CORBELLA: Alberta man wants to be charged criminally after CRA destroyed his life

The only thing Calgary engineer and high-tech inventor David Elderfield wants for Christmas is to be charged criminally by the Canada Revenue Agency (CRA).Sounds nuts, right? But Elderfield is neither crazy nor suffering from some bizarre case of masochism. Rather, defending himself before a transparent criminal court would be a relief, compared to remaining trapped inside the bureaucratic black hole of unaccountability, indifference and "ongoing torture" created by the CRA.Following an extensive investigation into his case, it's easy to understand Elderfield's strange wish.In short, the CRA seized his intellectual property, destroyed his business and his reputation.Elderfield, now 61 years old, was president and CEO of WayFare Identifiers Inc. (WFI) which had already made enormous technological leaps with unique sensor technology that could better secure our borders, airports and ports in a post-9/11 world. Testing was in place at the Prince Rupert Port, a UK port, and was approved for BC-Alaska border crossings when the CRA initiated actions against WFI.The CRA allegedly violated Elderfield's privacy and other edicts in the Canadian government's Taxpayer Bill of Rights through its handling of his file. As he attempted to seek restitution and closure, he was met with a vicious circle of buck passing from one government department or office to the next. The case falls outside of their jurisdiction, these offices have stated, including the Office of the Taxpayers' Ombudsman (OTO), the Department of Justice, Revenue Canada, the Prime Minister's Office, and others. Now, after denying him any service for six years, the OTO finally has run a year-long investigation and found the WayFare team has been due an apology from the CRA for more than 15 years. An apology is the greatest penalty the OTO can request of their peers at the CRA.Without any real explanation, the CRA has simply refused to apologize, so the OTO has just shrugged and closed the file. Just another example of government pretending to establish checks and balances on powerful state players when really just creating costly toothless tigers.Elderfield’s story is a maddening, stomach-churning cautionary tale to all Canadians of how the CRA — a bureaucracy of almost 60,000 employees — can destroy lives with no accountability."I asked the CRA to charge me criminally so I could defend myself in an open court, with an impartial judge, with rules of disclosure and witnesses testifying under oath," says Elderfield. "The CRA won't even release my files to me under the freedom of information act ... I've only received 22 pages out of 900 and those only arrived after seven years of repeated access to information requests from legal professionals had been ignored. It's abuse of power and smells of corruption."Basically, Elderfield says the CRA claims he owes money to the agency, claiming WFI was receiving undeclared revenues. Elderfield has proven there were none; WFI was a pre-revenue research and development shop. Elderfield says he poured in his entire life’s savings into the technology — he mortgaged his home and spent all of his retirement savings developing his border security devices to analyze cargo and initiate anti-money laundering reviews when illicit goods were discovered.In response to questions about this case, the CRA says that it does not discuss specific investigations.Elderfield has extensive management experience with tech leaders such as Sierra Wireless and NovAtel and had developed three patents in optical positioning and telephony by the age of 27. His border security patents were revolutionizing the safety of cargo and citizens around the world while speeding up the processing of container cargo. Drugs, arms and human trafficking were all targets of his system, as was the money laundering that feeds that supply chain.The technology — which could have remotely detected biological, volatile or nuclear particles and attempted tampering of cargo containers — was so promising that documents verified by the Western Standard show that WFI was certified to work with the military of Canada and the US. Records also show a successful pilot project with CP Ships (out of Tampa, FL) would have qualified the cargo container tracking devices for qualification under the US Department of Homeland Security, which was considering WFI as the Canadian representative on Homeland Security's Advanced Research Projects Agency’s Smart Container board.Heavy hitters in the world of security were on WFI's board of directors, including, four-star Gen. Larry Welch, a former US air force chief of staff, and the now late Vice-Admiral Albert Baciocco, the former principal for research and development with the US Navy.Elderfield and his partner started to work on this technology following the terrorist attacks of September 11 2001. In 2002 and 2003, former deputy prime minister Anne McLellan, Foreign Affairs Minister Bill Graham and other ministers had written letters of support after studying his work. It was based on this support that WFI was founded and incorporated.Alcan (now Rio Tinto Inc.) agreed to "supply to WayFare up to 28 tonnes of aluminum . . . produced at Alcan's Kitimat smelter at no cost to WayFare," states a memorandum of understanding dating back to July 13 2005. This document's authenticity was verified by a former vice-president of Alcan.Elderfield was being wooed by the US, including by the Montecito group, a US senator and others. He now regrets not accepting those US-based offers, but he and his partner wanted this ground-breaking technology to create jobs and benefits for Canada.Instead of pursuing wealth in the US, he's now worse than penniless. He's in debt and the CRA says he owes it more than $500,000 with the interest clock still ticking. This after forcing his home into foreclosure and seizing his fully-owned office building along with all the pertinent assets."It was a Canada Revenue Agency decision to intervene and interfere in our business when we were doing nothing but spending our own after-tax funds," says Elderfield, who states he and his family poured $1.3 million of savings into the company. Yet the CRA now claims Elderfield was taking an undeclared income from this company that was in debt to him for seven figures."We lost everything . . . . They destroyed needed technology and ensured we had nowhere to turn," says the father of three grown children, whom Elderfield says lost out on opportunities he wanted to provide them."The CRA crushed my career. They cut me off at the knees destroying my network of vendors, ex-clients and ex-employers. All of them received calls from the CRA, stating: 'Should you consider doing business with David Elderfield, you must call the CRA first.'"WFI had a signed and binding US$6 million contract with an Ontario-based REIT for a 50% position in WFI — meaning his company was valued at US$12 million. However, the CRA "took the outrageous action of calling that REIT and collapsing the deal," said Elderfield, who presents documentation to back up all of his assertions.Following months of correspondence with the CRA, Elderfield requested the company be audited to demonstrate his company and its books were legitimate and accurate. In early 2006, the CRA agreed to conduct a full financial audit. By then, Elderfield had lost the Bearspaw home that he designed and built on his 6.5-hectare property west of Calgary."Our office manager called the CRA to attempt to set up that audit once a week for more than 17 months," said Elderfield. A date was finally set but that date was cancelled and reset twice. For four months, all of the company's books and documents were laid out in its only boardroom awaiting the audit. Elderfield was confident the books would satisfy the CRA.On the third try, however, the CRA’s man in charge of the audit walked into WFI's office. “All he said was, 'I'm not doing this.' Within a minute of arriving, he left the building,” said Elderfield, who added that three other people witnessed the incident. Western Standard sought to speak to the auditor, who no longer works for the CRA, but was unable to reach him.Roger Sparks, a successful Alberta entrepreneur, was head of marketing for WFI at the time, working for shares in the company he believed in. He was there when the CRA auditor stormed out."We all looked at each other and wondered what happened," recalls Sparks. "He was there for about 30 seconds before he walked out."Pat Kelly, MP for Calgary Rocky Ridge, who was the Conservative party's shadow minister for National Revenue, was reportedly told by the CRA that Elderfield was trying to dictate how the audit would take place and that was what led to their representative’s rapid departure. Elderfield disputes he was trying to control the situation and notes that control over what happens within an audit lies with the auditor. (As a side note, in September 2016, Kelly sponsored a private member's motion, M-43, that would have investigated how to create a legally enforceable duty of care owed by the CRA to taxpayers when the CRA is grossly negligent. It did not pass in the House.)More recently, the CRA now claims to Elderfield their auditor was never there.All attempts to get the audit died without explanation and, towards the end of 2007, the CRA seized every asset belonging to Elderfield and WFI. Since then, for the past 16 years, Elderfield has been consumed with seeking justice for himself, to no avail. The Taxpayers' Ombudsman now states the circumstances around that audit warrant a full apology, but is powerless to force this from the CRA.In 2008, the CRA went after Elderfield again, this time for not declaring personal income tax in 2003 or 2004. This was unrelated to the CRA’s attacks on the company except that Elderfield was pouring all of his savings into his company and had no income. He admits he did not file income taxes in 2003 and 2004, but did file accurate “zero income” ones for those two years in 2008. The CRA refused to recognize those filings and, instead, manufactured a bogus $120,000 a year annual income for those years. This information is corroborated by his accountant, Ken Jones.Jones, of Calgary's Mitchell Jones Taxation, who was hired by Elderfield and studied all of the documentation, states in a February 7, 2018 letter to the CRA: "Our firm has been attempting to determine the basis for these arbitrary assessments of 2005 and 2006 for the past 28 months. Prior to that, we had been attempting to address this for over two years by clarifying the extensive corporate losses that our client had supported through loans (negative income) towards the R&D of the WFI Group. These loans came from my client's personal savings, a second mortgage on his primary residence, plus the collapsing of his RRSP accounts."Jones' letter includes the sentence: "The Department has given our firm absolutely NO information based on any FACTS."The CRA seized all of Elderfield's intellectual property, backup tapes, prototypes and display units, even though no resolution or appeal had yet been heard and sent it to Graham Auctions in Calgary to be sold.Dave Sangra, who had been contracted by Elderfield to do the machining of the technology, was tipped off about the sale, rushed to the auction house and managed to purchase the prototype display of a scaled-down version of the back end of a cargo container, a few of the remote-controlled locking mechanisms and one computer server.Shockingly, that computer server still had sensitive company information in it, including social insurance numbers, banking information and home addresses of many people — a potential violation of the third right in the Taxpayer Bill of Rights which states: "You have the right to privacy and confidentiality."That server is now stored with a forensic analysis company in another province to protect it from the CRA, to offer as proof of potential CRA negligence should Elderfield get his wish and be charged criminally.Sangra says he had purchased a $46,000 lathe that he used to fashion the aluminum, high-tech devices invented by Elderfield and had plans to hire about 15 staff in BC and about the same number in Calgary to help manufacture the devices."Instead, I ended up closing down my shop and was in debt $46,000," he said. "They (CRA) took an amazing company and product that would have revolutionized how shipping was done and crushed it."According to the federal government's website, in addition to the 16 rights that apply to all taxpayers, the Taxpayer Bill of Rights also has a five-part Commitment to Small Business acknowledging "their importance as the engine of growth in the Canadian economy."Just empty rhetoric.As for the CRA, its only response to more than one dozen questions is: "The CRA does not discuss specific cases nor does it comment on an investigation it may or may not be undertaking."This answer violates No. 15 in the Taxpayer Bill of Rights, which states: "You have the right to be represented by a person of your choice." Elderfield provided a signed and witnessed letter that gave this journalist the right to represent him.After years of trying, 22 pages out of an estimated 900 pages of the diarized notes of the CRA were released to Elderfield. These 22 pages are a damning indictment of the CRA's actions. One can only assume that what the CRA is not releasing would further impugn the CRA. For instance, on July 24 2007, the note states that Elderfield "has sold off his property in the past and paid off his taxes." A May 1 2008 note acknowledges that Elderfield's losses up to that point were "$1,177,904." These are admissions by the CRA that Elderfield paid his taxes and had negative income. And yet, the agency continued to pursue him and destroy his life and a company that could have helped the world.Elderfield has had the backing of numerous opposition MPs in trying to get the CRA to release information. The Taxpayers Ombudsperson had refused any service for six years until Senator Percy Downe personally delivered the WFI data to them, twice over two years. Elderfield is begging all of the leaders of the federal parties to follow these examples, to commit to fixing the CRA and to compensate him for his losses. He finds the situation similar to when Omar Khadr was paid $10.5 million in 2017 by the Canadian government for having been jailed in Guantanamo Bay."Omar Khadr was compensated because Canada failed to protect his Canadian rights, which remained despite his involvement in attacking Canadian allies post-9/11. How much more compensation is due to me when Canada attacked my rights because I expended my net worth to create defences for Canada and her allies in a post-9/11 response?” It's a good question.Because of the CRA investigation, Elderfield cannot afford to launch a civil case against the CRA. His only remedy is to be charged criminally to bring an end to his ordeal. Canadians should demand of their politicians that the CRA be put on trial instead.Licia Corbella is a Calgary-based, award-winning journalist and Western Standard contributor. corcomm@shaw.caX: @LiciaCorbella

CORBELLA: Alberta man wants to be charged criminally after CRA destroyed his life

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