Antonio Accurso is as close to politics as it gets for a construction magnate, having hosted elected officials on his luxury yacht and overseen companies that worked on hundreds of millions of dollars in government contracts.
Mr. Accurso is not charged, but two of his companies are alleged to have defrauded Canadian taxpayers, according to Canada Revenue Agency charges filed on Monday. In court documents, the CRA said Simard-Beaudry Construction Inc. and Louisbourg Construction Ltd. evaded more than $4-million in taxes by claiming non-deductible expenses of $19-million between 2003 and 2008. The matter is expected to be heard on Tuesday in a court in Laval, Que., and the judge could force the companies to pay back up to $8-million to taxpayers.
Mr. Accurso was involved in a major controversy last year when the city of Montreal cancelled a $355-million water-meter contract after revelations that a senior city councillor was one of a number of officials who went yachting with him. As well, Mr. Accurso's close ties with Quebec labour unions and politicians are among the issues that have led to calls for a public inquiry into the construction industry in Quebec.
Premier Jean Charest's popularity has dropped to new lows over his refusal to launch an inquiry. He has said it is up to law-enforcement authorities to punish anyone involved in wrongdoing and has promised to create a permanent New-York-style anti-corruption unit.
The tax-evasion charges against Simard-Beaudry and Louisbourg will bring further attention to allegations that CRA insiders in Montreal helped several construction firms - including Mr. Accurso's - avoid paying millions of dollars in taxes. At least two team leaders in the agency's audit division have already been fired.
In search warrants executed in 2009 and 2010, the CRA and the RCMP alleged that employees of the tax-collection agency collaborated with middlemen who provided fake invoices and fraudulent research and development tax credits to companies.
The CRA said that between 2005 and 2007, three of Mr. Accurso's companies "funnelled close to $4.5-million" to two shell companies that were allegedly issuing fake invoices. Earlier this year, the CRA laid tax-evasion charges against Frank Bruno, owner of construction firm B.T. Céramique, accusing him of providing the fake invoices.
Court documents allege that when tax auditors started closing in on Mr. Bruno, one of his cousins, who worked for the CRA, proposed a "plan of action" to keep them at bay. According to the documents, Mr. Bruno opened a bank account containing $1.7-million in 2006 in the Bahamas with two CRA employees, including his cousin Adriano Furgiuele.
In addition, court documents filed earlier this year show the CRA rejected more than $1-million in R&D tax credits that Simard-Beaudry and Louisbourg claimed in previous years. A search warrant said that Mr. Furgiuele's brother, Marcello, was involved in the alleged scheme as the head of the Delvex Consulting Group.
Mr. Accurso was the administrator of both Louisbourg and Simard-Beaudry at the time of the alleged infractions, but provincial records show that his daughter, Lisa Accurso, recently replaced him. She is named in an RCMP search warrant that was executed earlier this year as having had discussions with Mr. Furgiuele at Delvex in relation to the allegedly fake R&D tax credits.
Overall, according to the CRA allegations, Louisbourg evaded $780,000 in taxes between 2005 and 2008, while Simard-Beaudry evaded $3.3-million in taxes from 2003 to 2008. Mr. Accurso said in a brief interview on Monday that he had no comment. Mr. Bruno's court case is before the courts.
In a statement, the CRA said that it is cracking down on tax evasion, especially in the Quebec construction industry.
"The CRA pursues tax evaders to maintain public confidence in the integrity of the tax system. In this regard, the CRA has set up an internal construction industry working group in Quebec that tackles non-compliance in this industry," the agency said.Companies of well-connected Quebec construction magnate accused of tax evasion with help from revenue agency insiders.
At a glance: Antonio Accurso, construction magnate
Companies: According to the Canada Revenue Agency, Mr. Accurso owned 80 per cent of Simard-Beaudry Construction Inc. as of 2008. The firm had revenues of $355-million in 2006, and $250-million the next year. Another one of Mr. Accurso's major companies, Constructions Louisbourg Ltd., had revenues of $143-million in 2007.
Charges: On Monday, the CRA laid charges of tax evasion against Louisbourg and Simard-Beaudry in relation to $19-million in non-deductible expenses that were claimed.
Position: Mr. Accurso was the administrator of the two companies at the time of the alleged incidents, but was recently succeeded by his daughter, Lisa Accurso.
Projects: Mr. Accurso's companies have earned hundreds of millions of dollars in contracts from governments, building roads, sewers and overpasses, among other things. The companies are especially active in Montreal and the surrounding area. SF invested in his projects... Mr. Accurso was involved in over $100-million worth of projects with investments from the Solidarity Fund, a financial institution owned by the province's main labour union, the Quebec Federation of Labour.
Controversy: Mr. Accurso made headlines last year when the City of Montreal scrapped a $355-million water-meter contract over cost concerns and allegations of favouritism. Mr. Accurso was one of two major players in GÉNIeau, the consortium that was supposed to handle the contract.
Yacht: Called the Touch, Mr. Accurso's luxury boat quickly became the symbol of his close ties with senior members of the labour movement and municipal governments, who vacationed with him in places like the Caribbean.