In April 2016, Raymond Mahoney of Stephenville took to the media to warn the public of an income tax-related scam.
He contacted the Western Star and provided the newspaper with an audio recording of a phone scammer alleging to be a representative of the Canada Revenue Agency and trying to extort money.
“My goal was to collect this recording to let the public hear how these things go,” Mahoney said at the time.
Thursday morning, Mahoney was sentenced by a provincial court judge in St. John’s to jail time for running an income tax scheme of his own, fraudulently earning himself and others thousands of dollars.
Mahoney, 34, was facing a charge of fraud over $5,000 as well as 28 charges of making a false statement on a tax return under the Income Tax Act. When he pleaded guilty to the fraud and two of the other charges, the Crown withdrew the rest.
Mahoney was convicted of filing fake T4 documents with the Canada Revenue Agency two years in a row. In 2011 he filed a T4 from a restaurant, indicating he had earned $30,124.98 working there. His legitimate T4 indicated he had been paid $9,961. As a result, he received a tax refund of $2,431 more than he was entitled. Seven other legitimate T4 documents issued to Mahoney by other employers were never filed.
Mahoney repeated the scam a year later, filing a fake T4 from another restaurant saying he had earned $27,409.11 . His actual earnings were $1,500. He got a tax refund of more than $9,420 more than he should have, and never filed seven other legitimate T4s.
In 2013, Mahoney established a larger scam wherein he’d create fake T4 documents for other people from random local businesses, go with them to a tax preparation service and wait while they filed their return, then split their instant refund. In most cases, the people had just met Mahoney, having been sent to him by mutual friends.
“Do you want a lot of money?,” he asked one girl. When she said yes, he helped her file a fake tax return, then took $1,000 of her $2,890.46 refund.
Other refunds ranged from $2,000 to $6,000, with Mahoney keeping half of the money or more.
Mahoney appeared in the St. John’s courtroom via video from a federal penitentiary in Nova Scotia, where he is serving a seven-year sentence for an armed robbery in September 2016.
His lawyer told the court Mahoney was suffering from a severe drug addiction at the time of the scams and the robbery, but has been participating in drug and alcohol counselling in prison. He has also completed courses in welding, first aid and other topics, and has plans to enrol in an electrical program at College of the North Atlantic when he’s released.
Prosecutor Bill Howse told the court the Crown had accepted a plea deal from Mahoney since a trial would have taken weeks and involved a number of young and vulnerable witnesses.
Judge David Orr accepted the lawyers’ joint suggestion of three months’ jail time on each of the Income Tax Act convictions, and nine months for the fraud, to run concurrent to Mahoney’s present jail term. He also ordered Mahoney to pay a fine of almost $12,000.
“Your honour, I’m in agreement with everything that’s been said so far,” Mahoney told the judge when asked before sentencing if he had anything to say. “I’d really appreciate being able to have the nine months and the fines along with that. It would be greatly appreciated.”
“Thank-you,” Mahoney said to the judge as court was adjourned. “Have a nice day.”
Twitter: @tara_bradbury
