According to an international expose, Canadian Prime Minister Justin Trudeau’s principle fundraiser was part of a tax dodge in the Cayman Islands. As CBC News reports, The “Paradise Papers,” an international investigative journalism effort, suggest that Seagram’s Whiskey heir and billionaire Stephen Bronfman used his Montreal investment firm Claridge Inc. to allegedly bypass Canadian taxes through a tax-free Cayman Island trust fund.
CBC News was responsible for much of the expose relating to Canadian politics as it worked with the International Consortium of Investigative Journalists.
Bronfman raised millions for Trudeau’s campaign as the revenue chairman of the Liberal Party of Canada. The Bronfman family has long been friendly with the current prime minister and his father, Pierre Trudeau, who led Canada for 15 years.
The suggestions of tax evasion are especially damaging to the Trudeau government because in the last election, the campaign ran on a platform that included a pledge to make the rich pay their “fair share of taxes” under the Liberals. Trudeau has also been attacked by the Conservative opposition and business groups for the past two months for tax proposals that critics say will hurt small businesses.
The Canada Revenue Agency has already issued a statement indicating that it will take note of any evidence of tax evasion and take “appropriate action” if necessary.
A parallel investigation conducted by CBC and the Toronto Star also demonstrates that Bronfman’s law firm resisted any efforts by the federal government to stop the loss of tax revenue through individual and corporate use of tax havens.
At least one American expert is suggesting the massive haul of data should provoke a formal investigation. “I would say there are lots of red flags, and I would expect tax authorities specifically to be very interested in following up,” University of Florida trust law professor Grayson McCouch told CBC News after studying the documents for 48 hours.
The Kolber Trust is the focus of the documents relating to the Cayman Islands and Bronfman’s financial dealings. The trust was established in 1991 by Leo Kolber, who was not only the chairman of Bronfman’s Claridge investment firm but a Liberal senator and party fundraiser as well. Monies divested from that trust will most likely be the subject of any tax fraud investigation.
