson has been one of the strongest advocates and refused to accept the ruling against her when it first happened.
Anderson’s sentencing hearing back in March 2018 turned odd as the then 59-year-old did not enter submissions, but continued to argue her case and perpetuate the debunked Paradigm scheme.
Anderson asked that Justice Neill Brown recuse himself and have the case transferred to a clan grandmother of the Métis nation. Brown denied the request, and even pointed out the clan grandmother in question is herself in a conflict with the Canada Revenue Agency.
Anderson’s arguments went from odd to odder during her sentencing hearing. She claimed that Crown’s argument that a person cannot “contract out” of paying taxes made no sense because she never contracted in.
“It would be like Walmart dragging me in to shop there,” she said.
Justice Brown politely explained how incorporation works, even beyond private business and with levels of government such as Canada.
Anderson also argued the entire matter was unfair and that she was “impecunious” – essentially, broke.
“I’m the only one in here not being paid,” she said looking around the courtroom.
As Brown read his sentencing decision that followed Crown’s submission of 54 months in jail and the $35,000 fine, he said Anderson was only slightly less culpable than Porisky.
While it’s hard to nail down exactly how much the collective fraud cost taxpayers, about $11.5 million is the estimate.
As aggravating factors in sentencing, Brown pointed to the real need for specific deterrence as Anderson has not expressed any remorse or admitted her harm by not paying taxes, or the harm to her students by defrauding them, many of whom have also received sentences.
In a statement issued a day after the sentence last March, the CRA warned Canadians to beware of “tax protesters” who try to convince people that income tax is optional.
“Canadian courts have repeatedly and consistently rejected arguments made in these tax protester schemes,” the statement said. “For those involved in tax protester schemes, the CRA will reassess income tax and interest, and charge penalties. In addition, if convicted of tax evasion, the court may fine them up to 200 per cent of the tax evaded and sentence them for up to a five-year jail term. More information on tax protester schemes is available at Canada.ca/tax-alert.”