Human traffickers racked up $60K in debt under her name; the CRA is compounding her trauma

For more than a year, the Canada Revenue Agency has failed to help a survivor of human trafficking working to take her life back.

Cassandra Harvey has been left struggling financially to support her two young daughters and rebuild her life after experiencing devastating trauma at the hands of numerous traffickers who racked up more than $60,000 of debt in her name. This included fraudulent benefit claims, payday loans and credit card debt. 

While she is free from the clutches of her predators, she still feels trapped. 

“I can’t get ahead because of the fact that I’m stuck,” she shares. “All of the money I have just goes to surviving.”

Increasingly, financial institutions are starting to recognize coerced debt and develop practices to identify it and help survivors get out from a financial hole that can hinder many aspects of their lives. 

Harvey didn’t realize the impact the debt would have on her credit history until she attempted to apply for a car loan. A tarnished financial history can doom a person for years, even decades, preventing them from securing rental housing, a mortgage or benefits such as child care subsidies or student aid. 

After surviving the horrors her captors forced on her, she has toiled for years to recover from the financial imprisonment they continue to cause. 

Recently she has received assistance from Reclaim, a national program run by Victim Services Toronto that helps survivors clear their coerced debts. 

She has managed to clear approximately $55,000 of the $65,000 that criminal sex traffickers racked up. Working tirelessly with agencies and financial institutions including payday loan services, she has managed to recover most of the way, part of her ongoing journey to reclaim the life she has fought to take back. 

The CRA, however, has been a major obstacle. 

Her trafficker fraudulently obtained tax benefits under her name, including the Canada Emergency Response Benefit (CERB) and child tax benefits. According to a letter from Reclaim sent to the CRA and shared with The Pointer, Harvey’s trafficker accepted overpayments in CERB and Canada Child Benefit (CCB) in the thousands of dollars. These amounts have been deducted from Harvey’s tax returns until the debt is cleared—the CRA then paused the deductions in January.

Despite clear evidence of her trafficking provided by Victim Services Toronto, one of Canada’s most prominent agencies assisting survivors; national advertising campaigns featuring Harvey; and her efforts to meet with Canada Revenue Agency officials to explain her story, the country’s federal tax authority has refused. It took months of advocacy just to have the CRA pause its repayment demands—taking large chunks of her current benefits and tax returns. 

The CRA still claims Harvey owes thousands of dollars.

“Cassandra has made significant strides to reach stability in her life, despite the trauma and victimization she faced,” Reclaim attested in its letter to the CRA. “The disruption that this coercive debt is causing serves as a constant reminder of her experience while having an impact on Cassandra’s continued success and journey of healing.”

Lawyers with Taxpayer Law have chosen to represent Harvey pro bono, and are now working on her behalf to urge the CRA to accept that the debts were fraudulent. According to Alex Klyguine, the CRA has mechanisms to do so, without requiring any significant steps.

“First, CRA could extend interest and penalty relief by expressly listing victims of sex trafficking as an ‘extraordinary circumstance’ under the Taxpayer Relief Program—stopping charges from snowballing,” he explains. “Second, CRA could use remission orders under the Financial Administration Act to cancel the principal of coerced tax debts and refund amounts previously taken. All of these steps are administratively feasible and require no new legislation.”

The CRA declined to answer specific questions from The Pointer about Harvey’s case, citing privacy concerns, and did not explain how more than a year has passed since they were made aware of Harvey’s issues, yet the debts remain. 

A spokesperson for the agency claimed the CRA takes the exploitation of vulnerable individuals “with the utmost seriousness.”

“We acknowledge that the harm experienced by survivors of human trafficking is profound, and we are deeply committed to ensuring our practices reflect fairness and accountability,” CRA officials claim. “Within this context the CRA is continuing to work with its partners to establish and implement procedures for these types of cases.”

Harvey’s was the first coerced debt case sent to the CRA. 

She expected the agency to show a willingness to work with her to develop policies and create a framework for dealing with other survivors. Instead, the entire process has left her feeling frustrated and dejected. 

“This is my time to show them how to navigate the process and the dos and the dont’s,” Harvey says. “I’m kind of just being thrown into a lump with everybody else.”

The ongoing failure by the CRA comes as Harvey is attempting to move on with her life and plan for her daughters’ future. She’s currently studying law at York University, with plans to become a criminal lawyer. On a tight student budget, the CRA deductions have meant there is little left to put away for her girls. She’s calculated the CRA has taken about $9,000 from tax assessments and other benefits since 2021. 

“I can’t contribute to their RESPs, because their child tax benefit was being taken away for so long,” she explains. 

“I think it plays a role into how my mental health is overall because in the back of my head whether I’m thinking about it or not, I do know I have a ridiculous amount of debt in my name.”

Harvey is not alone.

A groundbreaking report from Victim Services Toronto completed earlier this year analyzed credit reports of 156 survivors who collectively held a shocking $2.2 million of trafficking-related debt across more than 1,200 financial institutions. Despite this, the debt largely remains hidden. 

“The reason so many remain unresolved is not because survivors have not tried to clear them, but because the system does not yet fully recognize the unique nature of coerced debt,” the report highlighted.

The stakes are clear. Failing to help survivors in these situations can have drastic consequences. 

“Survivors caught in this cycle often have no clear way out. When debts continue resurfacing after years of silence, it can be retraumatizing. Many survivors consider taking on additional debt or returning to sex work to try and resolve what feels like an inescapable financial trap,” the report warns. 

“One of the most significant challenges in addressing financial harm related to human trafficking has been the lack of available data,” the VST report explains. “While fraud detection and financial abuse are well-documented in other contexts, the specific ways traffickers manipulate financial systems and the long-term financial consequences for survivors have remained largely invisible.”

Cassandra Harvey has been forced to obtain legal representation to clear coerced debts with the Canada Revenue Agency that traffickers incurred in her name while she was being exploited.

(Joel Wittnebel/The Pointer files)

Victim Services Toronto found that clearing debts with the CRA is “particularly difficult”.

The analysis found that while CRA debts may be less common than other forms of coerced debt (credit cards, telecommunications, payday loans), when they are incurred by a survivor they are usually quite high, averaging $10,735. While only six percent of survivors in the VST analysis owed debts to the CRA, a disproportionate 14 percent of all unresolved debts studied remained uncleared with the CRA due to “non-response from the creditor”. This means the federal agency was aware of the debt and the potential that it was coerced, yet did nothing about it.

While certain financial agencies are working to develop methods for identifying these types of debts, like TD Bank’s TD Helps program—which featured Harvey’s story, Canada remains far behind in effectively addressing the issue.

According to Marissa Kokkoros the executive director of Aura Freedom International, there is still a widespread stigma around human trafficking survivors that feeds their ongoing criminalization. 

Traffickers will often rope victims into their schemes, whether it's petty crimes, fraud or drug trafficking. This has the combined effect of making the survivor feel like a guilty party, preventing them from going to the police; and even if they do escape, the blame for those crimes, financial or otherwise, can fall on them.

“It’s the criminalization of survivors,” Kokkoros explains. “The entire anti-human trafficking sector is so very far behind in even the most progressive countries because those instances of criminalization are viewed as crimes.”

Within many financial institutions, coerced debt is treated as consumer fraud, triggering an investigative process that can be incredibly traumatizing for survivors. Often these investigators will require police reports or criminal charges against the trafficker—which is problematic as many survivors do not come forward to police. 

“(Harvey’s) case exposes a critical gap: survivors should not be pursued for coerced debts incurred by traffickers. Continuing to collect on such debts only compounds the harm. Other jurisdictions are beginning to recognize ‘coerced debt’; Canada’s tax administration should do the same within its existing authority. The CRA already has tools at its disposal and should apply them in a trauma-informed way,” Klyguine says. 

The lack of knowledge not only about coerced debt, but also the inner workings of human trafficking can also contribute to the lack of action on files like Harvey’s, Kokkoros says. 

“It’s not fair. The person working her case or her file, I can almost guarantee they know nothing about human trafficking or the way it works.”

In a list of recommendations to improve the handling of coerced debt cases in Canada, the Victim Services Toronto report recommends allowing for the acceptance of survivor affidavits or letters from support organizations to serve as credible evidence. The organization also recommends recognizing coerced debt as distinct from traditional fraud—something the Ontario government did at the end of 2023 through Bill 41; requiring financial institutions to pause collections on contested coerced debts; developing survivor-centred training for fraud investigation teams; and encouraging financial institutions to partner with survivor support organizations. 

“Addressing trafficking-related financial harm is not about overhauling existing systems but rather about enhancing and adapting the efforts already in place,” the report explains. “By exploring new collaborative approaches, stakeholders have a unique opportunity to create meaningful change that directly reduces the long-term financial harm survivors experience and reinforces a financial system that is more responsive, more adaptive and ultimately more just.”

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