January 20, 2014
By Kevin Weedmark
Gerald Blerot, age 60, of Moosomin has been convicted in Saskatchewan Court of Queen’s Bench of tax evasion and counselling others to evade taxes.
Sentencing has been scheduled for March 10, 2014.
Blerot will remain in custody in Regina until his sentencing hearing.
Being remanded in custody is unusual in tax evasion cases, but Blerot, previously from the Storthoaks district, has a long history of problems with the law, including contempt of court and assault, and with securities regulators.
Blerot’s run-ins with the law began almost two decades ago, with his involvement with a group known as Farmers for Justice, which was fighting against the Canadian Wheat Board’s monopoly on the sale of Western Canadian wheat, and attempted to sell wheat directly into the United States.
In 1996, Blerot attempted to make citizen’s arrests on Canada Customs officers, claiming they were guilty of extortion for impounding the vehicles of Farmers for Justice members trying to sell wheat outside the authority of the Canadian Wheat Board, and charging fines before returning the vehicles.
In 1997, Blerot was the subject of a Court of Queen’s Bench of Manitoba injunction against acting as counsel in any Manitoba proceeding. Blerot was accused of providing incorrect legal advice to farmers.
Blerot was convicted of assault after a 1998 incident in which he entered a semi-secure area at the Saskatchewan legislature, and grabbed and held the province’s justice minister, John Nilson, until the minister and security guards could wrest him away.
He was held by the province’s sergeant-at-arms before being arrested by Regina city police at the Legislature.
In defending himself against that charge, Blerot argued that the information against him was invalid because his name was spelled in all capital letters, while his birth certificate was not. According to the judgement in the case, “The accused’s name is typed in small letters on his birth certificate but completely in capital letters on his driver’s licence, and the information charging the offence before the court. As the court understands the accused’s position, he feels we have the wrong person and the information is not valid. The court can reject this position outright as having no basis in law whatsoever.”
He was convicted of assault. Blerot appealed the conviction, claiming that the prosecution was invalid because the courtroom where it was heard had been changed from courtroom 1 to courtroom 5.
The appeal was dismissed.
In 1999, Blerot was involved in a dispute over how interest should be calculated on a farm loan taken out by himself and his wife, Vivianne.
The decision went against him. “I find that the principles advanced by the statement of defence are unworthy of further consideration and I direct that the statement of defence be struck and that the registrar be relieved of the further obligation to conduct an inquiry. The statement of defence is therefore struck out on the ground that it discloses no reasonable defence and the plaintiff shall be entitled to enter judgment in accordance with its claim,” the judge wrote.
In 2003, the government of Manitoba shut down several businesses Blerot was involved in which claimed to offer investments in a “tax free environment.”
In 2006, the Saskatchewan Financial Services Commission issued a cease trade order against Blerot, Plain Investments Inc. and Executive Marketing and Strategies Ltd.
The company, which also had partners in Alberta, was buying and reselling game and concert tickets.
According to the Canadian Securities Administrators, in a report on the case, “In cases of illegal distribution, investors are often promised guarantees of an investment. In the Executive Marketing Strategies case in Alberta, for example, investors were promised ‘highly attractive’ returns of as much as 18 per cent per quarter to invest in an event ticket business. The respondents in EMS raised approximately $10 million from over 300 investors by selling them loan agreements in which money would be lent to ticket brokers for the purchase of large blocks of event tickets. An Alberta Securities Commission panel found that EMS failed to demonstrate all of the money raised through the loan agreements was used for this purpose, and that the respondents personally benefited from the money received by EMS.”
The ASC panel ordered a total of $490,000 in administrative penalties.
Blerot’s latest conviction comes as a result of Blerot counselling others not to pay income tax.
Earlier this year, an Estevan company, Jake’s Oilfield, and an Estevan man, Jerry McCaw, were found guilty of not filing $548,044 in taxable income, and evading $114,924 in federal income taxes.
McCaw was paying $595 per month to Blerot, who is alleged to have advised McCaw and others that they do not have to pay income tax.
Evidence provided to the court showed that Blerot, an “educator” with the Paradigm Education Group operated by Russell Porisky, adopted Paradigm’s beliefs to allege that, as a “natural person,” he was not subject to the Income Tax Act and that he took no action to seek out reputable professional advice regarding these beliefs. The court heard that Blerot knowingly evaded taxes and was also acting as an “educator” aiding, abetting and counselling others to commit tax evasion.
Porisky was convicted in the Supreme Court of British Columbia on January 18, 2013 of tax evasion and counselling others to commit tax evasion.
The Canada Revenue Agency warns all Canadians to beware of individuals that try to convince you that Canadians do not have to pay tax on the income they earn.
These individuals, also known as tax protesters, not only fail to report their own earnings, but they also conspire, counsel, and promote these tax schemes.
Canadian courts have repeatedly and consistently rejected all arguments made in these tax protester schemes.
For those involved in tax protester schemes, the CRA will reassess income tax and interest, and charge penalties.
In some cases, these individuals will be prosecuted for tax evasion.
If convicted, they could face significant fines and possibly jail time.
When individuals are convicted of income tax and GST evasion, they must still repay the full amount of taxes owing, plus interest and any civil penalties that may be assessed by the CRA. In addition, the court may fine them up to 200 per cent of the taxes evaded and impose a jail term of up to five years.
Taxpayers who have not filed returns for previous years, or who have not reported all of their income, can still voluntarily correct their tax affairs.
They may not be penalized or prosecuted if they make a valid disclosure before they become aware of any compliance action being initiated by the CRA against them.
These taxpayers may only have to pay the taxes owing, plus interest.