A Montreal charity that helped bring Syrian refugees to Canada was fined $60,900 for providing “undue benefits” to a company owned by its president as part of its sponsorship program, according to documents recently made public.

The Canada Revenue Agency (CRA) notified the Centre Canadien Islamique Al-Jamieh/Canadian Islamic Centre Al-Jamieh of the penalty in a Sept. 12, 2024 letter, which has now been made available through the IJF’s Open by Default database.

The notice says the mosque, a registered charity, paid $58,000 to a consulting company in March 2017. That company was wholly owned by the charity’s then-president, Ahmad Chaar.

The mosque told the CRA that this payment was made to reimburse Chaar’s company for refunding deposits paid by would-be refugees who withdrew from the sponsorship program, or whose applications were denied by immigration officials.

“The organization, however, did not provide documentation to support its claim that the payment was a reimbursement, and that it did not use the organization's resources to benefit a party not dealing at arm's length with an official of the organization,” the notice says.

Chaar told the IJF he and the other leaders of the centre did not agree with the tax agency’s findings, but decided to pay the penalty without contesting the allegations.

“We have no other alternatives, because they put us in a corner,” he said in an interview. He added that his company did not profit from the arrangement, and only became involved after the charity’s bank in the Middle East declined to make the reimbursements.

A 2021 audit notice attached to the penalty letter notes that the $58,000 that was paid to Chaar’s company exactly matches the amount deducted from refugee applicants’ deposits for administrative fees during the audit period.

Auditors said they found that to be “more than coincidental” and suggested it was evidence Chaar had used the charity’s money to pay for work by his own company.

In correspondence with the organization, tax officials wrote “it remains the CRA's position that Mr. Ahmad Chaar failed to exercise his fiduciary duties as the president of the organization in the administration of this program, which resulted in the loss of charitable assets.”

Penalties for undue benefits are assessed at 105 per cent of the benefit provided, which is how the $60,900 fine was calculated. Charities can pay a financial penalty directly to the CRA or by making a gift of that amount to another registered charity.

According to the notice, the mosque ended its refugee sponsorship programs after being informed by the CRA that it was not compliant with legal requirements.

The charity also agreed to a compliance agreement with the CRA to address other issues identified during the audit process. Much of the agreement is redacted in the document obtained by the IJF, but the terms included removing Chaar as president and board member.

Chaar declined to provide further details about the agreement, but confirmed he has resigned after a quarter century with the organization.

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