A long-standing Serious Financial Crime Taskforce (SFCT) investigation led by the Australian Taxation Office (ATO) and the Australian Federal Police (AFP) has seen a 62-year-old man charged in connection with allegations of illegal “phoenix” activity.
The ATO and AFP investigated the activities of a pre-insolvency service provider who has been charged with nine offences of dishonestly causing a loss to the Commonwealth under the Criminal Code, with charges totalling $845,066. The man also faces a further four offences relating to the obstruction of Commonwealth officials, as it is alleged he prevented ATO officers from undertaking their duties during an access visit.
The investigation alleges the 62-year-old caused for PAYG withheld from employees’ wages to not be remitted to the ATO. As part of this scheme, it is alleged that the man caused for control to be taken of a number of businesses in financial difficulty, arranged for payment summaries to be issued to the employees using the details of these businesses and had straw directors appointed to the businesses to conceal his involvement and cause the alleged loss to the Commonwealth.
ATO Deputy Commissioner and SFCT Chief Will Day says the partnership of the two taskforces showcases the combined strength of the Commonwealth’s capabilities to tackle crime and evasion affecting the tax system.
“The Phoenix Taskforce has done an incredible job in bringing this matter to resolution before it was referred to the SFCT for criminal investigation. The collaboration between the two taskforces, and the combined power of so many government departments should send a strong message to financial criminals that their time is up,” said Mr Day.
“'Phoenixing' is an intentional act that requires planning – planning to build up debts, extract profits, liquidate the company and start again in a new company name. The alleged behaviour in this case demonstrates a calculated and callous disregard for the law, by someone who took advantage of his clients for his own benefit. The community won’t tolerate this behaviour, and neither will the SFCT.”
Illegal “phoenix” operators gain an unfair financial advantage at the cost of the community, by never meeting their financial obligations. They get this advantage at the expense of employees, suppliers and subcontractors. Employees miss out on wages, superannuation and other entitlements; suppliers and sub-contractors are left unpaid.
The SFCT is an ATO-led, joint-agency taskforce bringing together the knowledge, resources and experience of multiple agencies to identify and address the most serious financial crimes. The SFCT is equipped with the resources, data-matching capability, and international and domestic intelligence-sharing relationships to uncover even the most intricately planned serious 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 (ASIC), Department of Home Affairs, including Australian Border Force (ABF), Services Australia and the Commonwealth Director of Public Prosecutions (CDPP), which is prosecuting this matter.
The Phoenix Taskforce is an ATO-led, 38-member taskforce, which aims to protect public finances as well as businesses and employee entitlements by deterring and reducing illegal phoenix activity.
The ATO and partners, such as the AFP, take all forms of tax crime seriously and have strategies in place to detect and pursue the most sinister schemes.
If you or a member of the community has any knowledge or concerns about someone involved in tax fraud or evasion, you can report it by visiting ato.gov.au/tipoff or calling 1800 060 062. Reports can be made anonymously.
A long-standing Serious Financial Crime Taskforce (SFCT) investigation led by the Australian Taxation Office (ATO) and the Australian Federal Police (AFP) has seen a 62-year-old man charged in connection with allegations of illegal "phoenix" activity.