Canadian Brokerage Firm Linked to Offshore Accounts

According to a report in the December 14, 2009 The Globe and Mail, the Canada Revenue Agency (CRA) is investigating the involvement of staff from RBC Dominion Securities in implementing a plan to help Canadian clients avoid income tax by moving assets from Canada into Liechtenstein, a noted tax haven.

According to the report, the staff created a Liechtenstein Foundation, which held the Canadian client’s assets. Since the Foundation owned the assets, the Canadian clients sought to avoid including any income or capital gains on their income tax returns.

It appears that CRA’s investigation was instigated by information provided by Heinrich Kieber. In 2008, Mr. Kieber sold confidential information to the German government regarding accounts with Liechtenstein Bank LGT. This information has been used by tax authorities from around the world as they seek to reduce revenue losses from tax evasion.

Given the experience of account holders with Swiss Bank UBS over the summer, it is likely that this story is the first of many more to come.