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Lottery winner evaded taxes, fined $375,000

Jan 12, 2005, 8:54 am

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Canada Super 7Canada Super 7: Lottery winner evaded taxes, fined $375,000

Jefferson, 71, won $12.5 million; admits to making out false invoices

The winner of a CDN$12.5 million lottery prize who runs a benefit plan consulting firm is a little less rich today after admitting he fabricated expense claims and service invoices involving his business.

Walter Jefferson, chief executive officer of Toronto-based Global Benefit Plan Consultants, pleaded guilty to five counts of income tax evasion in court this week and paid a fine of $375,000.

Jefferson, 71, did not report income totaling $646,712 on his 1996 to 2000 tax returns, according to an agreed statement of facts.

He received that money while serving as a director and officer at Global and a related firm, Canadian Benefit Consulting Group Inc.

Jefferson admitted he evaded $187,547 over the five-year period, the statement says.

The court fine represents almost twice the amount of the evaded federal tax.

Jefferson hit the front pages of newspapers two years later in July 2002, when he won $12.5 million in the Lotto Super 7.

The plea and fine followed a Canada Revenue Agency investigation that found he misappropriated funds from the two companies for his own use by submitting phony expense claims and service invoices.

Jefferson admitted he knowingly misappropriated client referral commissions, including the goods and services tax that Global earned from Morrison Williams Investment Management Inc.

Jefferson, who lives in Caledon, was responsible for creating false invoices reflecting consulting services that he never conducted and sent them to Morrison Williams, which issued checks to him, according to the statement of facts.

Furthermore, the statement said Jefferson submitted false expenses, including the GST, to Canadian Benefit Consulting Group for travel and promotion. Jefferson created misleading credit-card charge slips or vendor-sales invoices to reflect costs that he allegedly incurred, the statement added.

It also noted Jefferson claimed several expenditures twice.

For example, Jefferson filed charges from his own credit card accounts to Canadian and then again through submissions of vendor sales invoices for reimbursement to him.

Global provides administrative services for numerous employer benefit and pension plans and offers consulting assistance to companies and institutions, including universities.

Jefferson's lottery jackpot in 2002 followed a hot streak at Woodbine Racetrack, where he had won $20,500 a few days earlier.

At the time of the jackpot, Jefferson was quoted as saying that he had no plans to retire as chief executive officer from Global and his "family" of 62 employees.

Jefferson, who formed Global more than a quarter century ago, said he grew up in foster homes and slept under porches, and wanted to share his new wealth.

He could not be reached for comment last night.

An assistant said Jefferson was still chief executive of Global but would not confirm if he still heads Canadian.

Toronto Star

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1 comment. Last comment 17 years ago by CASH Only.
Page 1 of 1

United States
Member #379
June 5, 2002
11296 Posts

At least his lottery win was tax-free.