Nova Scotia

Cape Breton women behind massive tax fraud handed prison terms

Four Cape Breton women who cooked up a multimillion-dollar tax fraud made a last-minute effort at sentencing Thursday to defend their crimes. But it was too little too late as Lydia Saker and daughters Nadia Saker, Angela MacDonald and Georgette Young were handed prison terms ranging from two to four years.

4 women and 10 companies under their control claimed $56 million in sales

Nadia Saker is one of four women sentenced Thursday in Cape Breton for her role in a multimillion-dollar tax fraud. (Housewives in Heels)

Four Cape Breton women who attempted to make millions in a fraudulent tax scheme made a last-minute effort at sentencing Thursday to defend their crimes. 

But it was too little too late as Lydia Saker and daughters Nadia Saker, Angela MacDonald and Georgette Young were handed prison terms ranging from two to four years.

At the start of their hearing, the women asked Nova Scotia Supreme Court Justice Robin Gogan for more time to meet with a family doctor and review decades-old medical documents. 

"We believe she will diagnose us with post-traumatic stress disorder and that will connect to the crimes," Young told the court.

"[It will] speak volumes."

Gogan acknowledged the documents and accepted that the women had shared a history of domestic violence, but said their claims of PTSD could not be used to reduce their responsibility in the crimes. 

Angela MacDonald heads into the Sydney courthouse flanked by her mother, Lydia Saker, left, and sister Georgette Young. (Erin Pottie/CBC)

Gogan compared the women's operations to a tight-knit crime family with everyone involved in the scheme, although some had larger roles than others. 

"The Crown has characterized the offences as a sustained and escalating assault on the Canadian taxpayers' funds, and I agree," said Gogan.

Gogan said that the women could have stopped the scheme at various times but didn't. Gogan said there was no expression of remorse and no acceptance of responsibility.

Over a four-and-a-half year period, the women and 10 companies under their control claimed $56 million in sales on products such as cookbooks, salad dressing, frozen dinners and children's fur coats. 

When auditors from the Canada Revenue Agency came knocking, they found little evidence of those sales.

According to the CRA, the women were instead inflating their numbers and operating expenses in order to receive higher GST and HST refunds. 

Constantin Draghici-Vasilescu, a lawyer for the Public Prosecution Service, right, arrives at court in Sydney. (Erin Pottie/CBC)

The women were paid refunds totalling $275,000. But they were denied another $3 million after CRA auditors became suspicious.

None of that money was recovered.

Lydia Saker, the family matriarch, received two years in prison, while Nadia Saker and MacDonald will be expected to serve three years.

Georgette Young, who defended her family by saying they were merely "housewives who make cupcakes," was sentenced to four years. 

In addition to jail time, the women are also facing stiff fines.

Young was ordered to pay $2 million, MacDonald $961,000, Lydia Saker $335,000 and Nadia Saker $493,000.

Prosecutor Mark Donohue said the Crown will expect regular payments after the women are released, but said it's unlikely the fines will be paid in full.

Crown prosecutor Mark Donohue holds the door open for Georgette Young ahead of her sentencing hearing on charges related to a massive tax fraud. (Erin Pottie/CBC)

"It's important that [fines] be put in place because there may be someone down the road who commits this kind of offence — or a business, or corporation — and they will be able to pay," said Donohue.

"That's the hope, that they have a deterrent effect."

The women, who are probably best known for operating the Spaghetti Benders restaurant on Boularderie Island for 15 years, did not address the judge right before sentencing and said very little while being escorted out of the courtroom by sheriffs.

In total, Lydia Saker and her daughters spent six weeks on trial representing themselves despite the judge's caution to consider legal advice. 

Gogan said the women not only mocked the Canadian tax system, but also showed its vulnerabilities.

On Thursday, Gogan reiterated that the crimes would likely be ongoing if not for diligent public service workers.

ABOUT THE AUTHOR

Erin Pottie

Reporter

Erin Pottie is a CBC reporter based in Sydney. She has been covering local news in Cape Breton for 15 years. Story ideas welcome at erin.pottie@cbc.ca.

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