WA man charged over alleged $2.57 million tax evasion and fraud

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This is a joint release between Australian Federal Police and Australian Taxation Office

A 65-year-old man who allegedly avoided paying more than $2.57 million in tax-related liabilities and impersonated an Australian Taxation Office employee is expected to face Perth Magistrate’s Court today (23 April 2021).

The Perth man has been charged with four offences over allegations he dishonestly failed to declare $7 million income from a royalty payment to a company he controlled, which police allege was done to avoid paying a GST liability and associated income tax.

The charges are the result of an extensive joint operation by the ATO-led Serious Financial Crime Taskforce (SFCT), involving the Australian Federal Police (AFP) and Australian Taxation Office (ATO).

The prosecution will allege the man dishonestly failed to declare the income and associated GST when he filed both a business activity statement in 2008 and an income tax return for the 2008-2009 financial year.

This meant he dishonestly avoided paying the $700,000 in GST the company had collected, as well as income tax of more than $1.87 million.

The ATO identified the alleged discrepancies during an audit in early 2012 and issued a garnishee notice to the company. Police will allege the man withdrew and transferred funds to another company he controlled to avoid the debt.

Prosecutors will also allege the 65-year-old man posed as an ATO debt management director during a phone call to an accountant in 2018, to try to find out what questions the AFP had been asking about the matter.

The man has been charged with:

  • Dishonestly caused a loss to another person, namely the Commissioner of Taxation, contrary to section 135.1(5) of the Criminal Code Act 1995 (Cth). The maximum penalty for this offence at the time was five years’ imprisonment.
  • Obtained a financial advantage by deception, namely the non-payment of income tax, contrary to section 134.2(1) of the Criminal Code Act 1995 (Cth). The maximum penalty for this offence is 10 years’ imprisonment.
  • Dishonestly obtained a gain from another person, namely the Commissioner of Taxation, contrary to section 135.1(1) of the Criminal Code Act 1995 (Cth). The maximum penalty for this offence at the time was five years’ imprisonment.
  • Impersonating a Commonwealth official, contrary to section 148.1(2) of the Criminal Code Act 1995 (Cth). The maximum penalty for this offence is two years’ imprisonment.

 This matter is being prosecuted by the Commonwealth Director of Public Prosecutions.

AFP Detective Sergeant Andrea Coleman said this extensive investigation shows the AFP, together with our Commonwealth, state and international partners are committed to stamping out fraud.

“We are working hard to identify and stop anyone who tries to cheat the system or obtain an unfair advantage over their competitors,” she said.

ATO Deputy Commissioner and SFCT Chief Will Day said the collaboration of the SFCT achieves results.

“We work together to catch criminals who attempt to defraud the tax and super system,” he said. “We have a crack team of experts working together to share intelligence across multiple Government agencies, domestically and internationally. Financial criminals who think they can cheat the system and get away with it can think again – no-one is beyond the reaches of the SFCT.”

The Serious Financial Crime Taskforce is an ATO-led joint-agency taskforce. It brings together the knowledge, resources and experience of relevant law enforcement and regulatory agencies to identify and address the most serious and complex forms of financial crime.

The SFCT includes the ATO, AFP, Australian Criminal Intelligence Commission, Attorney-General’s Department, Australian Transaction Reports and Analysis Centre (AUSTRAC), Australian Securities and Investments Commission, Commonwealth Director of Public Prosecutions and the Department of Home Affairs, including Australian Border Force and Services Australia.

The top four priorities of the SFCT are cybercrime (technology enabled crime) affecting the tax and superannuation systems, offshore tax evasion, illegal phoenix activity and serious financial crime affecting the ATO-administered measures of the Commonwealth Coronavirus Economic Response Package.

The SFCT started operation on 1 July 2015. From this date until 31 March 2021, the Taskforce has progressed cases that have resulted in:

  • Completion of 1,331 audits and reviews
  • Conviction and sentencing of 13 people
  • Raised liabilities of $1.045 billion
  • Collected $396 million

This shows the strength and tenacity that the SFCT has to bring the most serious offenders of financial crime to account.

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