Gold: Kitco Accused of Massive Tax Fraud

Canada's Revenu Quebec has named two companies publicly as being the subject of its investigations – Kitco Metals Inc. and Carmen International Inc. but says 125 are involved.
Kitco denies the allegations.

Financial Post reports: "Revenu Quebec has initiated a massive series of searches and seizures in the Montreal area, alleging that companies and individuals in the gold refining and trading industry engaged in widespread tax fraud on transactions worth $1.8-billion.

More than 175 government investigators conducted the sweep this week, targeting businesses, residences, accountant offices and bankruptcy trustees. Some 125 companies are complicit in the scheme that bilked the government of more than $150-million worth of taxes, Revenu Quebec asserts. No arrests have so far been announced".
“Revenu Quebec has a duty to be intransigent with those who contravene financial rules and can begin legal proceedings against them,” the department said in a statement. The maximum prison term for anyone found guilty in relation to tax evasion is five years, it said.

"The six-step fraud involved companies using artificial transactions to obtain refunds of taxes that were never actually paid as gold was turned into scrap and then refined back into its pure state.
The company won court approval to appoint an interim receiver, RSM Richter, to help it deal with the allegations. Its daily operations are continuing as they normally do, said company spokesperson Sharlene Dozois".

“We appointed the receiver to protect the interest of everyone and have someone work with us through the process,” Ms. Dozois said. “We did that voluntarily.”