Taxman defeats Winston Blackmore, polygamous leader of Bountiful

Macleans Magazine, Canada/August 28, 2013

By Ken MacQueen

The leaders of the breakaway fundamentalist Mormon sect of Bountiful, B.C. have managed to avoid a successful criminal prosecution in all the years since it was founded in the mid-1940s, while openly practising polygamy and despite troubling allegations of forced underage marriages and child sexual exploitation. But that run of luck has ended for Winston Blackmore, its high-profile bishop.

In the end, shades of Al Capone, it was the taxman who did him in—and more trouble may be on the horizon.

In a Federal Tax Court ruling released this week, Justice Diane Campbell rejected Blackmore’s claims that the community of Bountiful, or at least the portion recognizing his leadership, constitutes a communal religious organization eligible for tax exemption. Campbell ruled that Blackmore underreported his income by some $1.8 million during a five-year period starting in 2000, a time when his declared annual income rarely exceeded $30,000. Not only will he have to pay taxes on the higher amount, he faces a penalty of almost $150,000 for hiding his income.

“Although there was no direct evidence that would lead me to conclude that the appellant knowingly made these false statements or omissions in his returns,” Campbell ruled, “there is abundant evidence that supports my conclusion that he ought to have known that he was misrepresenting his income.”

This was not your typical tax court case, to put it mildly.

The case was finally heard in early 2012 after frequent delays and a failed attempt by Blackmore and his legal team to win a sweeping ban on evidence, publication and some witness testimony. In the end he gave his own testimony under subpoena as a “compelled witness” with the expectation that his statements in this civil case can’t incriminate him in any future criminal trials.

Blackmore arrived each day at the Vancouver courtroom during the four weeks of hearing wearing a natty black suit and clutching a black-bound Book of Mormon. Campbell and federal Justice Department lawyers were bound by an equally unbending tome: the Canadian Income Tax Act.

“These appeals introduced unique and novel legal and factual issues that are not normally before this court,” Campbell wrote with judicial understatement. She wrote how she had to acquaint herself with the intricacies of Mormonism, Episcopal polity and apostolic success. “Many terms, such as ‘The Priesthood Work,’ ‘United Effort Plan,’ or ‘United Effort Plan Trust,’ ‘Law of Consecration’ and ‘Tithing’ were either completely new to me or I had no working knowledge of them.”

Her patience was tried by Blackmore’s often evasive or vague answers, and his convoluted spiritual explanations, frequently delivered sotto voice. He grudgingly admitted to having 21 “plural wives,” though he had trouble remembering the name of at least one. He fathered 47 children during the five years under review, which may help explain his inattention to the intricacies of the tax act. By some estimates he has more than 120 children.

Bountiful doesn’t appear on any B.C. map. It is the name that the fundamentalists call the community based at Lister, just a kilometre north of the U.S. border and seven kilometres from Creston, where some of the sect’s business dealings are based. Many operate under the Blackmore-controlled company J.R. Blackmore and Sons, which include several fencepost-manufacturing plants in B.C. and Alberta, as well as various logging and farm-related operations.

The Blackmore companies generate millions in revenue, and while they employ many members of the sect, much of their salary is often required to be handed back to the church. This prompted Justice Department lawyer Lynn Burch to remark during the trial that if Blackmore sees himself as a spiritual leader, “the role of a good shepherd is to shear a sheep, not skin it.”

Justice Campbell was not sold either on the idea that Blackmore was leading what constitutes a church under the tax act. “I have concluded that members of the community of Bountiful are not members of any religious organization but are a group of independent Mormon fundamentalists,” she ruled.

The judgment leaves Blackmore to deal with a hefty tax bill at a time when Bountiful remains bitterly divided. The community of some 1,500 split in 2002, with half following Blackmore’s leadership while the rest remained with the even more hard-core leadership of the Fundamentalist Church of Latter-Day Saints.

Another shoe may yet drop for the embattled community. The provincial government appointed lawyer Peter Wilson as a special prosecutor to look yet again at the possibility of laying criminal charges dealing with the forced marriage of underage “celestial wives.” Previous attempts have gone nowhere, often because of constitutional guarantees of freedom of religion under the Charter of Rights and Freedoms.

Wilson has been studying the file for almost 20 months now with no word when, or if, charges are likely. The Constitution, it seems, has even more loopholes than the Income Tax Act.

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