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The CRA has revoked the registration of The Life Centre Word of Faith Ministries Inc. as a charity. The Globe and Mail covered this story in “Toronto pastor, wife charged in alleged $8.6-million Ponzi scheme” http://soa.li/mVtmmlY
Here is the CRA press release:
“The Canada Revenue Agency revokes the registration of The Life Centre Word of Faith Ministries Inc. as a charity
Ottawa, Ontario, May 3, 2013. . .
The Canada Revenue Agency (CRA) will revoke the registration of The Life Centre Word of Faith Ministries Inc., a Toronto-based charity. The notice of revocation will be published in the Canada Gazette with an effective date of May 4, 2013.
On March 25, 2013, and in accordance with subsection 168(1) of the Income Tax Act, the CRA issued a notice of intention to revoke the registration of The Life Centre Word of Faith Ministries Inc. as a charity. The letter stated, in part, that:
“The Canada Revenue Agency’s (CRA) audit has revealed that the Organization is not complying with the requirements of the Income Tax Act. In particular, it was found that the Organization failed to maintain adequate books and records to substantiate its reported revenue and expenditures, as well as to support its charitable activities. The audit revealed that the Organization’s resources were not devoted strictly to charitable activities, and were used to confer undue benefits on a director and his family. The Organization was found to have participated in a series of improper investments with corporations owned and operated by its Director, Mr. Marlon (Gary) Hibbert and his family.
During the course of the audit, Mr. Marlon (Gary) Hibbert was found by the Ontario Securities Commission (OSC) to have “perpetrated a fraud on investors contrary to subsection 126.1(b) of the Act [Securities Act R.S.O. 1990 c.S.5] and contrary to public interest; and Hibbert misled Staff contrary to subsection 122(1)(a) of the Act [Securities Act R.S.O. 1990 c.S.5] and contrary to public interest.” While we are not relying on the OSC decision as grounds for revocation, our audit findings are consistent with those of the OSC to the extent that Mr. Hibbert used the funds of the charity for his own private gain.”
A copy of the notice of intention to revoke and other letters relating to the grounds for revocation are available to the public on request, in the language they were originally written, by calling 1?800?267?2384.
An organization that has had its registration as a charity revoked can no longer issue donation receipts for income tax purposes and is no longer a qualified donee under the Income Tax Act. The organization is no longer exempt from income tax, unless it qualifies as a non-profit organization, and it may be subject to a tax equal to the full value of its remaining assets.
Registered charities perform valuable work in our communities, and Canadians support this work in many ways. The CRA regulates these organizations through the Income Tax Act and is committed to ensuring that they operate in compliance with the law. When a registered charity is found not to comply with its legal obligations, the CRA may revboke its registration under the Income Tax Act.
For more information about the registration of Canadian charities, go to the CRA’s Charities and Giving Web page at http://www.cra.gc.ca/charities.
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The Canada Revenue Agency has announced that it will revoke the registration of The Life Centre Word of Faith Ministries Inc., a Toronto-based charity. The revocation will come into effect on May 4, 2013.
Canada Revenue Agency
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Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.