Halifax businessman sentenced to 3 years in prison, $600K in fines for tax evasion, fraud

A Halifax businessman has been sentenced to three years in prison and must pay more than $600,000 in fines after being convictedof fraudand tax evasion.

Ralston MacDonnelland three of his companies were found guilty of seven counts of fraud and four counts of taxevasionby a Halifax provincial court judge in May, according to a news release from the Canada Revenue Agency.

The news release said an investigation revealed that MacDonnellhad been operatingan engineering firm in Halifax that had splintered into three companies:MacDonnell Security Risk Management Ltd., MacDonnell Group of Canada Ltd.and 3182552 Nova Scotia Limited.

Between 2009 and 2014, MacDonnell collected goods and services tax, harmonized sales tax and payroll source deductions from his three businessesbut failed to remit them to the CRA.

"MacDonnell made several false and deceptive statements in dealings with the CRA, which included the evasion of requirements to pay and the withholding of information," the release said.

"MacDonnell also used cheques knowing that they were drawn from an account that had insufficient funds."

During the same five-year period, MacDonnell also diverted corporate funds into personal bank accounts unknown to the CRA to cover personal expenses, including three mortgages anda car lease.

From Jan. 1, 2009 to Dec. 31, 2014, MacDonnelldefrauded the federal government$961,700.55.

MacDonnell was fined$301,511.25, while his companies were fined$301,516.25, for a combined total of $603,027.50.

The businessman will also have to pay the full amount of tax owing, plus related interest and any penalties assessed by the CRA.