Benoît Laliberté in cryptocurrency | Exploiting loopholes thanks to the blockchain

Like many other IT entrepreneurs, Benoît Laliberté is trying to take advantage of the enthusiasm for technologies based on blockchains (blockchains). In Florida, he is setting up a company that plans to sell properties in the form of non-fungible tokens.


“I go to bed at night and then I say to myself: ‘Am I still 45 too early?’ The answer may be yes…”, says Laliberté.

Basically, his company HouseBit plans to set up trusts to buy condos and houses. Once the acquisition is complete, the “trust” is divided into 1,000 shares, to which correspond as many tokens, put up for sale to the public.

HouseBit is registered in Delaware, recognized as a small American tax haven.

“Rather than having Hugo Joncas, Benoît Laliberté or Jos Bleau, the beneficiaries of the residential trust are expressed in the form of ‘smart contracts’”, he explains.

Anyone can buy one of these 1000 smart contracts to own a share of the building.

HouseBit must also sell another type of token, unique this one, which instead allows the buyer to occupy the property, provided that they also pay the charges usually associated with a home: insurance, condominium charges, rent, etc.

For now, the HouseBit site only features one property for sale as non-fungible tokens: a condo at 21e floor of a tower in downtown Miami.

According to the company’s site, each of the 1,000 property tokens is sold for US$397, and the one that grants the right to occupy the dwelling costs US$16,800.

Laliberté specifies, however, that he has already concluded such transactions on “several” properties, which are no longer for sale. How many ? “More than one, less than ten,” he replies.

Avoid Securities Laws

But what is the benefit of transferring ownership into non-fungible tokens? Laliberté explains that his system will make it possible to buy a fraction of a home, directly online.


PHOTO SUSAN STOCKER, SPECIAL COLLABORATION

Benoît Laliberté in his offices in downtown Miami

But above all, it will make it possible to take advantage of loopholes, “of loopholes », Explains the businessman himself.

According to him, US securities laws do not apply to these non-fungible tokens.

“With our prosecutors here, we created this vehicle, which does not become a security. Why ? Because the asset is directly held by a trust and there is no business in between, explains Laliberté. There’s not even HouseBit in between. It is a direct link between the asset and the trust. It belongs directly to the token holders. »

Bypass tenant protection

The businessman is also convinced that his concept will allow HouseBit to circumvent laws aimed at protecting tenants.

Whether it’s in any jurisdiction in Canada, then in the United States, you know, there are housing authorities, there are here, there are that… We work with digital assets , so it’s a perpetual right of occupation, but it’s not linked to a lease.

Benoit Laliberte

If the holder of the “occupancy token” fails in his monthly obligations, he loses his right to live in the accommodation, he explains. “But it’s governed by a digital asset and not by commissions, or the court, or housing authorities. »

Isn’t this a way to circumvent all the laws that would normally apply?

” It’s a loophole. A loophole, it’s legal! said Laliberté by way of justification. But I don’t like the term “bypass”. »

An acrimonious conflict with his ex-partner in bitcoins


PHOTO MARTIN CHAMBERLAND, LA PRESSE ARCHIVES

Benoît Laliberté had these four imposing structures built to house bitcoin mining machines on agricultural land belonging to AgroDômes in Sainte-Marie-Madeleine, Montérégie.

In Montérégie, Benoît Laliberté made headlines in 2018 with his bitcoin mining project on agricultural land. Four years later, the adventure ended in an acrimonious dispute.

His former partner, the Californian Bit Intelligence, had to go to court to recover 1,684 bitcoin mining machines she had entrusted to him. The company suggests in a lawsuit that Laliberté may have used this equipment to pocket hundreds of thousands of dollars in cryptocurrency without right.

In collaboration with another American company, Bit Intelligence was to install bitcoin computers on agricultural land in Montérégie belonging to AgroDômes, one of the many companies controlled by Laliberté.

Even before signing a contract, Bit Intelligence shipped its machines to Sainte-Marie-Madeleine, between Mont-Saint-Hilaire and Saint-Hyacinthe, in the fall of 2021. Laliberté had four vast white domes built there to house the computers and planned to heat greenhouses with the heat they give off.

As part of a due diligence of its partner, AgroDômes however had to admit that the Commission for the Protection of Agricultural Lands of Quebec (CPTAQ) had ordered it to cease its activities on its land. The organization believed that the company’s main mission was bitcoin mining, not greenhouse farming.

Noting that the project was unlikely to go ahead, Bit Intelligence asked AgroDômes to return its machines to it in December 2021. The company Laliberté controls instead sent it an invoice for more than 44 million, claiming that it prematurely ended their “agreement”. In the meantime, she invoked her “right of retention” of the machines.

Attempted “extortion”, says the former partner

The two companies have however “never signed an agreement of any kind”, assures the Californian company in a request to recover its property in Superior Court. “This constitutes a blatant attempt by AgroDômes to use the machines belonging to Bit Intelligence, worth nearly 13.5 million US, as leverage to extort sums that are not due to AgroDômes”, claims Bit Intelligence .

In its lawsuit, the company points out that “the machines have not produced bitcoins for Bit Intelligence since December 31, 2021, which implies that the machines must have been turned off”, unless “their mining capacity has been diverted”. Estimated value of this cryptocurrency: US$504,000 per working month.


PICTURE FROM AMAZON

A Whatsminer M31S bitcoin miner, like the ones Bit Intelligence had to seize at AgroDômes

Bit Intelligence finally obtained the seizure of its machines on March 17. In her report, the bailiff specifies that “the major part, that is to say 1569 minors, were connected and in function”.

Laliberté is now asking for the revocation of the judgment ordering the seizure of the computers.

“He is stronger than the taxman”


PHOTO SUSAN STOCKER, SPECIAL COLLABORATION

Benoît Laliberté in his offices in Miami

For a former partner in a large Montreal insolvency firm, the case of Benoît Laliberté shows how certain particularly well-organized businessmen can exploit the flaws in the system.

“This guy has access to better advisers than the state,” says Réjean Bouchard, now a semi-retired trustee. He has access to more services than people from Revenu Québec. He is stronger than the taxman. »

After a tax bankruptcy of 56 million, Mr. Laliberté ceased to be a tax resident of Canada. Eleven years later, he paid $100,000 of his debts. Despite everything, he continues to be in business in Quebec and the United States under the beard of the government, thanks to trusts and companies in the British Virgin Islands, as reported The Press Monday.

“It’s insulting to everyone who pays their taxes, but it lives alongside society. He does things well… He’s a genius! », says Réjean Bouchard.

He understands the inertia of the firm in charge of Mr. Laliberté’s bankruptcy, since the trustee Primeau, Proulx and Associate remained without instructions from his government creditors for nine years.

This guy is an eel. He traveled to the islands in the South, with an office in Miami. What do you want a bankruptcy trustee in Longueuil to do with a guy who isn’t even a Canadian citizen anymore, neither fiscally nor legally?

Réjean Bouchard, semi-retired trustee, former partner in a large insolvency firm

He notes the presence of three female lawyers during the interview conducted by The Press with him, reported Monday. “When someone has the means to organize themselves the way they organized themselves, it’s practically untouchable. »

The opposition wants tougher measures

Québec solidaire and the Parti Québécois deplore the inertia of the tax authorities in this affair.

“The case of Benoît Laliberté is another completely frustrating example of the need to implement strong measures to counter tax evasion, recover the amounts owed and reinvest them in services to the population,” said the leader of the Party. Quebecer, Paul St-Pierre Plamondon.

It invites the government to take stock of the tax losses caused by tax havens.

In Quebec solidaire, the new deputy Haroun Bouazzi wishes “a collective reflection” on the question.

Unfortunately, as long as our governments tolerate the existence of tax havens and opaque corporate structures that have completely deviated from the original purpose of the “legal personality” of companies, cases of white collar fraudsters will continue to multiply.

Haroun Bouazzi, MP for Québec solidaire

The Liberal Party of Quebec did not answer our questions.

Always radio silence in the government

In Quebec as in Ottawa, the governments always refrain from commenting on the case of Mr. Laliberté and their inaction for a decade in the face of his tax bankruptcy.

Revenu Québec simply did not call back The Press. The Minister of Finance, Eric Girard, head of the agency, once again refused our request for an interview.

“All information relating to the investigations as well as their duration cannot be commented on or shared,” said its press officer Claudia Loupret in an email.

Revenue Canada did not answer our questions either, citing the confidentiality of taxpayer records.

Precision

JAAM and Louis-Philippe Beaudoin Residence Trust

In the box “More than 8 million in real estate” which followed the article “Over 56 million owed to the State… for 11 years”, we wrote that the Fiducie Résidence JAAM owned the Pompano Beach bungalow jointly with a company by Louis-Philippe Beaudoin. This information came from a record in the Broward County Land Registry. This public document is in fact erroneous, according to a lawyer for Louis-Philippe Beaudoin. His company Placements LPB USA inc. remains the sole owner of the house. The Trust signed a deed of purchase in 2019, but the seller granted it a seller’s credit and officially remains the owner of the house until the agreed total sum of US$936,000 is paid to it, which does not is still not the case.

The Press

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