CRA revokes the registration as a charity

The Canada Revenue Agency (CRA) will revoke the charitable registration of Escarpment Biosphere Foundation Inc., a Toronto area charity. The notice of revocation will be published in the Canada Gazette with an effective date of February 11, 2012.

On January 3, 2012, the CRA issued a notice of intention to revoke the charitable registration of Escarpment Biosphere Foundation Inc., in accordance with subsection 168(1) of the Income Tax Act. The letter stated, in part, that:

Our audit revealed that the Escarpment Biosphere Foundation Inc. (the Organization) received cash and pharmaceuticals with a purported value of over $407 million as a result of its participating in the Canadian Humanitarian Trust tax shelter gifting arrangement (Donation Program). It is our position the Organization failed to verify the value of the properties and to maintain direction and control over the distribution of the properties. Further, we believe the Organization agreed, for a fee of approximately $1 million, to lend legitimacy to the Donation Program by representing that it had received and distributed the properties in its own charitable programs. As such, it is our position the Organization failed to operate exclusively for charitable purposes by acting as a conduit for the Donation Program and redistributing 99% of the cash received to other parties in the Donation Program.

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