It was a big year for Anthony Melman.
In 2007, the well-known Bay Street financier and partner at private-equity firm Onex Corp. was preparing for retirement from the firm, winding up certain business affairs and collecting millions of dollars worth of dividends from two holding companies he controlled.
Mr. Melman, described in federal tax court documents as "meticulous" and "exacting," had been pressing his accountants for advice, demanding "that response times from his advisers … be measured in minutes and hours rather than days."
But the documents show he wasn't meticulous enough when it came to his tax liabilities – a costly oversight that would pit him against the taxman and led to his resignation this week from the board of one of Canada's largest companies.
Canadian Pacific Railway Ltd. announced late Tuesday that Mr. Melman had decided to leave its board after the Tax Court of Canada ruled earlier this month that he was negligent for not reporting $18.85-million of taxable dividend income in his 2007 tax return.
Mr. Melman testified that, in April of 2008, he signed his tax return at his home while a taxi waited outside to take the junior accountant who delivered the papers for Mr. Melman's signature back to her office. Mr. Melman said he was on his way out of town and that he didn't review or read the documents he signed.
The discrepancy was staggering. Instead of reporting $18.85-million in taxable dividend income on his 2007 tax return, Mr. Melman declared only $2,582. His taxes due that year were calculated at $367,000, rather than $4.7-million. (Notably, court documents show that Mr. Melman had set aside about $4.7-million in short-term securities with a maturity dated to coincide with the tax deadline.) Story
CP's CEO shuffle
Canadian Pacific Railway Ltd. chief executive officer Hunter Harrison will hand over the controls of the country's second-largest rail carrier to long-time protégé Keith Creel next year in a much-anticipated succession.
Mr. Creel, currently CP Rail's president and chief operating officer, will take over from Mr. Harrison when he retires on July 1, 2017. The move is expected to bring little change in operating philosophy, as the two have worked together closely at three different railway companies over two decades. Story
Brookfield looks to India
Brookfield Asset Management Inc. plans to invest about $1-billion in Indian distressed assets through a joint venture with the largest lender in the South Asian nation where banks are battling a record $120-billion of sour debt.
Brookfield and State Bank of India have signed a preliminary agreement to set up a joint venture for the investments, the firms said on Wednesday. SBI aims to contribute up to 5 per cent of the total investments targeted by the venture, which may also rope in other banks at a later stage, they said. Story
ON THE MOVE
Morgan Stanley picked its global head of metals and mining, Richard Tory, to lead investment banking operations in Canada, Bloomberg reported. Story
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