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Thrill is gone from offshore tax evasion Add to ...

Canada has undergone a moral transformation when it comes to offshore tax evasion, and what may have been considered exotic is no longer tolerated by the average taxpayer, the Minister of National Revenue said yesterday.

"At a certain period of time in this country, and I may say a few years ago, it's like it was excellent to not pay your taxes," Jean-Pierre Blackburn said. "It's like it was, 'Oh, you're a lucky person,' - seeing it as good. But it's not like that any more. People, they don't like to see anyone cheating."

It was the minister's first comments on a probe into clients of RBC Dominion Securities who are alleged to have concealed savings in the tiny European principality of Liechtenstein.

"I want to work seriously on this question. I think you have to be fair to Canadians. We have a deficit this year of $56-billion. People have to pay their due to the government," he said.

It was publicly revealed yesterday in a joint Globe and Mail-CBC report that auditors have alleged in federal court that at least three investment advisers with RBC Dominion "assisted Canadian taxpayers in establishing Liechtenstein entities for the purpose of hiding investments and other income."

The agency has launched about a dozen audits into clients of the firm's branch in Victoria, B.C. Among them are a former British Columbia provincial politician, a former Alberta mayor and three lawyers. One of the former RBC Dominion officials who advised most of the clients, Colin M. Ross, has also been the subject of an audit as "a promoter," according to a sworn affidavit filed in court.

But while Mr. Blackburn said recovering unreported money is a priority, there are some things he isn't willing to do. Chief among them is paying for information, he said.

"This is not the way we work. We try to obtain information. We try to have new treaties with countries. We try to work with the G20 to be sure that bank secrecy won't stay," he said.

His strategy stands in contrast to other Western countries that were the first to start prying open the world of tax havens - and along the way, helped Canada obtain the secret records that launched the Vancouver Island probes.

The agency has acknowledged that it was tipped off about the Liechtenstein accounts because of one man - Heinrich Kieber, a document scanner with a division of one of Liechtenstein's largest banks, LGT. In 2006, Mr. Kieber sold thousands of pages of client data to the German intelligence service for more than $6-million.

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