Court File and Parties
COURT OF APPEAL FOR ONTARIO
Sharpe, Simmons and Epstein JJ.A.
BETWEEN
Her Majesty the Queen
Respondent
And
Riccardo Di Giuseppe
Appellant
Counsel: Gregory Lafontaine and Joseph Di Luca, for the appellant Nicholas Devlin, for the respondent
Heard and released orally: January 25, 2010
On appeal from the conviction entered on August 27, 2007 and the sentence imposed on March 19, 2008 by Justice P. Tetley of the Ontario Court of Justice.
ENDORSEMENT
[1]
Appeal from Conviction
The appellant appeals his conviction for fraud. The charge alleged that the appellant, by deceit, falsehood or other fraudulent means, defrauded the public of income tax and G.S.T. payments owing by three corporations to Her Majesty the Queen by causing the companies to fail to report taxable income and supplies.
2The trial judge gave carefully considered, comprehensive and cogent reasons for conviction at the conclusion of what undoubtedly was a protracted and difficult trial. The trial judge summarized his essential findings at para. 315 of his reasons for conviction:
Based on the foregoing considerations, a review of the entirety of the trial record and application of the criminal standard of proof beyond a reasonable doubt, I conclude the evidence presented establishes the following:
Through the operation of Treesann Management Inc. from March 1, 1997 to February 28, 1999 and the operation of 1038345 and later 1246434 Ontario Limited from October 1, 1996 through October 31, 1998 the accused controlled Bunnies and Fantasia.
During the specified time frames referenced in the information Bunnies and Fantasia generated taxable income and taxable supplies subject to G.S.T.
Income tax returns were not filed by the named corporations and tax owing was not paid. I conclude the non-filing of the T2 corporate tax return was a consequence of the accused’s deliberate inaction. As an action oriented manager with a penchant for detail, I conclude, there is no justification for non-filing in spite of the various intervening circumstances referenced by the defence. Further, on the basis of the totality of evidence presented here the Crown has established, on the basis of proof beyond a reasonable doubt, that any subsequently filed T2 return would have been founded on fraudulent income data. Given the fact the accused never subsequently revealed the true state of his economic affairs to his own financial controller, the individual who would have prepared source financial information for filing purposes, the only available inference is that the accused’s intention to deceive continued long past the events of September 10, 1998.
The accused intentionally used deceit, falsehood and other fraudulent means to place the public economic interest at risk by intentionally directing the diversion of revenue for the purpose of ultimately undervaluing the taxable income of the named corporations.
The public economic interest was placed at risk by the accused’s making of false G.S.T. filings, failure to file G.S.T. returns and failing to file T2 Income Tax returns.
The intentional dishonest acts of the accused to conceal and divert significant revenues constitute acts of dishonestly and deception designed to defraud the public of income taxes and services net taxes in the amount of at least $3,492,415 rightfully due and owing to Her Majesty the Queen in Right of Canada. [Emphasis added]
3The appellant submits that these findings do not constitute fraud because no false or fraudulent document or return was uttered and no deceit was actually practised by the appellant. We disagree.
4First, the appellant did cause the corporations he controlled to file false G.S.T. returns.
5Second, as the trial judge found, R. v. Olan, Hudson and Hartnett (1978), 1978 CanLII 9 (SCC), 41 C.C.C. (2d) 145 (S.C.C.) and R. v. Theroux (1993), 1993 CanLII 134 (SCC), 79 C.C.C. (3d) 449 (S.C.C.) establish that the element of deprivation is made out by proof of detriment, prejudice or risk of prejudice to the economic interest of the victim caused by the dishonest act. While no income tax returns were filed, the appellant’s dishonest acts in creating false records and destroying records and in deliberately failing to file returns made it impossible for the corporations to comply with their legal duty to file income tax returns. The dishonest acts of the appellant imperilled the public purse and caused a significant risk of deprivation that constitutes fraud as defined by R. v. Olan and R. v. Theroux.
6Third, we see no merit in the submission that the count was improperly framed as a fraud on “the public”, particularly when the portion of the charge containing those words is read as a whole: “defraud the public of income taxes and goods and services net taxes owing to Her Majesty the Queen in Right of Canada”.
7Finally, the argument relating to 1038345 Ontario Limited advanced in the factum, was not advanced at trial, was not pursued in oral argument and, in any event, we see no merit in it.
[8]
Appeal from Sentence
The appellant also seeks leave to appeal his sentence of six years imprisonment and a fine of $2,000,000 with one year additional in default of payment. This was a very significant fraud involving over $3,000,000. The sentence was not outside the acceptable range and the trial judge’s reasons reveal no error of principle.
[9]
Disposition
Accordingly, the appeal against conviction is dismissed, leave to appeal sentence is granted but the appeal against sentence is dismissed.
“Robert J. Sharpe J.A.”
“Janet Simmons J.A.”
“G.J. Epstein J.A.”
