R. v. Jiang et al. Date:, 2017 BCPC 111

Citation: R. v. Jiang et al. Date: 20170418 2017 BCPC 111 File No: 233362-2, 233354-2 233358-2 Registry: Vancouver IN THE PROVINCIAL COURT OF BRITISH COLUMBIA Criminal REGINA v. WEN (VIVIAN) JIANG JIN (FANNY) MA MING KUN (MAKKIE) WU REASONS FOR SENTENCE OF THE HONOURABLE JUDGE G. RIDEOUT Counsel for the Crown: B. MacDonald Counsel for Jiang and Ma : C. Johnson, Q.C. Counsel for Wu : B.E. Mickelson

Place of Hearing: Vancouver, B.C.

Dates of Hearing: Dec. 16, 2015; Feb. 11, Apr. 21, Jun. 2, Oct. 28, 2016; Jan. 27, 2017 Date of Judgment: April 18, 2017 INTRODUCTION [1] Jin Ma (“Ma”), Ming Kun Wu (“Wu”) and Wen Jiang (“Jiang”), (collectively the “accused”) have entered guilty pleas to fourcharges pursuant to the Immigration and Refugee Protection Act (the “IRPA”), one count of forgery pursuant to the Criminal Code ofCanada (the “Code”), one count of tax evasion pursuant to the Income Tax Act (the “ITA”) and a count of fraudulently obtaining taxcredits pursuant to the ITA, (collectively the “index offences”). [2] The index offences all relate to an immigration scheme (the “scheme”) established by Xun Wang (“Wang”) through twoconsulting companies known as New Can Consultants Ltd. (“New Can”), incorporated in 2001, and Wellong International InvestmentsLtd. (“Wellong”), incorporated in 2004.

The two companies operated out of different locations and had a total of 14 employees,including the accused. The two companies offered immigration consulting services to citizens of the People’s Republic of China (the“PRC”). [3] The two companies offered a suite of services to Chinese citizens to make it appear that they were resident in Canada whenthey were actually living in China.

The purpose of the companies’ business was to allow Chinese citizens to illegitimately maintainpermanent resident status in Canada or obtain Canadian citizenship through fraudulent means. [4] The accused were not certified as Immigration Consultants with the Canadian Society of Immigration Consultants (the“CSIC”). This was required by the Immigration and Refugee Protection Regulations (the “IRPR”) prior to mid-2011, and by the IRPAafter mid-2011. [5] Like the accused, Wang entered guilty pleas to the same index offences as the accused.

Wang also entered a guilty plea to afurther count of defrauding the Government of Canada contrary to s. 380(1) of the Code. In Reasons for Judgment found at 2015 BCPC302 , Harris P.C.J. sentenced Wang to seven years in prison, and various required financial penalties. The sentence imposed byHarris P.C.J. was upheld by the Court of Appeal: 2016 BCCA 390. ISSUE [6] What is a fit and proportionate sentence to be imposed on each of the accused having regard to the aggravating and mitigatingcircumstances, the degree of their individual moral blameworthiness and the circumstances surrounding the index offences?

THE SCHEME [7] The investigation of Wang and his two companies commenced in or about 2010 by Citizenship and Immigration Canada (the“CIC”). The CIC is the body that administers applications for permanent residency and citizenship. [8] CIC officials noticed a spike in applications by Chinese citizens seeking renewal of their permanent resident cards. CICofficials became concerned when some of the applications gave the same residential address in Calgary.

Further investigation by CICofficials revealed that there were up to 63 Chinese citizens associated to this residential address in Calgary. [9] CIC officials forwarded their concerns to the Canada Border Services Agency (the “CBSA”). The CBSA is the investigativearm of the CIC. [10] CBSA investigators began to review various applications processed by Wang and his two companies.

CBSA investigatorsbecame highly suspicious that Wang and his two companies were involved in passport fraud, address fraud, employment fraud and thecreation of false immigration documents. [11] Three search warrants were executed on Wang’s residence and his two companies in October 2012. Investigators seized amassive amount of documentary and computer information. [12] As CBSA investigators reviewed the seized materials they became suspicious that Wang and his companies were also involvedin tax evasion.

The CBSA investigators, in conjunction with officials of the Canada Revenue Agency (the “CRA”), commenced aninvestigation into Wang’s tax activities. [13] In 2014, a Mutual Legal Assistance Treaty between Canada and the United States was invoked requiring the MicrosoftCorporation to send to the CBSA approximately 15,000 emails from Wang’s email address along with emails found on his desktop fromJiang and Wu. [14] Significant investigation resources were required as many of the documents and computer information had to be translated andthen entered into a searchable database in translated form.

It took approximately one year to organize the file into a searchable database. [15] CBSA investigators focused on four areas of fraud: passport fraud; address fraud; employment fraud and; falsified documents. (

i) Passport Fraud [16] The accused actively assisted clients in obtaining permanent resident status and/or Canadian citizenship. Some of their clientshad lived in Canada long enough that they were legally eligible for continued permanent residency or Canadian citizenship; however,

most were not. [ 17 ] A permanent resident is a citizen of another country that has been granted status to live, work, and study in Canada.

Permanent residents have the following rights and responsibilities: • They receive most social benefits that Canadian citizens receive, including health care coverage; • They are able to live, work or study anywhere in Canada; • They may apply for Canadian citizenship; • They are granted protection under the laws of Canada including the Canadian Charter of Rights and Freedoms ; • They must pay taxes in respect all Canadian laws of the federal, provincial and municipal levels. [ 18 ] Permanent residents have residency obligations. They must live in Canada for at least two years in any five year period.

If the permanent resident falls below that threshold, he or she would be at risk of losing permanent residency status as the permanent residency card would expire. [ 19 ] To get around this problem, clients were advised to report their PRC passport as stolen or lost to Chinese passport authorities. Clients would then apply for a new Chinese passport. The passport that was reported stolen or lost was forwarded to Wang’s companies in Canada to become part of the application for permanent residency.

The passport reported as stolen or lost would not contain the totality of entry and exit stamps from China which would have undoubtedly attracted CIC scrutiny. [ 20 ] Another way for clients to get around the risk of losing permanent residency status was to send client passports back to China where false or counterfeit stamps of Chinese entrance and exit stamps were cut and pasted into client passports. [ 21 ] As a result of the execution of the search warrants false or counterfeit stamp instructions were found relating to 243 separate clients. A total of 320 passports were also seized.

Some of NewCan’s and Wellong’s clients were issued multiple passports. (ii) Address Fraud [ 22 ] Applications by clients for citizenship and permanent residency were often made by clients who could not meet Canadian residency requirements because they lived in China. Canadian addresses and phone numbers were used in the applications to create the impression that the client was living in Canada. [ 23 ] Although real addresses and real phone numbers were associated to residences declared on applications, the clients did not reside at the addresses nor did they have access to the related phone numbers.

All mail or phone calls received at the addresses and phone numbers were forwarded along to NewCan and Wellong. (iii) Employment Fraud [ 24 ] Arrangements were made with clients to establish the appearance that they were either working in Canada or they were working for a Canadian company in China.

Wang created what were described as various “dummy corporations”; phony corporations in which phony jobs were created. [ 25 ] Harris P.C.J., in Wang , ibid. , at paras. 24 through 26, described the nature of the employment fraud: Employment Fraud … [24] Once the appearance of the employment was created, the client would pay their own salary including income tax deductions and Canadian Pension Plan and Employment Insurance deductions. This was done by funneling funds through Mr. Wang's business who would then issue payroll cheques to the client. Subsequently, Mr.

Wang would issue a tax T4 reporting slip and then he would file tax returns on behalf of the clients. [25] Phony salaries were sufficiently low so that the income tax that had been deducted was refunded. As a result, Working Income Tax Benefits were paid to the clients. [26] The employment fraud had two distinctive benefits. First from an immigration perspective, it created a paper trail that could be used for permanent residence renewals and citizenship applications by providing the client with false evidence of Canadian residency. Second, the scheme resulted in the client receiving the tax benefit.

The total amount of the tax benefits alleged was $187,901.24. (iv) False Documents [ 26 ] When the CBSA investigators executed the search warrants a large number of false documents were located. The documents were designed to create the false impression of residency in Canada by clients of NewCan and Wellong. [ 27 ] The seized documents included letters from schools to clients indicating dates that children attended certain schools, altered lease agreements and fraudulent letters from lawyers.

AGREED STATEMENTS OF FACTS [ 28 ] There were extensive Agreed Statements of Fact filed as exhibits in relation to each of the accused. The Overview contained in

each set of the Agreed Statements of Facts sufficiently establishes the participation of the accused in the scheme and in their evasion of taxes: (

i) Ma [ 29 ] From March 1, 2008, until October 17, 2012, Ma was employed as an immigration consultant at Wellong. Wellong was a closely held immigration consulting company owned and directed by Wang. Ma was never registered as an immigration consultant. [ 30 ] Wang and his employees, including Ma, were engaged in the long term, large-scale, multifaceted immigration fraud. The 249 Chinese nationals, who had been identified by CBSA as Ma’s clients, paid at least $1,776,950 to Wellong for services. [ 31 ] Ma received commissions in addition to her salary while employed by Wellong.

She never claimed her commissions and other payments received as income to the CRA. Commencing in February 2011, Ma also stopped reporting her salary as income. Ma also applied for, and received, tax credits and benefits for which she was not eligible. [ 32 ] In total, for the years between 2009 and 2012, Ma failed to report $361,351 in income and, as a result, evaded $73,334 in federal income taxes.

She also received $22,611 in tax credits and benefits to which she was not entitled. (ii) Wu [ 33 ] From 2005 until October 17, 2012, Wu was employed as an immigration consultant at New Can, a closely held immigration consulting company owned and directed by Wang. Wu was never registered as an immigration consultant. [ 34 ] Wang and his employees, including Wu, were engaged in a long-term, large-scale, multifaceted immigration fraud.

The 147 Chinese nationals who had been identified as Wu’s clients paid at least $1,182,880 to New Can for her services. [ 35 ] Wu received commissions in addition to her salary while employed by New Can. She never claimed her commissions and other payments received as income to the CRA. Wu also applied for and received tax credits and benefits for which she was not eligible. [ 36 ] In total, Wu failed to report $231,914 of income and, as a result, evaded $45,431 in federal income taxes.

She also received $5,296 in tax credits and benefits to which she was not entitled. (iii) Jiang [ 37 ] From February 1, 2008, until October 17, 2012, Jiang was employed as an immigration consultant at Wellong. Jiang was never a registered immigration consultant. [ 38 ] Wang and his employees, including Jiang, were engaged in a long-term, large-scale, multifaceted immigration fraud. Jiang assisted at least 174 clients who paid Wellong $1,091,630 in fees. [ 39 ] While employed by Wellong, Jiang received commissions in addition to her salary.

She never reported her commissions and other payments received as income to the CRA, and after July 2011, did not report her salary, either. Jiang also applied for and received tax credits and benefits to which she was not entitled. [ 40 ] In total, for the years between 2009 and 2012, Jiang evaded $59,050 in income taxes and improperly received $15,709 in tax benefits and credit. PERSONAL CIRCUMSTANCES OF THE ACCUSED (

i) Ma [ 41 ] Ma filed a comprehensive defence brief, which included her letter of apology to the court, seven character reference letters, and a psychological assessment prepared by Dr. Patrick Bartel. [ 42 ] Ma is 48 years old. She was born and raised in Chongqing, China. She was one of two girls born to an intact family. When she was several months old she was diagnosed with meningitis and spent several months in the hospital.

As a result of the meningitis she was left with weakness in her body, balance problems and cognitive deficits in memory and language. [ 43 ] Her parents eventually separated when she was 17 years old. Academically, high school was a struggle for her, though she was able to graduate with below average grades. After graduating from high school, Ma moved to the city of Shenzhen where she eventually met and subsequently married her first husband, who also had custody of a daughter from his first marriage.

Shortly after her marriage, Ma gave birth to her first daughter. [ 44 ] Her husband experienced business difficulties and conflicts which resulted in the dissolution of his business. Disappointed with the state of affairs in China, the family moved to Canada in 2000. While in Canada, Ma gave birth to her second daughter. Ma’s daughters are now 21 years old and 16 years old respectively. [ 45 ] Ma’s marriage collapsed and she initiated divorce proceedings in 2008. She remarried in 2012 and currently resides with her husband and her two daughters in an apartment in Vancouver.

Ma has been unable to find employment, in large measure as a result of these proceedings. [ 46 ] Ma is a Canadian citizen. [ 47 ] Ma’s outstanding tax bill from CRA, including penalties, apparently exceeds $200,000. Collection proceedings have not been commenced by the CRA as there remains some prospect of an agreement upon conclusion of these proceedings.

[ 48 ] In her letter of apology to the court, Ma stated that a friend of hers introduced her to Wang in 2008. She was grateful when she was hired by Wang in August 2008, despite the fact that she had limited English skills and “zero experience in doing immigration work.” [ 49 ] Ma stated that it was not until 2010 that she became aware that Wang was using fake passport stamps or altering passport stamps. She further stated that she was told by Wang that the creation of a phony employment paper trail was for the purpose of helping clients to create a record of paying taxes.

She explained that at the time she was involved with the creation of phony employment records and phony records for payment of taxes by clients, that she did not view such activities as being illegal. [ 50 ] Ma stated that she “eventually turned a blind eye” to what she was doing and described her role as a “messenger” for Wang. She rationalized that she maintained her employment with Wellong, even after she became aware of its illegal activities, as she needed the employment to support herself and her two children. [ 51 ] In Dr.

Bartel’s assessment, he reported asking Ma why she continued to work for Wellong when she became aware of its illegal business practices. She stated, (1) the job was difficult to come by and was difficult to give up; (2) she did not truly understand the laws of Canada and the scale of the problem; and,

(3) Wang claimed to be an immigration consultant and therefore he ought to have known what was legal and what was not legal. [ 52 ] Ma also told Dr. Bartel that when she told Wang in 2009 of her intention to leave the company that she felt he coerced her to continue to work for Wellong. She described Wang as a dominant and overbearing individual. [ 53 ] Dr. Bartel described Ma as being unassertive and compliant. She was also described as unassertive and compliant in her dealings with Wang. [ 54 ] Dr.

Bartel found no evidence of any thought disorder or unusual symptomology in relation to Ma’s mental health functioning. Since she was charged with the index offences she developed symptoms of depression, hopelessness, and helplessness. [ 55 ] Ma told Dr. Bartel that her stressors related to the current legal proceedings. She further stated that her physician has prescribed antidepressant medication. [ 56 ] In his conclusions, Dr. Bartel diagnosed the presence of an Adjustment Disorder with mixed anxiety and depressed mood. The Adjustment Disorder developed after Ma was charged with the index offences. [ 57 ] Dr.

Bartel was of the opinion that Ma was at a low risk to reoffend. He observed that Ma is currently experiencing moderate disruptions as a result of the Adjustment Disorder. Should the stressors in relation to the Adjustment Disorder continue over the long term, it was Dr.

Bartel’s further opinion that her psychological condition would worsen and develop into a more serious mental illness, likely major depression. (ii) Wu [ 58 ] Wu filed a comprehensive defence brief, which included her letter of apology to the court, three character reference letters, correspondence with CRA, correspondence from World Vision, and a psychological report prepared by Dr. James Browning. [ 59 ] Wu is a 39-year-old married woman, originally from China. She has two young children, aged 6 and 8. [ 60 ] Wu was born and raised in a close and supportive family in Fusong, China.

Academically, she excelled at school and completed a Bachelor of Science in Computer Science in China. When she immigrated to Canada in 2001, she studied Management Information Systems at BCIT. She then completed a Master of Business Administration at a private college in Vancouver. She commenced employment with New Can in 2003 and worked there for nine years as an unlicensed immigration consultant. [ 61 ] For the past two years she has been working for a company that provides research in the cosmetic industry. [ 62 ] Wu met her husband in 2001, and they were married in Canada in 2003.

Her relationship with her husband has been marked by financial problems and other relationship issues. She is essentially the sole income earner for the family and the parent principally responsible for the care of the children and the maintenance of the household. [ 63 ] Wu submitted that she was a very involved and loving parent of her two children. The children attend private school, enjoy horseback lessons, drawing lessons, dance lessons, ski lessons and golfing lessons. Wu enrolled the children in these various activities.

She was also the person who drove the children to and from the majority of these activities. [ 64 ] Wu is a Canadian citizen. [ 65 ] On September 11, 2015, Wu paid her total outstanding income tax debt to the CRA in the amount of $133,960.40. [ 66 ] In her letter of apology to the court, Wu described being personally proud of her employment with Newcan. Her employment allowed her to be financially independent and, over time, her personal income significantly increased. [ 67 ] Initially, Wu believed that Newcan was providing both legal and reasonable services to clients.

She “gradually realized” that the business practices of New Can may not be legal. Wu came to the realization that the scheme was designed to establish the appearance that clients met residency requirements through the use of passport fraud, address fraud, employment fraud and false documentation. [ 68 ] She went on to state: At that time, I was numbed by the high income. I understood that this unusual way of doing business is illegal, however, the income was high, and due to the lack of knowledge of the law, I thought that I might be able to take a chance since I was merely an employee who

simply replied client’s emails and received client’s documents, and that I was just working under the boss’s instructions. [ 69 ] Wu expressed great remorse over her involvement in the scheme. She expressed feelings of deep guilt and self-condemnation. She asked for forgiveness and begged for leniency so she would be able to take care of her children. [ 70 ] In his psychological assessment, Dr. Browning described Wu as stressed and saddened as a result of the index offences; though since entering her guilty plea, her mood was less sad though she still experienced feelings of guilt. [ 71 ] Dr.

Browning was of the opinion that Wu’s continued participation in scheme “appeared to be influenced to some degree by severe financial and relationship stress, which included significant indebtedness to the company’s owner by her husband and lack of employment on his part, making her the sole breadwinner.” [ 72 ] Dr. Browning was of the opinion that Wu was suffering from depression when she was charged with the index offences. He further commented that it was hard to see how Wu’s family would function should she be incarcerated as she was the principal income earner and caregiver for the children. [ 73 ] Dr.

Browning recommended that the family receive professional support to address continuing serious family dysfunction. (iii) Jiang [ 74 ] Jiang filed a comprehensive defence brief which included her letter of apology to the court, ten character reference letters and a psychological assessment prepared by Dr. Patrick Bartel. [ 75 ] Jiang is a 49-year-old married but separated woman, originally from China.

She was born into a military family and her early years were spent living on a military base in Shenyeng. [ 76 ] Academically and socially she did well in school and achieved high grades through both elementary and high school. [ 77 ] During this time her life became somewhat complicated as she suffered from a hair loss condition which persisted on and off until she was approximately 30 years old. This condition caused her to be embarrassed and humiliated. [ 78 ] After completing high school, Jiang went on to university where she completed a degree.

Following her graduation from university, she moved to a small tourist city and worked for 8 to 10 years with an airline company. She began to struggle emotionally and decided to make a life change by moving to Beijing where she studied English and also met her future husband. [ 79 ] She became pregnant shortly after meeting her future husband and gave birth to a daughter, who is now 16 years old. Jiang married within the year following the birth of her daughter. [ 80 ] In 2003, Jiang obtained employment with an immigration company in Beijing.

It was through her employment there that she first met Wang when he was on a Wellong related business trip to Beijing. At the time that Jiang met Wang, she was also planning to move to Canada. [ 81 ] After several trips to and from Canada and China, Jiang moved permanently to Canada with her daughter in 2007. In February 2008 she joined Wellong. [ 82 ] Jiang obtained qualifications as an immigration consultant prior to her arrest for the index offences. Jiang has been unemployed since her arrest. She is currently residing with her daughter in an apartment. [ 83 ] Jiang is a dedicated Christian.

She regularly attends worship at Fruitful Life Christian Church. She also volunteers her time at the church. All of the character reference letters speak highly of Jiang’s good character. [ 84 ] Jiang’s husband is a citizen of China where he operates a business. He does have occasional visits with his daughter. [ 85 ] Jiang is a permanent resident in Canada. [ 86 ] Jiang has paid the CRA for her unpaid taxes owing and tax penalties in the sum of $170,000. [ 87 ] In her letter of apolgy to the court, Jiang described feeling excitement in obtaining employment in 2008 with Wellong.

In the beginning her duties were principally to translate documents. She described her salary as “low” and she did not receive any commissions. She also believed at that time that Wang was a licensed immigration consultant. [ 88 ] Over time, at the direction of Wang, she teamed up with Ma and her duties increased including completing client applications, answering phone calls and, eventually, meeting with clients to provide immigration services. [ 89 ] Jiang stated when completing final resident applications for clients it was Wang who completed some of the crucial parts, such as the details of employment fraud.

At one point, Jiang questioned Wang about his immigration business as she was concerned about the legality of the business. Wang told Jiang her that it was none of her business. At that time, Jiang thought about quitting the job but did not do so. [ 90 ] In relation to the passport fraud, Jiang stated that she was aware that Wang was manipulating clients’ passports that she thought was wrong though it never occurred to her that she should report her concerns to anyone.

She described “trembling with fear” for many years and feeling threatened by Wang when she tried to leave Wellong. [ 91 ] Jiang apologized for her “unforgivable mistake” in failing to declare commission earnings. When she received a letter from the CRA demanding payment of unpaid taxes and penalties she was upset, shocked and humiliated by her wrongdoing. With the assistance

of her husband, they managed to pay off the debt as soon as possible. [ 92 ] Jiang admitted that she made a huge mistake in participating in the scheme and that she was “too weak to do the correct thing. I feel absolutely terrible about this.” [ 93 ] Jiang is focused on her daughter’s future and feels that the next three years will be crucial to her daughter as she prepares for university. [ 94 ] Jiang asked the court for mercy for her daughter’s sake. [ 95 ] In Dr.

Bartel’s psychological assessment, Jiang told him that after approximately six months working for Wellong, she began to notice irregularities and she sensed that something was not right with the business practices of Wellong. [ 96 ] When she raised those concerns with Wang he reassured her that he was licensed and all business practices were appropriate. Jiang went on to tell Dr. Bartel that at some point she realized that what Wang and Wellong were doing was wrong, so she decided to leave the company in July 2010.

After several months away from Wellong, she felt threatened by Wang and felt she was forced to return to Wellong. [ 97 ] As part of his assessment, Dr. Bartel posed five specific questions to Jiang with respect to her wrongdoings summarized as follows: Q. Her role as an “unregistered immigration consultant”? A. She denied working as an unregistered immigration consultant; rather characterized her role is that of a salesperson who liaised with clients. She never identified herself as a “consultant”; Q. Failure to declare commission earnings to CRA? A.

She admits not declaring commission earnings while denying that she did not do this to intentionally avoid paying taxes. She never thought to consult with an accountant and relied on advice from Wang; Q. Altering passports and falsifying employment and address information? A. Wang told her and other employees that it was none of their business. Wang was responsible for the completion of crucial parts of important documents. Her role was to complete basic information on various applications; Q.

Altering travel history on client applications for permanent resident card renewals and for obtaining Canadian citizenship? A. She understood that Wang was responsible for clients obtaining Canadian citizenship through a policy known as the Humanitarian and Compassionate Policy. When clients asked her for help with their passports she would refer the clients to Wang. She denied that she ever altered any passports; Q. Falsely representing that applicants were living in Canada at Canadian residences and using Canadian telephone numbers controlled by Wellong? A.

She denied filing any applications that misrepresented client’s addresses or telephone numbers. She simply filled out forms with information given to her by Wang. [ 98 ] Jiang told Dr. Bartel that she clearly was not innocent and she made many mistakes. That said, she reported that, though she was involved in the scheme, she was not involved in any direct planning or organizing of illegal activities. [ 99 ] Dr. Bartel diagnosed the presence of Major Depressive Disorder characterized by significant and prolonged depressed mood, loss of interest, negative thoughts, helplessness and hopelessness, shame and guilt.

There was some indication of suicidal ideation. [ 100 ] Dr. Bartel also made it clear that the presence of the Major Depression Disorder was in response to the index defences and the consequences which could flow from the index offences, including possible incarceration and deportation. [ 101 ] Dr. Bartel opined that it was likely that Jiang did not have the personality which would predispose her to assert her authority or challenge an individual such as Wang.

In addition, from the history given by Jiang, Wang provided her and other employees with reassurances that there was nothing amiss in the business practices of Wellong. [ 102 ] Dr. Bartel described Jiang’s sense of shame as “high and unhealthy.” She views herself as someone who was bad and a social pariah. [ 103 ] Dr. Bartel found that Jiang presents a low risk to reoffend. POSITION OF THE PARTIES (

i) The Crown [ 104 ] The Crown submitted that general deterrence and denunciation were the paramount sentencing principles that should apply in relation to each of the accused. [ 105 ] The Crown metaphorically described Wang’s role in the scheme as the engine with each of the accused being the wheels that propelled the engine. The accused were an integral part of a complex and sophisticated scheme that operated over a number of years and

involved the fraudulent creation and use of forged and altered documents, including Chinese passports. [ 106 ] In

summary, the Crown identified the following factors as highly aggravating: • The main purpose of each of the accused participation in the scheme was to earn money by committing frauds; • The scope of the frauds, including the number of clients, and the revenue from those clients in the number of years each accused participated in the scheme; • Forgeries including the alteration of government documents; • Each of the accused evaded federal income taxes, and they also went further and fraudulently claimed thousands of dollars in Child Tax Benefits and Credits. [ 107 ] In

summary, the Crown identified the following factors as mitigating: • Guilty pleas; • The personal circumstances of each of the accused; • The absence of any criminal record, though the absence of a criminal record likely permitted each accused to carry out the frauds. [ 108 ] The Crown submitted that each of the accused should receive a conventional jail sentence of 30 months on the IRPA charges and an additional six months consecutive on the tax evasion charges for a total of three years in a federal penitentiary. [ 109 ] The Crown submitted that the fines to be imposed for tax evasion would be $95,945 in relation to Ma, $50,727 in relation to Wu, and $74,767 in relation to Jiang.

For receiving tax credits fines of $22,611 in relation to Ma, $5,296 in relation to Wu and $15,709 in relation to Jian ought to be imposed. [ 110 ] In both its written and oral submissions, the Crown relied on numerous authorities in support of their position. Where appropriate and useful, reference will be made to those authorities in the Analysis

section of these reasons. (ii) The Accused [ 111 ] The accused emphasized that a Conditional Sentence Order (“CSO”) of two years less one day to be served in the community by operation of s. 742.1 of the Code would be a fit and proportionate sentence. [ 112 ] The CSO, to be effective, would necessarily contain strict conditions to address the principles of deterrence and denunciation. Those conditions would include the imposition of a strict curfew.

It was proposed that a period of probation should follow which would allow the accused time to pay financial penalties arising from the tax evasion charges. [ 113 ] The accused were characterized as “dupes” of Wang. He alleviated their concerns with reassurances that all proper licences were in place. [ 114 ] As time progressed, the accused sensed that Wang was not operating within the law. Notwithstanding, the accused continued to work for Wang and his two companies rather than quit and go to the authorities with their suspicions.

In hindsight, the accused conceded that was a mistake. [ 115 ] The accused characterized Wang as the “mastermind” of the scheme while the accused were characterized as subservient employees.

They acted upon the instructions of Wang though the accused conceded that would not amount to a defence, but rather operates as a mitigating factor. [ 116 ] The accused noted that while Wang was on release in relation to his index offences, he committed further immigration offences which Harris P.C.J. found to be a significant aggravating factor in sentencing Wang to an effective seven-year prison sentence. [ 117 ] The accused submitted that they have conducted themselves in a lawful and appropriate manner from the date of their arrest. [ 118 ] They submitted that the court should take into account the stigma suffered by the accused arising from news media scrutiny surrounding this case.

They all have suffered from shame and embarrassment arising from the publicity which, in part, addresses the principles of general deterrence and denunciation. [ 119 ] The accused were subjected to severe financial penalties arising from their tax evasion. Jiang and Wu have paid their full tax debt, with penalties, imposed by the CRA.

Ma is not currently in a position to pay her full debt, with penalties, though there is some expectation of an agreement upon resolution of these proceedings. [ 120 ] Jiang submitted that as she was a permanent resident of Canada she potentially would face immigration collateral consequences which would flow from any sentence imposed in relation to the index offences. [ 121 ] The accused submitted that the court should also take into account present health consequences as described in the reports of Dr. Bartel and Dr. Browning.

Those health consequences could be exacerbated by the imposition of a period of incarceration. [ 122 ] The accused submitted that the guilty pleas were indicative of their genuine remorse for their conduct. These were individuals with no prior criminal record. They were psychologically assessed as being at a low risk of reoffending. [ 123 ] They further submitted that the letters of reference filed on their behalf support a finding that they were individuals of prior good

character and reputation in the community. [ 124 ] In particular, the accused urged the court to exercise leniency as the accused were the principal caregivers for their children. They have been devoted and caring parents, and the imposition of a conventional jail sentence would have a detrimental effect on the children. [ 125 ] In both their written and oral submissions, the accused relied on numerous authorities in support of their position. Where appropriate and useful reference will be made to those authorities in the Analysis

section of these reasons. (iii) Crown Submissions in Reply [ 126 ] The Crown submitted that in relation to Wu and her concerns over care for her two young children that there was no evidence to suggest that Wu’s husband could not provide basic care for his children in the event she was incarcerated. [ 127 ] The Crown questioned the reliability of Jiang’s assertion that she was coerced or threatened in any way by Wang. The Crown made reference to emails between Wang and Jiang which did not reflect any fear of Wang, or any reluctance by Jiang to participate in illegal activities.

The Crown submitted that any reluctance on the part of Jiang was based upon her fear of getting caught. [ 128 ] The Crown submitted that there were emails exchanged between Wang and all of the accused that would establish they had direct knowledge that Wang and his companies were involved in a significant immigration fraud. [ 129 ] The Crown submitted that the accused minimized their involvement in the scheme and tried to foist much of the blame on Wang.

Each of the accused lived a dishonest life for years and as a result of their conduct fooled the Government of Canada into thinking that their clients were eligible for Canadian permanent residency or citizenship. [ 130 ] They achieved this purpose, and made a significant income, through their relationship with Wang and his companies. This relationship was one of mutual benefit with each party helping the other to make money through fraudulent means. THE INDEX OFFENCES [ 131 ] The accused entered guilty pleas to a variety of indictable offences relating to the IRPA , the Code and the ITA .

The breakdown of the counts to which guilty pleas were entered, and the potential maximum penalties, is outlined as follows: (

i) The IRPA Charges (

a) Counts 1 and 2 [ 132 ] Prior to June 30, 2011, s. 13.1(1) of the IRPR governed immigration consulting. After June 30, 2011, s. 91 of the IRPA governed immigration consulting. The accused’s immigration consulting misconduct straddled the statutory change. [ 133 ] The only distinction in relation to the penalty provisions relates to the potential fine. Prior to June 30, 2011, the maximum potential fine was not more than $50,000 where proceedings were by indictment. Following June 30, 2011, the maximum potential fine was increased to not more than $100,000. [ 134 ] The potential maximum jail term of two years remained the same in relation to the two counts. (

b) Counts 3 and 5 [ 135 ] Count 3 relates to a violation of s. 122(1) (

b) and (

c) of the IRPA which prohibits a person from using, importing, exporting or dealing in documents in order to contravene the IRPA . By operation of s. 123(1), the maximum potential penalty for a contravention of s. 122(1) (

b) or (

c) is a jail term not to exceed 14 years. [ 136 ] Count 5 relates to a violation of s. 127 of the IRPA which prohibits a person from knowingly directly or indirectly misrepresenting or withholding material facts relating to a relevant matter that induces or could induce an error in the administration of the IRPA . By operation of S.128, the maximum potential penalties for contravening s. 127 of the IRPA is a fine not to exceed $100,000 or a jail term not to exceed five years. (ii) The Code (

a) Count 7 [ 137 ] Count seven relates to forgery contrary to s. 366(1) of the Code . By operation of s. 367(a), the maximum potential penalty is a jail term not to exceed 10 years. (iii) The ITA Charges (

a) Count 11 [ 138 ] Count 11 relates to s. 239(1) of the ITA which prohibits a person from willfully evading or attempting to evade payment of federal income taxes. By operation of s. 239(2)(

a) and (b), any person who evades payment of federal income taxes is subject to a mandatory fine and maximum potential jail term not to exceed five years. (

b) Count 12 [ 139 ] Count 12 relates to s. 239(1.1) of the ITA which prohibits a person who fraudulently obtains tax credits for clients. By operation

of s. 239(2)(

a) and (b), any person who fraudulently obtains tax credits for clients is subject to a mandatory fine and a maximumpotential jail term not to exceed five years. ANALYSIS (

i) Overview [140] It is fundamental to our immigration and federal tax process that there is strict compliance with the provisions of the IRPA andrelated Regulations, and the ITA and related Regulations. [141] The Federal Government of Canada, and by extension the people of Canada, look to all individuals to act in an honest andtrustworthy manner to ensure compliance with the IRPA and the ITA. [142] One of the purposes of the IRPA is to permit the federal government to screen and control immigration into Canada, to ensurethat only those deemed qualified are granted entrance.

The integrity of the IRPA process is undermined, and the confidence of theCanadian people in the immigration process compromised, when individuals, such as the accused, are involved in immigration fraud. [143] One of the purposes of the ITA is to generate the payment of federal taxes for much-needed revenue. Canada’s income taxsystem has been characterized as an honour system of compliance. Those who willfully file falsified returns cheat the state of taxrevenue and increase the tax burden on Canadians at large: R. v.

Wilm, 2017 ONCJ 97, at para. 15. [144] The fact that breaches of s. 239 of the ITA are to be considered as criminal law reflects the seriousness of tax evasion. Section239 imposes a public duty on taxpayers to honestly complete tax returns: R. v. Knox Contracting, (SCC), 1990 2 SCR338, at paras. 18 and 19. (ii) The Role of the Accused in the Scheme [145] In Wang, supra, at para. 31, Harris P.C.J. summarized the complexity and sophistication of Wang’s scheme as follows: In

summary, Mr. Wang's offences were complex, sophisticated, and well thought-out. It is noted his offences were committed over anumber of years and involved co-opting the assistance of others. It is clear he was the mastermind behind the scheme. His conductlikely contributed to numerous persons fraudulently obtaining permanent residency and citizenship.

I expect the Immigration authoritieswill have to review the circumstances of all those concerned and it is quite likely that some persons will be removed from Canada. [146] While Wang was the mastermind he would not have been able to perpetuate the financial success of the scheme without theassistance of others, including the accused. The scheme generated significant fees paid by client for services provided by Wang and histwo companies. The accused were not just bit players.

They were an integral part of the scheme. [147] In addition, the accused all realized significant illegal income from services they provided to their clients. They failed to reporttaxable income over many years. Likewise, they obtained refunds or credits to which they were not entitled over many years through thefalsification of income tax returns. They were motivated by greed. [148] The scheme continued for many years.

The scheme only began to unravel when CIC officials noted the permanent residencyanomaly in which 63 Chinese citizens were associated to a single address in Calgary identified as their permanent address. It would notbe unreasonable to infer that the accused would have continued to work for NewCan and Wellong had the CIC and the CBSA notcommenced their investigation. [149] In Ma’s letter of apology to the court, she suggested that it was only in hindsight that she realized that Wang was involved in anillegal scheme.

That would not explain her statement that she “turned a blind eye to what he was doing and told [her]self that [she] wasonly doing the job of a messenger.” [150] Similarly, Jiang suggested that Wang was the “boss” and that she was to do what she was told.

She continued to work forWellong after she became aware that Wang was using falsified passport stamps as she felt “threatened.” That was contrary to her earlierstatement when she admitted that she did not quit her employment because she needed to work “so badly” for her family. [151] It must be kept in mind that Jiang evaded federal income taxes, over approximately five years in the sum of $59,058 andreceived tax credits and benefits to which she was not entitled in the sum of $15,709.

Ma evaded federal income taxes in the sum of$73,334 and received tax credits and benefits to which she was entitled in the sum of $22,611. [152] Accordingly, I give little weight to Ma’s assertion that it was only in hindsight that she became aware of the illegality of Wang’sscheme. Similarly, I give little weight to Jiang’s assertion that she was either coerced or threatened by Wang to continue herinvolvement in Wang’s illegal scheme. (iii) Collateral Sentence Consequences (

a) Immigration Consequences [153] Ma and Wu are both Canadian citizens and therefore will not suffer any immigration consequences collateral to any sentenceimposed upon them. Jiang is a permanent resident of Canada. She submitted that she may be subject to collateral immigrationconsequences due to her permanent residency in Canada by operation of the IRPA. [154] Section 36(1)(

a) of the IRPA provides: 36

(1) A permanent resident or a foreign national is inadmissible on grounds of serious criminality for

(

a) having been convicted in Canada of an offence under

an Act of Parliament punishable by a maximum term of imprisonment of at least 10 years, or of an offence under

an Act of Parliament for which a term of imprisonment of more than six months has been imposed; … [ 155 ]

Section 64 of the IRPA provides: 64

(1) No appeal may be made to the Immigration Appeal Division by a foreign national or their sponsor or by a permanent resident if the foreign national or permanent resident has been found to be inadmissible on grounds of security, violating human or international rights, serious criminality or organized criminality.

(2) For the purpose of subsection (1), serious criminality must be with respect to a crime that was punished in Canada by a term of imprisonment of at least six months or that is described in paragraph 36(1) (

b) or (c). [ 156 ] The maximum potential penalty for a contravention of s. 122(1) (

b) and (

c) of the IRPA is 14 years in prison. [ 157 ] The maximum potential penalty for a contravention of s. 366(1) of the Code is 10 years in prison. [ 158 ] The objective maximum possible sentences for the s. 122(1) IRPA offence and the s. 366(1) Code offence determines Jiang’s admissibility status, thus triggering her risk of deportation.

The actual sentence imposed pursuant to s. 64 of the IRPA affects her ability to appeal any finding of inadmissibility that may be made against her. [ 159 ] It would be likely that by application of s. 64(1) of the IRPA that Jiang’s guilty pleas to the two above offences would fall under the category of “serious criminality.” [ 160 ] By application of s. 64(2) of the IRPA , Jiang is prohibited from appealing a finding of inadmissibility if she receives a sentence of six months or more in prison.

A CSO of six months less one day or a conventional jail sentence of six months less one day would leave open the possibility of her being able to appeal a finding of inadmissibility. [ 161 ] Whether the Crown position on sentence prevails or Jiang’s position on sentence prevails, she will still likely face a Removal Order as she would be inadmissible on the ground that she has been convicted of offences of serious criminality.

Moreover, if she was sentenced to a CSO or conventional jail of at least six months she would lose her right to appeal any finding of inadmissibility resulting in the imposition of any Removal Order. [ 162 ] The Supreme Court of Canada (the “SCC”) in R. v.

Pham , 2013 SCC 15 , at para. 14 , held that: “… a sentencing judge may exercise his or her discretion to take collateral immigration consequences into account, provided that the sentence that is ultimately imposed is not disproportionate to the gravity of the offence and the degree of responsibility of the offender.” [ 163 ] The SCC cautioned that inappropriate and artificial sentences should not be imposed in order to avoid collateral consequences which may flow from a statutory scheme or from other legislation, thus circumventing parliaments will: [para. 15]. [ 164 ] Additionally, the SCC held that collateral consequences must not be allowed to skew the process either in favour of or against deportation.

Nor can those consequences lead to a separate sentencing scheme establishing a range of sentence options where deportation is a risk: [para. 16]. [ 165 ] The SCC further held that if a sentence falls outside of an established range to avoid collateral consequences, then the less likely it will remain proportionate to the gravity of the offence and the responsibility of the offender.

The closer the varied sentence is to the range of otherwise appropriate sentences, the more probable it is that the varied sentence will remain proportionate: [para. 18]. [ 166 ] It may well be that Jiang did not wrap her mind around possible collateral immigration consequences arising from her involvement in the scheme. That being said, she was an integral part of the scheme. She held herself out as an immigration consultant if not in name then certainly in services provided.

She ought to have known, or was willfully blind to the fact, that through her involvement in the scheme, she was putting her permanent residency status in Canada in jeopardy. (

b) Public Stigma Consequences [ 167 ] The accused submitted that the court should take into account the denunciatory impact arising from the publicity surrounding this case. In particular each of the accused has been photographed outside the courthouse and had their pictures and details surrounding their involvement in the scheme published in all aspects of media, including media dedicated to a Chinese audience. [ 168 ] As discussed in R. v.

Samji , 2016 BCPC 145 , at para. 124 , the public stigma which may result from large scale fraudulent schemes would be an expected consequence and would not amount to an exceptional consequence. Indeed, it is the public stigma surrounding large scale fraudulent schemes that would inform the public at large and thereby potentially deter others who may be inclined to participate in a large scale fraudulent scheme. [ 169 ] That said, I accept the submissions of the accused that they have experienced significant stigma arising from the publicity generated by media attention. (

c) Health Consequences [ 170 ] The accused submitted that they have suffered from health consequences arising from the index offences. [ 171 ] They provided sentence authorities in which health consequences were found to be mitigating factors to, in part, justify the imposition of CSO’s in cases involving large-scale immigration frauds: R. v. Ren , 2015 ONSC 3397 and R. v. Al-Awaid , [2015] N.S.J. No. 369 . [ 172 ] In Ren , the accused pled guilty to five of 21 counts of counselling a misrepresentation contrary to s. 126 of the IRPA . After

anxious reflection, MacDonnell J. imposed a CSO of two years less one day. The court found that both the accused and her husband suffered from significant health problems. In particular, Ms. Ren underwent brain surgery to remove a large tumour. [ 173 ] Ms. Ren’s neurosurgeon provided a medical legal opinion in which the doctor opined that a “lengthy period of incarceration would have devastating consequences on Ms. Ren.” MacDonnell J. considered the neurosurgeon’s opinion, but felt that the current health of Ms.

Ren would not justify a reduction in the sentence that would otherwise be appropriate: [para. 25]. [ 174 ] Similarly, in Al-Awaid , the accused pled guilty to eight counts of counselling a misrepresentation contrary to s. 126 of the IRPA and 10 offences under the Citizenship Act . Unlike this case, Mr. Al-Awaid’s clients were already entitled to be in Canada. Derrick P.C.J. imposed a CSO of two years less one day. [ 175 ] Derrick P.C.J. held that she was dealing with a unique set of facts and circumstances surrounding the health consequences for Mr. Al-Awaid should he be sentenced to imprisonment.

The court received compelling medical evidence that Mr. Al-Awaid suffered from a serious heart condition which pre-dated the offences. Derrick P.C.J. was satisfied that were the accused to be sentenced to a prison sentence that there was a uniquely high risk of a hypoglycaemic incident occurring with potentially fatal consequences: [para.152- 154]. [ 176 ] In the psychological assessment prepared by Dr. Bartel, on behalf of Ma, he formed a diagnosis of the presence of an Adjustment Disorder with mixed anxiety and depressed mood.

The onset of these conditions coincided with Ma being charged with the index offences. [ 177 ] His prognosis with regards to Ma’s future mental health was described as “more guarded.” Dr. Bartel explained the impact of stressors on Ma’s future mental health as follows: Should her stressors continue over the long term, it is likely that her psychological condition would worsen and develop into a more serious mental illness, likely major depression. Positively, Ms.

Ma presents with some strong and positive coping skills in order to deal with stress and demonstrates significant resilience that suggests a quick recovery should her stressors lessen. [ 178 ] In the psychological assessment prepared by Dr. Browning, on behalf of Wu, he opined that Wu was “likely suffering from a depression around the time she was charged and has since sought both medical and psychological assistance.” He described Wu’s presentation to be “more stable psychologically since her guilty plea, feeling a sense of relief and some restoration of personal responsibility.” [ 179 ] Dr.

Browning also commented that he found it “hard to see how her family will continue to function if she is incarcerated and unavailable to fulfil her role as a breadwinner and parent.” I do not find this comment to be a psychological opinion but rather an observation by Dr. Browning. [ 180 ] In the psychological assessment prepared by Dr. Bartel, regarding Jiang, he formed a diagnosis that she suffered from a Major Depressive Disorder. The onset of this condition coincided with Jiang being charged with the index offences. [ 181 ] Dr.

Bartel described Jiang feeling some degree of remorse coupled with a high degree of regret. Jiang believes that she was largely a victim of Wang’s influence. [ 182 ] The health consequences suffered by the three accused all coincide with them being charged with the index offences. I must assume these health consequences would not be an issue for the accused if the scheme was not discovered by immigration authorities. Their medical concerns are clearly far less significant than Mr.

Al-Awaid’s medical concerns. [ 183 ] In addition, there is no evidence to suggest that it would be inhumane to impose a conventional prison sentence. In R. v. Nestor , [1998] B.C.J. No. 875 (Prov. Ct.) , a one year CSO was imposed on Mr. Nestor for a serious inventory fraud on behalf of his public company. The court found that it would be “inhumane” to impose a conventional prison sentence given the medical condition of Mr. Nestor. At the time of sentencing, Mr.

Nestor had almost no mobility and was confined to wheelchair, required the use of a catheter multiple times a day, and he had numerous other ongoing ailments. [ 184 ] I have taken into account the individual health consequences for each of the accused should they receive a conventional prison sentence. There is no evidence to suggest that our taxpayer-funded Canadian medical system or correctional authorities would be unable to assist the accused in the event a conventional prison sentence was imposed. (

d) Child Care Consequences [ 185 ] The accused have submitted that they, and their children, will suffer significant child care consequences in the event they are sentenced to a conventional prison sentence. [ 186 ] In particular, Wu is the mother of two young children. Wu is almost entirely responsible for the financial well-being of her family. Jiang and Ma’s daughters are in their mid- teens. The accused are described as the principal caregivers for their children. [ 187 ] Childcare responsibilities are a relevant consideration with respect to sentencing in large-scale fraud cases: R. v.

Lawson , 2016 BCSC 2446 , at paras. 98 and 99 . [ 188 ] The weight to be given to childcare responsibilities, and their collateral consequences in the context of large-scale fraud cases, will vary depending upon the degree of responsibility of the offender and the need to emphasize denunciation and general deterrence in relation to a large scale fraud. [ 189 ] As discussed earlier in this ruling, the accused were integral parts of the scheme. The services they provided to clients were critical to the success of the scheme and ranged over many years. Their involvement in the scheme was largely profit motivated.

Therefore, the weight afforded to their childcare responsibilities is lessened. [190] I have taken into account the childcare responsibilities of the accused in determining a fit and proportionate sentence that is to beimposed. AGGRAVATING AND MITIGATING CIRCUMSTANCES (

i) Aggravating Circumstances [191] The aggravating circumstances can be summarized as follows: • The scheme was a large scale, multi-faceted enterprise; • The high degree of premeditation and participation by the accused; • The accused’s participation in the scheme involved other individuals, including clients, in Canada and China; • Significant state resources were required to investigate and prosecute the accused; • The accused were a party to falsification of government documents and committed identity theft; • The scheme provided a broad range of immigration services to their clients when they were not licensed by CSIC; • The scheme undermined Canadian immigration and tax systems; • The accused were motivated by profit, which is at the heart of the tax evasion charges. (ii) Mitigating Circumstances [192] The mitigating circumstances can be summarized as follows: • The guilty pleas in the face of what would have been a complicated and lengthy trial; • Genuine remorse; • Public stigma; • No prior criminal record; • Their conduct did not amount to a breach of trust; • Their prior good character and reputation, though of reduced weight; • Child care consequences; • Health consequences, though of reduced weight; • Low risk to re-offend.

PRINCIPLES OF SENTENCE [193] The principles of sentence are codified in ss. 718, 718.1 and 718.2 of the Code. [194] The fundamental purpose of sentencing is to contribute to the respect for the law and to promote a just and safe society byimposing stated objectives. [195] These objectives take into account many factors, including denunciation, general and specific deterrence, public safety,rehabilitation, restoration, proportionality, disparities, totality and restraint, and to take into account both aggravating and mitigatingfactors: R. v.

Wust, 2000 SCC 18 , [2000] 1 SCR 455, at para. 20. [196] The case law provides additional guidelines; often in illustrating what an appropriate range of sentence might be in thecircumstances of a particular case. [197] It must be remembered that ranges are guidelines and not “straitjackets” binding a judge to a hard and fast category. It isfundamental in the sentencing process that the principle of proportionality be the primary focus. Sentence ranges are but one toolavailable to determine what is an appropriate sentence: R. v.

Smith, 2017 BCCA 112, at para. 35. [198] All of the index offences are serious offences. In particular, the s. 122(1)(

b) and (

c) IRPA offence attract a potential maximumsentence of 14 years in prison pursuant to s. 123(1)(b). The fraud offence under s. 367(

a) of the Code attracts a potential maximumsentence of 10 years in prison. [199] In R. v. Lin, 2007 NLCA 13 , the accused was sentenced on a single count of using a false passport contrary to s.122(1)(

b) of the IRPA to eight months in prison following a guilty plea. The Newfoundland and Labrador Court of Appeal dismissed theappeal and in doing so the court noted that in 2001 Parliament increased the maximum penalty from two years to 14 years commenting: [6] One of the significant changes was increasing the maximum penalty under section 123(1)(

b) to 14 years from two years. That must

be considered by courts to be a strong indication by Parliament that this offence requires serious punishment … . [200] There is appellate authority in British Columbia, which would clearly suggest that where a 10 year maximum prison sentencepursuant to a Code offence is available that it reflects Parliament’s intention that the offence should be considered as a serious offence:R. v. Fernandez, 1976 CarswellBC 257 (BCCA), at para. 10. [201] In immigration fraud cases deterrence and denunciation are the most important sentencing factors: R. v. Mendez, [2004] O.J. No.5733 (OSCJ); R. v.

Khatchatourou and Reznik, 2012 ONSC 3511, affd. 2014 ONCA 464. [202] In tax evasion cases, specific and general deterrence are the most important sentencing factors: R. v. Klundert, 2011 ONCA 646,leave refused [2011] SCCA No. 512. Custodial sentences are the norm in major tax evasion cases, but CSO’s have been imposed whereexceptional circumstances have been established: R. v. Wilm, supra, at para. 11. [203] In large scale fraud cases denunciation and deterrence have been identified as the most important sentencing factors withparticular emphasis to be placed on deterrence: R. v. Zolnasr, 2011 BCSC 1754 and R. v.

Bogart, (ON CA),2002 CarswellOnt 2537 (ONCA). SENTENCE RANGES (

i) Immigration Fraud [204] Depending on the particular circumstances of the immigration fraud and the particular circumstances of the accused, thesentence range is between the imposition of a CSO and up to a lengthy conventional jail sentence: (

a) CSO • R. v. Ajayi, 2013 ONCJ 747 - 9 month CSO. Accused pled guilty to two counts of immigration fraud relating to a single incidenton July 21, 2012. Offending behaviour at the low end; • Ren, supra, - 2 years less one day CSO. Circumstances serious and offending behaviour ranged over a four-year time frame; • Al-Awaid, supra, - 2 years less one day CSO. Circumstances serious and offending behaviour ranged over many years. Theaccused had significant health issues which predated the offences; • R. v. Large, [2015] B.C.J. No. 1513 - 15 month CSO.

Circumstances serious and offending behaviour ranged over eight years. However, the accused did not forge documents or engage in any fraudulent scheme to allow persons to become permanent residents orcitizens of Canada. (

b) Conventional Jail Sentence • Mendez, supra, - 9 months. The accused pled guilty to a single count of immigration fraud in relation to a false refugee claim bytwo clients; • R. v. Khaira, 2011 ABPC 340 - 14 months. Sophisticated scheme involving counterfeit documentation sent from Hong Kong toCanada; • Khatchatatourou and Reznik, supra, - 4 years each. The accused falsified documentation to obtain fraudulent mortgages includingfalsification of citizenship documents. The scheme was sophisticated and both accused were motivated by profit. There was norestitution; • R. v.

Blanas, 2005 CarswellOnt 8001 (OSCJ) - 5 1/2 years less credit for time served. The accused stole 246 genuine blankpassports from the passport office where she worked. It was the intent of the accused to sell the passports for profit. She was chargedwith breach of trust contrary to the Code and also dealing in blank passports contrary to s. 122(1)(

c) of the IRPA. She pled guilty to theoffences. She had no prior criminal record. The court emphasized general deterrence and denunciation. The nature of the case requireda sentence that engendered respect for the law and the maintenance of a just, peaceful and safe society; • R. v. Wang, Unreported Decision, December 4, 2013, Brampton, Ontario, (OCJ) - 2 years less credit for time served. Accusedparticipated in a scheme to have English proficiency test written by individuals forward in English on behalf of other Chinese studentswhose English was poor.

The accused involvement included retrieving passports from China and transporting them to Canada. Theoverall operation was sophisticated and very profitable. (ii) Tax Evasion (

a) CSO • R. v. Goett, 2010 ABQB 487 - 12 month CSO. The accused was charged under s. 239(1)(

d) of the ITA. Over a period of threeyears he evaded taxes in the sum of approximately $90,000 by filing false returns. The court found that a CSO would be consistent withthe purposes and principles of sentencing; • R. v. Tyskerud et al., 2013 BCPC 277 - 11 and 6 month CSO’s imposed on two accused. The two accused were chargedunder s. 239(1)(

d) of the ITA. They were described as “tax protesters”. The Court was persuaded that a CSO for each accused wouldadequately protect the public; • R. v. LaValley (2015), 132 WCB (2d) 393 (BCSC) - 6 month CSO. The accused was charged under s. 239(1.1)(

a) of the ITA. The accused obtained tax refunds totaling approximately $17,000 by making deceptive returns in which she illegally wrote off personal

expenses as business expenses in a tax consulting business that she co-ran with a partner. The accused’s role was described as a partyrather than a principal to the deception; • R. v. Kueviakoe, 2015 ONCJ 681 - 1 year CSO. The accused was charged under s. 239(1.1)(

a) of the ITA. After the trialcommenced the accused pled guilty to 45 offences for obtaining unusually large tax refunds through fraud. The accused had no previouscriminal history and had lost his job and standing in the community as a result of the charges. (

b) Conventional Jail Sentence • R. v. Bulua, 2006 BCSC 1234 - 30 months jail upheld on appeal. The accused evaded federal income taxes of approximately$415,000 over two years. He was convicted after a trial. The accused was sentenced to a 30 month conventional jail sentence along with100% fine. The sentence was upheld on appeal; • R. v. Andrus, Unreported Decision, September 9, 2013, BCPC - two years coupled with a fine of $400,000. The accused evadedfederal income tax of approximately $675,000 on income earned 10 to 15 years previously. He was convicted after a trial. The courtdeclined to impose a CSO though the accused had health and personal issues. (iii) Fraud (

a) CSO • R. v. Bunn, 2000 SCC 9 - 2 years less one day. The accused was a lawyer who converted trust monies received for thebenefit of beneficiaries from the estates of six deceased persons. The SCC upheld the CSO and found in the particular circumstances ofthe case that the imposition of a CSO provided sufficient denunciation and deterrence and was not disproportionately lenient; • R. v. Burkart, 2006 BCCA 446 - 18 month CSO imposed in substitution of a conventional jail sentence. The accuseddefrauded a financial institution of approximately $81,000 when she was in a management position over 15 years.

She was involved ingambling at casinos. The Court of Appeal substituted a CSO noting that in the circumstances of Ms. Burkart the imposition of a CSOwould better recognize the purpose of the legislative scheme; • R. v. Dickson, 2017 BCCA 561 - 12 month CSO imposed in substitution of a conventional jail sentence. The accusedwas a bookkeeper who pled guilty to two counts of theft involving approximately $147,000. She forged signing authority signatures anddestroyed original checks.

The accused suffered from a pre-existing bipolar disorder, she pled guilty, she made full restitution and wasreceiving appropriate medical treatment. In those circumstances the principles of general deterrence and the ends of justice were met bythe imposition of a CSO; • R. v. de la Boursodiere, 2011 BCCA 300 - 6 months upheld. Accused convicted of fraud under $5000 and forgery. Theaccused provided medical treatment in that the nature of massage and reflexology treatment to patients. On one occasion she forged hersignature to a document and then submitted that document with a false claim to the insurance company.

The accused submitted that aconditional discharge was the appropriate sentence having regard to the accused’s background and her offending behaviour. The trialjudge imposed a six-month CSO which was upheld by the Court of Appeal; • R. v. Offman, 2017 BCPC 70 - 2 years less one day. The accused was a constituency assistant to an elected member ofthe legislative assembly of British Columbia. Between 2005 and 2016 the accused defrauded the legislature of a proxy $120,000through the alteration of checks and other financial documents. The accused was emotionally fragile at the time of sentencing.

She pledguilty and was genuinely remorseful. (

b) Conventional Jail Sentence • R. v. Dickens, 2003 BCSC 535 - 3 years. The accused pled guilty to theft of approximately $173,000. The schemeinvolved the alteration of manual checks. The offender was in a position of trust. General deterrence was the Paramount sentenceconsideration; • R. v. Reid, 2004 YKCA 4 - conventional jail sentence of 14 months in substitution of a CSO. Accused was the headcashier at a grocery store. She stole approximately $212,000 over a three-year period by manipulating the end of the day bank deposits.

The Yukon Court of Appeal emphasized the need for denunciation and deterrence for this type of crime. The court was of the opinionthat an appropriate sentence would have been in the range of 2 to 3 years, but because of intervening circumstances a sentence of 14months was imposed; • R. v. Dreger, 2014 BCCA 54 - jail sentence of five years reduced to four years for the failure of the trial judge to giveappropriate weight to the guilty plea. The accused bookkeeper defrauded her employer of approximately $245,000 over a period ofseven years; • R. v. Rands, 2005 BCPC 264 - 2 years less one day.

Accused and his partner, both pharmacists, owned two pharmacieswhich catered to drug addicts involved in the methadone maintenance program. The accused’s partner falsely billed the provincialPharma Care Program. The accused was aware of his partner’s deceit but did nothing to prevent it. Indeed, he shared in the profits thatwere falsely billed. The amount of the fraud was $470,000. The accused pled guilty. The court found that the circumstances requiredan emphasis on deterrence and denunciation as particularly pressing objectives.

A CSO would not be consistent with fundamentalpurposes and principles of sentencing. SENTENCE TO BE IMPOSED [205] The circumstances surrounding the index offences are very serious. The scheme in which the accused were involvedundermined the integrity of our immigration and tax systems.

[206] I am satisfied that a term of imprisonment within the provincial range is required to properly address the principles of generaldeterrence and denunciation and, to a lesser degree, specific deterrence. [207] The accused have not argued that a term of imprisonment should not be imposed. Rather, they have submitted that with theimposition of strict conditions that the sentence could be served as a CSO by operation of s. 742.1 of the Code. [208] In R. v.

Ash, 2010 BCCA 604, at para. 11, the Court of Appeal addressed the requirements for the imposition of a CSO: It is useful first to refer to the Supreme Court of Canada's decision of Proulx.

In Proulx Chief Justice Lamer recognized the four criteriain s. 742.1 of the Criminal Code governing the imposition of a conditional sentence: 1) that the offender is convicted of an offence that isnot punishable by a minimum term of imprisonment; 2) that the court must impose a term of imprisonment of less than two years; 3) thatthe safety of the community would not be endangered by the offender serving the sentence in the community; and 4) that a conditionalsentence would be consistent with the fundamental principles of sentence set out in ss. 718 and 718.2 of the Criminal Code.

ChiefJustice Lamer (at para. 47) referred to the first three criteria as prerequisites to any conditional sentence, and observed that the fourthconsideration refers the judge to the fundamental purpose and principles of sentencing. [209] I am satisfied that it is the fourth requirement that is at issue in this case. [210] If a CSO is available for an offence, then it is clear that no category of offence is excluded from the CSO regime.

Specifically, aCSO is a possible sentence in a large-scale fraud case: Bunn, supra, and Burkart, supra. [211] However, it is also clear that certain offences will usually lead to a conventional jail sentence. There may be circumstanceswhere the need for denunciation or deterrence is so pressing that a conventional jail sentence will be the only suitable way in which toexpress society’s condemnation of the offender’s conduct or to deter others from similar conduct in the future: R. v. Proulx, 2000 SCC 5,at para. 127(8). [212] The Ontario Court of Appeal in R. v.

Dobis, (ON CA), 2002 CarswellOnt 575, at para. 51, emphasized thatgeneral deterrence is central to the sentencing process in cases involving large scale frauds with serious consequences for the victims. Importantly, the Ontario Court of Appeal has taken the same position since the introduction of the CSO regime. This position wasapplied by our Court of Appeal in R. v. Khan, 2002 BCCA 703, at para. 11. [213] I appreciate that Jiang is in a particularly precarious position due to her collateral immigration consequences.

However, it wouldbe a patently unfit sentence, whether within a CSO or a conventional jail sentence, to impose a prison sentence of six months less oneday. To do so would essentially skew the legislative intent of the IRPA. [214] I also appreciate the childcare consequences that face the accused, in particular Wu, who is the mother of two young children. Ihave given childcare consequences considerable weight in determining a fit sentence for the three accused. [215] The collateral health consequences for the accused developed only after they were caught breaking the law.

Their diagnoses ofstress, depression and anxiety are not surprising but do not elevate the health consequences into a category where serious harm, or evendeath, could result from the imposition of a conventional jail sentence. [216] I have taken into account that the conduct of the accused did not amount to a breach of trust in the legal sense. [217] The accused are persons of prior good character and reputation as evidenced by the letters of reference filed on their behalf.

Similarly, the laying of the index offences and subsequent media attention has stigmatized the accused’s reputation in their community. [218] I have taken into account the fact that Wu and Jiang made restitution to the CRA. Ma has not made restitution though isprepared to consent to any orders requiring that she make restitution to the CRA. [219] I have taken into account the fact that they do not have any prior criminal record, though there is authority in relation to “whitecollar crime” that the lack of a criminal record is not a mitigating factor: R. v.

Wilder, 2004 BCSC 644, at para. 72, applied Bulua,supra., at para. 103(18). [220] The accused have entered guilty pleas which are a significant mitigating factor. I give considerable weight to their guilty pleas. [221] Similarly, I give considerable weight to their genuine remorse. [222] The aggravating circumstances summarized at paragraph 191 of this ruling are significant and serious. The scheme was a large-scale, multifaceted enterprise. Wang could not operate the scheme without the assistance of the accused.

While it was clear that Wangwas the mastermind of the scheme, I do not find there is evidence that would establish they were dupes of Wang. [223] The scheme ranged over many years with clients of Newcan and Wellong illegally achieving permanent residence status, and insome cases citizenship status, with all of the benefits that flow from being a permanent resident or a citizen of Canada. [224] Likewise, the circumstances surrounding the accused’s tax evasion and the making of false or deceptive statements resulting inthe payment of Canada Child Tax Benefits are significant aggravating factors in this case. [225] I have taken into account each of the accused’s personal circumstances.

I have also taken into account their individual roles inthe scheme. In balancing those factors, I do not find that there is a sufficient basis that would justify any disparity in sentencing of theaccused. [226] Additionally, in relation to the overall sentence to be imposed, I have taken into account the totality principle which was restatedin R. v. Au, 2006 BCCA 533, at para. 42. I find that the sentences to be imposed on the accused do not exceed the overall culpability ofeach of the accused.

[ 227 ] I conclude that it is pressing that deterrence and denunciation must be emphasized to protect society at large from the grave danger posed by those who may be inclined to engage in conduct similar to that of the accused.

This pressing need militates against the imposition of a CSO. [ 228 ] In relation to the IRPA offences and the Code fraud offence each of the accused are sentenced to a conventional jail sentence of 12 months, each count concurrent to the other. [ 229 ] The Court of Appeal in the Wang appeal decision, at para. 4, confirmed that the IRPA offences were separate endeavors from the personal tax offences. I find that consecutive sentences are necessary in this case.

Each accused is sentenced to a consecutive conventional jail sentence of 6 months on each of the two counts but concurrent to each other. [ 230 ] The total sentence to be served by each of the accused is 18 months in a Provincial Correctional facility. [ 231 ] I did not hear submissions on the Victim Surcharge. The index offences bridge the amendments to the Victim Surcharge legislation. I decline to impose the Victim Surcharge. [ 232 ] The accused have not disputed the proposed fines noted at paragraph 109 of this ruling. Those fines shall be imposed.

The accused will have three years to pay the fines. _____________________________ The Honourable Judge G. Rideout Provincial Court of British Columbia