Shock waves are still resonating this morning throughout the gold industry after Kitco Metals Inc, a prominent Montreal gold dealer, was cited by Revenue Quebec on Friday as being involved in a major tax fraud in the gold-trading sector.
In one of Revenue Quebec’s biggest probes in recent years, the revenue department alleges some 125 companies in the gold refining and trading industry engaged in a tax fraud scam on sales transactions worth $1.8 billion. It claims the firms also avoided paying the federal goods and services tax.
No charges have been pressed as yet, but in a statement, Revenue Quebec said it had reason to believe that Kitco worked with several entities and individuals in a scheme involving gold-bullion and gold-scrap transactions that allowed them to inappropriately collect provincial tax credits.
Kitco, a private corporation founded in 1977, said in a statement that Revenue Quebec’s claims are unfounded and that it intends to contest the allegations. Kitco defended itself, saying it has “never participated in any tax fraud, nor has it ever carried out any fictitious transactions.
In all respects Kitco vigorously contests all aspects of Revenue Québec’s investigation.” The company won court approval to appoint an interim receiver, RSM Richter, to help it deal with the allegations and negotiate a tax assessment amount that is outstanding.
To view the Nicolas Van Praet article: Kitco Metals Raided
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