This week marks a significant milestone in the Australian Taxation Office’s (ATO) crackdown on the biggest GST fraud in Australia’s history, Operation Protego.
A raft of enforcement activity has been undertaken across the country by the ATO-led Serious Financial Crime Taskforce, including the execution of search warrants and issuing of warning letters.
Warrants were executed in three states against 10 individuals suspected of promoting the fraud including on social media.
“These actions send a strong message to people promoting this scheme that the ATO will find you, and there will be serious consequences.” ATO Deputy Commissioner and Chief of the Serious Financial Crime Taskforce (SFCT) John Ford said.
“For people getting involved or already involved, the message is engage with the ATO before we take firm action.
At 31 December 2022, the ATO has taken compliance action on more than 53,000 clients and stopped approximately $ 2.5 billion in fraudulent GST refunds from being paid to individuals seeking to defraud the system.
Two individuals have been sentenced to jail time for their crimes so far, following their arrest in 2022.
This follows 87 earlier arrests across the country, with many more to come. The ATO has commenced writing to more than 20,000 individuals involved in the fraud, warning them of the serious consequences coming their way unless they come forward and repay the money they have defrauded.
The fraud was first detected in early 2022 and involves offenders inventing fake businesses and Australian business number (ABN) applications, then submitting fictitious Business Activity Statements in an attempt to gain a false GST refund.
Promoters of the fraud use social media and other channels to recruit participants.
“Make no mistake, we are watching, and we have the ability to identify the people behind these posts. What they are doing is criminal and they will be dealt the full force of the law,” Mr Ford said.
The ATO has been issuing warnings to the community to be on the lookout for fraud schemes that are being promoted through social media and other channels.
“You need to check the facts – nobody is giving money away for free or offering loans that don’t need to be paid back. Simply speaking, if you don’t operate a business, you don’t need an ABN, and you shouldn’t lodge a BAS. This is fraud,” Mr Ford said.
For those who may be tempted by the promise of big gains, the ATO has sophisticated risk models and works with banks, law enforcement agencies and other organisations to share information and detect fraud. It also has access to intelligence through community tip offs, social media platforms and other information sources.
“It’s not a matter of if you’ll be caught, but when,” Mr Ford said. “So don’t be tempted. If something looks too good to be true, it probably is.”
AFP Assistant Commissioner Nigel Ryan said, “this fraud is not a crime against the government.”
“It’s a crime against every single hard-working and honest Australian who pays their taxes and expects everyone else to do the same,” he said.
If you are involved in the scheme, it’s better to come forward than wait for the ATO to come to you. Call on 1300 130 017 or visit ato.gov.au/GSTrefundfraud
It is expected more charges will be laid over coming months.