Alberta tax evaders unlikely to win 'nonsensical' appeal of convictions, says legal expert

Grande Prairie 'tax protesters' fined nearly half a million dollars for tax evasion are unlikely to win their fight for an appeal, says a Canadian legal expert.

That's because they're relying on ludicrous legal arguments, said Ron Usher, adjunct law professor at Simon Fraser University.

Robert Dale Steinkey and Terry Lynn Steinkey were members of the now defunct Paradigm Education Group, led by a B.C. businessman who claimed that taxes were a form of slavery and people should not have to pay them.

"Unfortunately these people have doubled down on a seriously deluded fellow and it's going to hurt them," Usher said in an interview with CBC Radio's Edmonton AM.

"They've filed this crazy appeal of the provincial court sentence in federal court which is not going to work. It's complete nonsense, and it's just going to cost everyone a lot of time and money, including the defendants."

'You wouldn't have to pay' 

Following his conviction, Robert Steinkey, 60, was sentenced to a fine of $322,000, and given a conditional jail sentence of 22 months. His wife, 63, was sentenced to a fine of just over $164,000 with a conditional jail sentence of 18 months.

The Steinkes have filed a motion to appeal in federal court. In the statement of claim filed in December, the couple argues the provincial court did not have jurisdiction in their prosecution and they have already paid their debts through private indemnity bonds.

• Grande Prairie 'tax protesters' fined for tax evasion

"These people concocted an elaborate fantasy, with roots going back to the sovereign citizen movement in the United States, and various other attempts to think yourself out of the tax system," said Usher. "As you can see from these most recent filings, these [arguments] are nonsensical. It's nonsense."

Paradigm Education Group sold DVDs, instructional videos and offered seminars, instructing people on how to avoid paying income taxes. Group founder Porisky, of Chilliwack, and his students say they believed that as 'natural persons' they were not subject to taxes.

• B.C. anti-tax crusader sentenced to 5½ years
• Another B.C. man sentenced in connection to tax evasion scheme

"He sold that they had a special insight into the tax system, that taxes were not in fact due and owing, and that the whole legal system was illegitimate," Usher said about Porisky's teachings. "And therefore if you followed his special magic formula, you wouldn't have to pay taxes."

'It's a tragedy for all involved'

At its peak, more than 800 students subscribed the teachings. To date, 31 people — including Porisky — have been prosecuted and charged with criminal tax offences in relation to their participation with Paradigm.

On Dec. 7, 2015 both husband and wife pleaded guilty in Alberta provincial court to evading federal incomes taxes of $486,000 for the 2007 and 2008 tax years — an amount equal to the fines.

In addition to the court imposed fines, the pair will have to repay the full amount of taxes owed to the Canada Revenue Agency.

"The crown and the courts across Canada typically have gone against the ringleaders (of the protest group), but [the Steinkes] are unusual, because of the amount of money they were making," said Usher. "The Steinkes clearly had some success in life, which unfortunately has been thrown away. It's a tragedy for all involved."