CRA 'special adviser' joined industry lobby group amid probe of KPMG
CRA staffer turned paid consultant says CRA bosses suggested industry hire him
A special adviser on tax compliance at the Canada Revenue Agency left his job in early 2013 and a few weeks later joined an industry lobby group that was campaigning to curtail the powers of federal tax investigators and later sought to intervene in the CRA-KPMG case.
William Dobson had been working on a programme in the CRA's compliance division to combat tax evasion. He left the agency in January 2013 and later started work at the Chartered Professional Accountants of Canada, an organization that has been lobbying for years for limits on what accountants have to provide to tax authorities when clients are being audited and investigated.
Duff Conacher, who lectures on government and ethics at the University of Ottawa and co-founder of Democracy Watch, says the former special adviser to the CRA's compliance division should not have been allowed to work for industry so quickly after leaving government.
- KPMG offshore 'sham' deceived tax authorities, CRA alleges
- Government partnered with industry group fighting CRA
- Federal probe of KPMG tax 'sham' stalled in court
- Tax havens explained: How the rich hide money
"The problem is essentially that if public servants were allowed to just go from watchdogging an industry to go and work for the industry, then they have a huge incentive to please the industry while they're on the job," Conacher said.
CRA 'suggested' ex-employee go work for association
Both the industry association and Dobson say it was actually the CRA's idea that he go work for the organization.
"It was CRA that suggested that Bill might be interested in working with (the Chartered Accountants)," Gabe Hayos, vice-president of tax for the Chartered Professional Accountants of Canada, told CBC News.
Conacher said if that's the case, then the CRA has "fully and completely" violated its own code of conduct rules by suggesting that the industry group hire one of its former employees.
The CRA refused an interview on this story but, in a statement, said that current rules that prohibit employees from working for industry for a year after they leave the agency were only made effective on March 1, 2014 — a full year after Dobson left, so they did not apply to him at the time.
The agency said in a statement to CBC News that Dobson broke no conflict of interest rules and that "he did not have any significant dealings with his current employer prior to his departure from the CRA."
- Tory ministers met with KPMG as alleged tax 'sham' was probed
- At least 25 wealthy Canadians used tax scheme: filing
Dobson, however, said he first met his future employer while working on a CRA program to combat tax evasion and speaking to interested parties. "And I met Gabe, and when I retired, he took me on as a part-time contractor."
The CRA did not address whether one of its managers had recommended Dobson for the lobby group job, saying only that "CRA managers routinely provide professional references for employees."
If you have any information on this story, please contact [email protected] or phone Harvey Cashore at 416-526-4704. Follow @HarveyCashore on Twitter.
For more on this story, watch the documentary The Isle of Sham from CBC TV's The National.
Dobson, who worked on GST compliance for more than a decade, spent his last year at the CRA helping to develop legislation to register "tax preparers" — such as accountants and lawyers — to better help auditors spot tax cheats and non-compliance.
Dobson told CBC News that he did not work on audits while at the CRA and was only vaguely aware of the agency's pursuit of KPMG, in which the CRA alleges the accounting firm helped set up a "sham" tax avoidance scheme for multimillionaire clients involving shell companies in the Isle of Man.
"My understanding was (it was) out West somewhere. I wasn't involved with the audit so I don't know anything about the events leading up to it," Dobson said.
Ex-CRA bureaucrat hired for expertise in government
Hayos, CPA Canada's head of tax, told CBC News that he hired Dobson because he had held "senior positions" in the CRA, including its compliance division, and understood the agency's "inner workings."
"He's a knowledgeable individual. The CRA is a very large pyramid and Bill just has a good understanding of how it works. And that was a valuable resource for me," Hayos said.
Eight months after leaving the CRA Dobson registered as a lobbyist for CPA Canada. He was pursuing a variety of issues, including asking for greater confidentiality between clients and their accountants.
Lobby records also show that in September 2013, Bill Dobson registered to lobby his former colleagues at the Canada Revenue Agency — including assistant commissioner Richard Montroy — on issues including "enforcement" and "more effective and efficient audit programs."
CPA Canada says it is concerned about the principle of client confidentiality, and is arguing for restrictions on what accountants need to hand over to tax investigators.
CPA Canada committee included KPMG exec involved in alleged 'sham'
CPA Canada's website says Dobson was appointed to a tax advisory committee that includes KPMG's Paul Hickey — who, coincidentally, promoted the Isle of Man tax dodge inside his firm, and is a central player in the court fight over it with the federal government, according to documents filed in court.
In a statement, Gabe Hayos said the committee has never discussed the KPMG case.
Revenue Minister Kerry-Lynne Findlay and a spokesperson for the Prime Minister's Office have both said the government is not considering granting privilege to accountants similar to the type of confidentiality between lawyers and clients.
