CRA Paid Over $10 Million to Ontario Ironworker in Sovereign Citizen Tax Scheme
A CBC Fifth Estate investigation found that the Canada Revenue Agency deposited more than $10 million in fraudulent refunds to an Ontario ironworker who had called the agency to outline his scheme. Internal records link nearly $300 million in bogus claims to the same conspiracy-driven tax strategy.
An investigation by CBC’s The Fifth Estate has revealed that Jonathon Pearce, an ironworker from Temiskaming Shores, Ontario, received more than $10 million in fraudulent tax refunds from the Canada Revenue Agency (CRA) after filing bogus returns rooted in “sovereign citizen” conspiracy theories.
Pearce filed false tax returns claiming he was owed refunds totaling more than $40 million. The CRA began issuing payments just two weeks after the returns were filed. On July 21, 2023, Pearce contacted a CRA call centre and outlined both his tax scheme and his conspiracy beliefs. Despite that call, the agency deposited a first instalment of slightly less than $500,000 on July 31, 2023, followed by a $10-million deposit on Aug. 8, 2023.
Further scheduled instalments of $10 million and $20 million later in August 2023 were halted only after Pearce’s bank alerted the CRA to the unusual payments. The agency subsequently scrambled to recover the funds, garnishing Pearce’s wages, but was still searching for more than $1 million that had been spent or gone missing.
Internal CRA records indicate the scope of the problem extended well beyond Pearce. Between May 2023 and January 2024, nearly $300 million in bogus claims were linked to the same tax scheme. Nineteen social insurance numbers were connected to the specific fraud.
Critics have pointed to significant gaps in the agency's fraud detection processes. Former CRA investigator Shawna Roy criticized the agency for lacking validation processes to verify the legitimacy of requested refunds. Finance Minister François-Philippe Champagne stated he was unaware of the specific allegations regarding the sovereign citizen tax refunds. Heather Evans was appointed commissioner of the Canada Revenue Agency on July 13, 2026.
The CRA is pursuing other individuals allegedly involved in similar schemes. Teresa Wallace allegedly received a bogus $5-million tax refund in 2024, which the agency is attempting to recover. A search warrant dated May 23, 2026, authorized a CRA search of Bernard Yankson’s home, alleging tax fraud by counselling others to make false statements on tax returns. The agency has also launched criminal investigations into at least two sovereign gurus in the Vancouver area, including AJ DeSwart.