January 29, 2023

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$50M lottery winner hit with border fine for undervaluing imported classic car

A $50-million lottery winner and prize-winning classic car collector was hit with a $10,000 fine for trying to undervalue a car he was importing at the border between Michigan and the Sarnia area.

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SARNIA – A $50-million lottery winner and prize-winning classic car collector was hit with a $10,000 fine for trying to undervalue a car he was importing at the border between Michigan and the Sarnia area.

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Timothy Schell told Canada Border Services Agency officers stationed at the Blue Water Bridge last summer he paid US$70,000 for the mint-condition red 1969 Chevrolet Camaro locked in his trailer. An investigation, though, found Schell, who was featured in the National Post in May 2012 after winning the eight-figure Lotto Max draw, actually paid more than US$126,000.

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The Toronto-area man was hit with a civil tax bill of more than $33,500, which he paid on the spot, and he’s now been handed the $10,000 penalty in a Sarnia courtroom after pleading guilty to one charge of willfully evading or attempting to evade the payment of duties under the Customs Act.

“Mr. Schell, the rules apply to everyone,” Justice Mark Poland said. “The reality is being sneaky at the border on an importation of this character is simply not worth it.

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“If you decide to run the risk of trying to pull one over on the border services folks and you are not successful in it, then you’re going to pay for it – and you’re going to pay dearly.”

The court heard Schell arrived at the international crossing around 2:15 p.m. on June 26 and gave a border officer details and documents, including a bill of sale, related to the car he was importing. He told the officer he’d bought the ’69 Camaro in 2018 for US$70,000 but wasn’t able to go get it and bring it back until that Sunday afternoon – he’d been in Carlisle, Pa., for the Carlisle GM Nationals car show – due to the pandemic.

Schell already owned 19 Camaros built that year, according to a 2019 feature in Motor Trend detailing the 50th anniversary of that model.

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The officer, however, was suspicious the valuation of the car was off and noted the Keswick, Ont., resident seemed nervous since he was fidgeting and pacing around the lobby, although his lawyer later said he was simply worried. Two officers went with Schell to take a look at the car, which had a completely clean underside and a brand-new engine under its racing-style hood.

“Once (the officer) observed the car, he knew there was a high probability that the declared value was inaccurate,” federal prosecutor Brian Higgins said while reading an agreed statement of facts. “Everything on the vehicle appeared to be in brand-new condition.”

When asked again about the purchase price, Schell said he paid US$70,000 in a wire transfer, so the officer asked the former Guelph resident to pull up his Royal Bank of Canada smartphone app and show him the transaction. He showed proof he sent $70,034.51 to the seller on Aug. 9, 2018.

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But one week later, there was a second transfer of $30,034.24 and, three months later, a third amount sent totalling $26,034.04.

Schell, who recently won the Chief Judge’s Choice award for a red 1969 Chevrolet Yenko Camaro at the Cobble Beach Concours d’Elegance car show in Georgian Bay, initially appeared confused about the other two transactions. The officer, though, confronted Schell about the extra $56,000 and pointed out the total value being declared includes any work or modifications.

“Well I guess I paid $126,000,” Schell finally admitted.

Schell was arrested and put in a holding cell at the border before being released on a promise to appear with a pair of Customs Act charges. Schell, who had no prior record, told the judge this week he didn’t have much to add beyond what the prosecutor and his lawyer said.

“The story is pretty black and white,” he said. “I am, I guess, pleading guilty to what I have done and that’s that.”

The second charge was dropped after his guilty plea.

Both lawyers suggested the $10,000 fine on top of his tax bill, which Higgins said should send a message to the public it’s not worth it to try to undervalue something being imported.

“Because there are large civil penalties involved and there is also a strong possibility of Customs Act charges, a conviction for those and a significant fine,” the prosecutor said.

[email protected]

@ObserverTerry

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