Patriarch of Mafia clan pleads guilty to tax evasion, settles debt, walks free

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MONTREAL - The grandpa in Canada's most notorious Mafia family pleaded guilty to tax evasion, settled his debts with the tax man, and strolled out of a courthouse wearing a smile and a fedora hat.
It took less than 15 minutes in a courtroom Thursday for octogenarian Nicolo Rizzuto to walk out a free man. It had taken more than 15 years to bring his tax case to court.
The case stems from infractions committed in the mid 1990s by Rizzuto, the father of reputed Mafia boss Vito Rizzuto and grandfather of the recently murdered Nick Rizzuto Jr.
He admitted failing to declare interest revenues from more than $5 million deposited in a handful of Swiss bank accounts.
In 1994 and 1995, Rizzuto earned $627,906 in interest from the foreign accounts and didn't declare it. Police uncovered the Swiss accounts in the mid-'90s, but didn't pursue the case.
Tax authorities only discovered the accounts when Rizzuto was swept up in a massive police dragnet against organized crime in 2006, Project Colisee, in which he and scores of others were arrested.
"Revenue Canada became interested in Mr. Rizzuto because of Projet Colisee," Crown prosecutor Yvan Poulin told reporters outside the courtroom.
"The agency got interested in the case - and dusted off, if you will, its old files."
While Rizzuto could technically have faced jail time, prison sentences are rare in such cases, Poulin noted.
An investigation against Rizzuto in the 1990s was led jointly by authorities in Switzerland and the RCMP in Canada.
In September 1994, authorities detained Nicolo Rizzuto's wife, Libertina Manno-Rizzuto, in the banking town of Lugano, near the Italian border. She was held for a six months before being released without charges.
The file then remained dormant for 12 years, until the Project Colisee investigation. Charges were finally authorized by a judge on Feb. 1 - just over a week ago.
In a statement Thursday, the Canada Revenue Agency said Rizzuto paid a $209,000 fine and also settled his tax debt of about $154,000.
The fine represents 135 per cent of the federal tax he owed.
Rizzuto also settled a civil case against him with the provincial and federal tax agencies for an undisclosed amount.
"The CRA is firmly committed to preserving the integrity of Canada's tax base and prosecutes taxpayers who deliberately try to avoid declaring their income from all sources and paying tax on that income," the agency said.
The surprise plea was entered during a scheduled appearance in Quebec Court before Judge Jean-Pierre Bonin.
Rizzuto quietly exited the courthouse, and his lawyer said simply that he was pleased the case had been settled to everyone's satisfaction.
The tax-evasion case is only the latest in a string of woes for the Sicilian clan.
The family's most powerful figure, Vito, is in a U.S. prison for racketeering; barely a month ago the clan gathered for the funeral of Nick Rizzuto; and four other family members have an unrelated case before the Tax Court of Canada.
Media reports this week indicated the family is also the subject of an insider-trading investigation in Italy, related to allegations of an elaborate fraud scheme worth about $21 million.
After his arrest in the 2006 dragnet, Nicolo Rizzuto pleaded guilty to possessing goods obtained through criminal gains and possession of proceeds of crime for the benefit of a criminal organization.
The octogenarian family patriarch, who turns 86 next week, is already on probation after receiving a suspended sentence in 2008 for his previous crimes.

Organizations: Canada Revenue Agency, RCMP, Tax Court of Canada

Geographic location: Canada, MONTREAL, Switzerland Lugano Quebec Court U.S. Italy

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