Project Wickenby
Project Wickenby
Overview
The Project Wickenby cross-agency task force plays a role in the Australian Government's fight against tax evasion, avoidance and crime.
It was established in 2006 to protect the integrity of Australia's financial and regulatory systems by preventing people from promoting or participating in the abusive use of secrecy havens.
With the combined efforts of eight government agencies, unprecedented international cooperation and sophisticated technology, Project Wickenby is getting results.
|
For the latest Project Wickenby results as at 28 February 2013, see:
|
The task force works hard to make sure the majority of the community who do the right thing have confidence that those who try to avoid or evade paying their share of tax are brought to account.
If you have any offshore income or assets, make sure you declare it. If you don't declare, you could face heavy penalties or jail time. It's not worth the risk.
|
A secrecy haven is a country, region or state that does not divulge information about an individual's financial/banking affairs or structures. These arrangements may be exploited to conceal income and evade tax because they do not have effective information exchange arrangements with Australia.
|
Who are we?
The Project Wickenby cross-agency task force consists of eight federal departments and agencies:
The eight agencies work together in partnership, with the ATO as the lead agency.
Project Wickenby is the first time the full range of Australian Government resources has been used to address the significant threat that illegal offshore schemes pose to the integrity of Australia's financial and regulatory systems.
By combining legal and administrative powers, the Project Wickenby task force is more effective than any single agency acting independently. Task force activities include intelligence sharing, tax audits, criminal investigations, prosecutions and education programs.
Project Wickenby versus Operation Wickenby
|
Operation Wickenby refers to the criminal investigations led by the Australian Crime Commission (ACC) since 2004. Project Wickenby refers to the broader cross-agency task force, which now consists of eight agencies, including the ACC.
|
CEO meetings
The Project Wickenby department and agency Chief Executive Officers (CEOs) meet every six months to review Wickenby progress, plan for upcoming activities and provide high-level governance to the project.
Project Wickenby Cross-Agency Advisory Committee (CAAC)
The CAAC consists of representatives from the departments and agencies, with members meeting monthly to:
- advise on strategic risks, approaches, cases and other matters relevant to Project Wickenby
- share knowledge on methods, and develop and propose cross-agency approaches, including international liaison
- assist and oversee the development and maintenance of cross-agency plans and reports for Project Wickenby
- identify and advise the relevant stakeholders of legislative and other impediments to Project Wickenby
- identify and facilitate improvements in cross-agency working arrangements and relationships
- assist respective agencies in providing reports and advice to government on Project Wickenby, including assisting with any reviews of expenditure that are required by government.
Project Wickenby is an integral part of the Australian Government's fight against tax evasion, avoidance and crime. In particular, Project Wickenby addresses the abusive use of secrecy havens by investigating offshore schemes that involve false deductions and concealed income and gains.
The Project Wickenby cross-agency task force, established in 2006, consists of eight federal agencies. This cross-agency approach continues to be necessary because Australia is increasingly engaging in the global economy and the size and scale of international tax avoidance and evasion is extensive and growing.
The key objectives of the task force are to:
- reduce international tax evasion in the Australian taxation system
- enhance strategies and capabilities of Australian and international agencies to collectively detect, deter, deal with, and disrupt international tax evasion and money laundering
- improve community confidence in Australia's regulatory systems
- reform administrative practice, policy and legislation.
With their combined legal and administrative efforts and the use of sophisticated technology, the task force has made significant progress in identifying a range of illegal offshore schemes.
Three key features of the schemes already under investigation are:
- concealing income or gains, or creating false or fraudulent tax deductions
- concealing assets offshore to avoid obligations in Australia
- returning funds to Australian taxpayers in a deceitful manner, including as laundered money.
The task force has already uncovered a substantial number of people participating in these schemes, with cases involving varying degrees of dishonesty and deception.
Who do we investigate?
The Project Wickenby task force investigates people who promote, facilitate or participate in illegal offshore schemes.
Promoters are mainly located offshore - they formulate and deliver international tax evasion schemes to participants, usually through intermediaries.
Intermediaries are a key leverage point in tax evasion schemes and are usually located onshore - in this case, in Australia. They play a significant role in recruiting participants for promoters, and will often facilitate the arrangement. Intermediaries include, but are not limited to, accountants, tax agents and lawyers.
Participants are Australian taxpayers who use the illegal offshore schemes offered by a promoter. Participants can come from all walks of life and are usually introduced to a scheme by an intermediary. Although most participants enter these schemes in an attempt to avoid or evade their taxation obligations, some are lured in without realising their actions are illegal.
|
If you think you may have become involved in something suspect, phone the ATO on 1800 306 377 to discuss your situation. We are always willing to help taxpayers do the right thing, and you can remain anonymous if you prefer.
|
Task force activities
The task force makes use of its combined powers and capabilities to deter promoters of, and participants in, illegal schemes, within Australia and overseas.
Activities carried out in Australia under Project Wickenby include:
- civil audits and risk reviews undertaken by the ATO and civil investigations conducted by the Australian Securities & Investments Commission (ASIC)
- criminal investigations conducted by the Australian Crime Commission (ACC), Australian Federal Police (AFP) and ASIC
- prosecutions and other legal action undertaken by the Attorney-General's Department (AGD), the Commonwealth Director of Public Prosecutions (CDPP), and the Australian Government Solicitor (AGS)
- administrative actions, including audits, banning people from the financial services industry and using data from the Australian Transaction Reports and Analysis Centre (AUSTRAC) to track money moving in and out of Australia
- proceeds of crime action, including action to restrain property and seek its forfeiture.
|
A single ASIC investigation may generate a range of actions - administrative, civil and criminal.
|
|
For more information about what Project Wickenby is doing in the international area, see Working globally.
|
Funding the fight
In 2006, the Australian Government provided $308.8 million over seven years (to 2012) to fund the Project Wickenby cross-agency task force.
In 2009, the government increased this funding by an additional $122.1 million over four years (to 2013) to $430.9 million in total:
- Phase 1 - $308.8 million from February 2006 to June 2010, with the period of funding for the Commonwealth Director of Public Prosecutions extending to 30 June 2012.
- Phase 2 - $122.1 million over four years from 2009 to 2013.
The 2012-13 Budget provided a further $76.8 million for Project Wickenby agencies. The ATO component of this funding ($48 million) will commence in 2013-14, with partner agencies to start receiving funding in 2012-13.
Table 1: Project Wickenby funding by agency
Expense by financial year ($m)
|
|
|
2005 -06
|
2006 -07
|
2007 -08
|
2008 -09
|
2009 -10
|
2010 -11
|
2011 -12
|
2012 -13
|
2013 -14
|
2014 -15
|
Total
|
ATO
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
14.4
|
39.1
|
37.9
|
34.5
|
34.9
|
|
|
|
|
|
160.8
|
Phase 2
|
|
|
|
|
|
28.7
|
24.6
|
20.9
|
|
|
74.2
|
Phase 3
|
|
|
|
|
|
|
|
|
29.7
|
18.3
|
48.0
|
ACC
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
3.0
|
4.1
|
3.3
|
3.3
|
3.4
|
|
|
|
|
|
17.1
|
Phase 2
|
|
|
|
|
1.8
|
3.2
|
2.4
|
2.0
|
|
|
9.4
|
Phase 3
|
|
|
|
|
|
|
|
1.6
|
2.1
|
1.9
|
5.6
|
CDPP
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
|
11.4
|
15.4
|
16.2
|
14.0
|
6.0
|
1.1
|
|
|
|
64.1
|
Phase 2
|
|
|
|
|
0.5
|
1.6
|
3.4
|
3.8
|
|
|
9.3
|
Phase 3
|
|
|
|
|
|
|
|
0.6
|
3.7
|
3.7
|
8.0
|
AFP
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
2.9
|
16.1
|
13.4
|
13.6
|
13.6
|
|
|
|
|
|
59.6
|
Phase 2
|
|
|
|
|
|
7.9
|
7.5
|
7.4
|
|
|
22.8
|
Phase 3
|
|
|
|
|
|
|
|
|
5.2
|
5.1
|
10.3
|
ASIC
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
1.8
|
2.7
|
2.7
|
|
|
|
|
|
|
|
7.2
|
Phase 2
|
|
|
|
|
|
0.8
|
0.7
|
0.4
|
|
|
1.9
|
Phase 3
|
|
|
|
|
|
|
|
|
0.7
|
0.6
|
1.3
|
AUSTRAC
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
|
|
|
|
|
|
|
|
|
|
|
Phase 2
|
|
|
|
|
0.8
|
0.7
|
0.7
|
0.7
|
|
|
2.9
|
Phase 3
|
|
|
|
|
|
|
|
0.5
|
1.0
|
1.0
|
2.5
|
AGD
|
|
|
|
|
|
|
|
|
|
|
|
Phase 1
|
|
|
|
|
|
|
|
|
|
|
|
Phase 2
|
|
|
|
|
0.4
|
0.4
|
0.4
|
0.4
|
|
|
1.6
|
Phase 3
|
|
|
|
|
|
|
|
0.1
|
0.5
|
0.5
|
1.1
|
Total
|
Phase 1
|
308.8
|
Phase 2
|
122.1
|
Phase 3
|
76.8
|
Audits and investigations have discovered people are not only attempting to conceal their income, but are also creating false deductions and returning money to Australia as untaxed funds.
You may not be aware that the arrangement that you have entered into is illegal and that you may be breaking the law. International promoters and domestic intermediaries often use attractive terms like 'effective tax management' or 'tax minimisation' when promoting their tax evasion and avoidance schemes.
If you have any doubts about a tax minimisation scheme you are involved in, you should speak with your tax adviser, legal representative, or contact the ATO. Ultimately, it is your responsibility to make sure the way you manage your tax matters is legal.
You should also make sure your tax agent is registered with the Tax Practitioners Board.
|
The ATO is always willing to help taxpayers do the right thing. If you think you or, if you are a tax practitioner, your clients, are involved in any of these arrangements, phone us on 1800 306 377. You can remain anonymous if you prefer.
|
Investigations have discovered illegal schemes where people are not only attempting to conceal their income, but are also creating false deductions and returning money to Australia as untaxed funds.
Arrangements illegally concealing income or creating deductions most commonly include the following:
- False or inflated invoices - international promoters providing Australian businesses with false or inflated invoices to claim tax deductions.
- Sham loans - locally-designed and promoted arrangements where investors use 'loans' that are records only and no money is exchanged. The sham loans are provided by an international tax promoter to invest and claim a tax deduction.
- Asset ownership and management - Australian assets are 'transferred' to an international entity legally owned by a promoter who acts on the wishes or directions of the owner. This transfer is a sham and is used to evade tax or deprive other family members or creditors of the assets. These may also be used to manipulate securities markets.
- Share acquisitions - options or shares in public companies are sold to a foreign entity legally owned by a promoter, with 'beneficial ownership' remaining with the taxpayer. The Australian taxpayer's beneficial ownership is concealed to prevent authorities from linking the taxpayer to the transactions and to shelter the taxpayer's profits from tax in Australia. These transactions may also be in breach of the Corporations Act 2001 - for example, share warehousing, breach of director's duties, failure to disclose, or insider trading.
Schemes returning funds to Australian taxpayers in a deceitful manner as untaxed funds commonly include the following:
- Debit and credit cards - these provide easy access to money. Accounts are generally held offshore in the Australian taxpayer's name, the names of family members or friends, or in false names. The funds are generally withdrawn in cash from Australian ATMs.
- Gift or inheritance - funds are returned to Australia as a gift from an alleged overseas relative or as an alleged inheritance from a relative who died with no children of their own. Promoters go to great lengths to check the family genealogy before using the 'dead relative' option.
- Payment of expenses - the international promoter pays expenses incurred by the Australian taxpayer in Australia.
- Rental schemes - Australian taxpayers 'lease' their holiday homes to an international promoter. These sham leases may be designed to return the taxpayer's funds from offshore, or allow tax deductions for the costs of these holiday homes, such as interest or rate payments.
- Back-to-back loans - an Australian taxpayer with funds offshore accesses the money by 'borrowing' it through an international promoter. The taxpayer uses the funds for working capital, then claims the 'interest' on the sham loan as a tax deduction. The interest is returned offshore to top up the funds there.
|
If you think you or, if you are a tax practitioner, your clients, are involved in any of these arrangements, phone us on 1800 306 377. If you contact us before becoming the subject of a review or audit, you may be eligible for reduced penalties.
|
Who will be prosecuted?
Prosecutions are the responsibility of the CDPP.
Only the CDPP has the power to grant immunity from prosecution and provide favourable consideration in accordance with the Prosecution Policy of the Commonwealth.
Cases may be given favourable consideration when:
- the case does not exhibit a significant degree of criminality on the part of the taxpayer
- the taxpayer cooperates by making a full and frank disclosure about how the arrangements in question operated, and provides documents and materials involved in the alleged offences
- the taxpayer cooperates by making a formal written witness statement about the alleged offences, providing evidence for the Crown in any relevant proceedings.
|
Cases are only given favourable consideration when those involved contact us before they are the subject of a review or audit.
|
Indicators of criminal behaviour include offences:
- committed over a long period of time
- involving a degree of sophistication, such as the creation of false documents or sham agreements
- resulting in the unlawful obtaining of a substantial sum of money
- where the criminal conduct did not stop voluntarily.
When a person is prosecuted, the sentence must take into account the person's willingness to cooperate with the investigation; a 'sentencing discount' can be granted.
Scenarios - could this be you?
Below are a number of scenarios that demonstrate the huge risks people take when they promote or participate in illegal offshore schemes:
- If it looks too good to be true, it probably is - demonstrates the huge risk that active and potential participants take when getting involved in illegal offshore schemes.
- Don't be fooled by bad advice - highlights some of the risks for people from culturally and linguistically diverse backgrounds.
- Make sure to check out advice from others - focuses on the role of the intermediary or promoter in drawing people into illegal offshore schemes.
- Retired truck driver finds we are in it for the long haul - shows there is no age limit when it comes to people who participate in illegal offshore schemes.
- Don't leave it to loved ones to clean up your mess - outlines the consequences that participation in illegal offshore schemes can have on loved ones.
|
If you think you may have become involved in something suspect, phone us on 1800 306 377 to discuss your situation. We are always willing to help taxpayers do the right thing, and you can remain anonymous if you prefer.
|
We encourage people to come forward and voluntarily disclose unreported income from offshore accounts and activities.
Taxpayers who make a voluntary disclosure will generally face reduced penalties provided they come forward before they are subject to a review or audit - there will also generally be less chance of criminal investigation.
Action taken against people found to be involved in concealing income, gains or illegal deductions will vary, according to the level of their involvement and the nature of the offences committed. It may include all of the following:
- criminal prosecution, fines and imprisonment
- action taken under the Proceeds of Crime Act
- civil action under tax and corporations law
- audits
- amending tax assessments
- penalties and interest
- being banned from the financial services industry, where relevant.
|
We are always willing to help taxpayers do the right thing. If you are concerned you may be involved in a suspect scheme and would like to discuss your situation with a tax officer, phone us on 1800 306 377. You can remain anonymous if you prefer.
|
|
If you have information that might help the task force, phone us on:
- 1800 306 377 if you are in Australia
- +61 1800 306 377 if you are overseas.
|
We investigate every report of tax evasion and seek evidence about each allegation, including:
- monitoring the taxpayer's compliance
- requesting further information from third parties
- seeking information directly through phone calls, letters or visits.
Our staff are available to assist you, and your information is appreciated. Calls are free and usually only take a few minutes.
|
Your confidentiality is assured and you can remain anonymous if you prefer.
|
Project Wickenby is working hard to ensure people involved in the abusive use of secrecy havens are held accountable for their actions.
Offshore promoters attempt to design tax evasion schemes that both hide income and avoid the taxation laws of most countries. While some schemes are quite straightforward, others can be more complex, making detection and investigation time consuming.
Unprecedented international cooperation, extensive resources, and the use of technology is helping the task force successfully track down people involved in illegal offshore schemes. The consequences for these individuals can be severe and may include heavy penalties or significant jail terms.
The task force pursues each investigation with persistence and does not close a case until the trail has been thoroughly exhausted. Project Wickenby conducts criminal and overseas investigations, as well as civil audits and risk reviews.
|
We are always willing to help taxpayers do the right thing. If you are concerned you may be involved in a suspect scheme and would like to discuss your situation with a tax officer, you can phone us on 1800 306 377. You can remain anonymous if you prefer.
|
In the course of Project Wickenby audits and reviews we have:
- made 103 access visits with notice
- made 77 access visits without notice
- issued 2,915 notices to 'furnish information'
- issued 264 notices to 'attend and give evidence in interviews'
- issued 2,724 notices of (tax) assessment
- issued 23 departure prohibition orders.
|
Departure prohibition orders prevent a person leaving the country without making provision for tax liabilities.
|
Criminal investigations
The Australian Crime Commission (ACC), Australian Federal Police (AFP) and Australian Securities & Investments Commission (ASIC) are all undertaking criminal investigations as part of Project Wickenby.
Criminal investigations into illegal offshore schemes involving false deductions, and concealed income and gains, are often complex and can require a lot of time and resources. A single investigation may involve a number of promoters and many intermediaries and participants.
With extensive resources and sophisticated technology, including data tracking and matching, the task force is successfully bringing tax cheats to justice.
Table 2: Criminal investigations from Project Wickenby
Agency
|
Current
investigations
|
Prosecutions
|
Finalised
|
The ACC has:
- issued 266 notices to obtain evidence
- issued 430 summonses
- completed 402 examinations
- executed 58 search warrants.
|
1
|
5
|
5
|
The AFP has:
|
6
|
6
|
3
|
ASIC has:
- issued 459 notices to obtain evidence
- completed 91 compulsory examinations
- executed 2 search warrants
- conducted 142 interviews.
|
2
|
0
|
5
|
ATO
|
0
|
0
|
2
|
Total
|
9
|
11
|
15
|
Getting results
Project Wickenby's success is demonstrated by over $1.59 billion in liabilities raised, as well as increased tax collections from improved compliance behaviour by participating taxpayers following intervention by the Wickenby task force.
This is further supported by ongoing investigations and prosecutions, resulting in substantial sentences and strong deterrents in the sentencing judgments.
Recent results show the net is closing on promoters and participants in tax schemes involving the abusive use of secrecy havens.
Table 3: Results at 28 February 2013
Investigations
|
Audits - including risk reviews
|
Tax liabilities raised
|
$1.592b
|
Audits (including reviews) in progress
|
182
|
Audits (including reviews) completed
|
3,535
|
Prosecutions
|
|
|
People charged
|
69
|
Convictions
|
35
|
Money recouped
|
Cash Collections - Cash collections are reported on a quarterly basis. The current figures are for the quarter ending December 2012.
|
Cash collections
|
$381.62m
|
Cash collections in subsequent years from people subject to Project Wickenby action
|
$307.6m
|
Other money recouped
|
$2.68m
|
Total
|
$691.9m
|
Ongoing compliance
Evidence shows Project Wickenby interventions are improving taxpayers' willingness to comply with their taxation obligations.
People who have been investigated by Project Wickenby have subsequently voluntarily lodged more accurate tax returns and paid more tax than they have done in the past.
As at 28 February, Project Wickenby has collected more than $691 million of outstanding revenue. This exceeds the targeted collection of $557 million set for this date, and includes:
- more than $381 million in cash collections
- nearly $308 million made from increased voluntary compliance following interventions by the Project Wickenby task force
- Over $2 million in assets recovered by the CDPP under Commonwealth Proceeds of Crime provisions.
|
Cash collections are revenue collected by the ATO as a result of Project Wickenby activities. Payments of tax liabilities can be by instalment under arrangement, as agreed by the Commissioner of Taxation. As such, cash collected during a period does not necessarily relate to matters finalised in that period.
Cash collections are reported on a quarterly basis - the current figures are for the quarter ending December 2012.
|
Cash commitment to government graph
The following graph shows how the collections made so far are tracking against Project Wickenby's collection target.
Prosecutions and court judgments
So far, 69 individuals have been charged with serious offences under Project Wickenby. Of these, 18 resulted from ACC investigations, and 51 from investigations by the AFP.
To date, there have been 35 criminal convictions, with the courts emphasising the following when making their judgments:
- the amount of the loss to the public purse
- that the conduct was calculated criminal conduct
- the offending was planned
- the offences were caused by greed and not need
- the need for general and personal deterrence.
In addition to the 35 convictions, a further 69 people have been prosecuted for summary offences - which can attract penalties of imprisonment of less than 12 months - with the majority involving outstanding lodgments.
Working globally
The Project Wickenby cross-agency task force also works with governments and organisations around the world to fight tax evasion and avoidance on a global scale. Activities conducted by Project Wickenby in conjunction with overseas authorities and organisations include:
- accessing information and resources from private sector and government departments around the world to assist with civil and criminal investigations and prosecutions
- participating in information sharing, intelligence gathering, investigations and audits with international organisations such as:
- foreign tax administrations - subject to Australia's bilateral tax treaties and Tax Information Exchange Agreements (TIEAs)
- the Joint International Tax Shelter Information Centre (JITSIC)
- the Organisation for Economic Co-operation and Development (OECD).
TIEAs are an important tool in Australia's efforts to combat offshore tax evasion. The agreements:
- provide for the effective exchange of information between Australia and its TIEA partners
- promote fairness
- enhance Australia's ability to administer and enforce its domestic tax laws.
Currently, Australia has signed TIEAs with 34 countries. These agreements enhance Project Wickenby's ability to seek information on Australian taxpayers who are using these jurisdictions to avoid their taxation obligations.
These new treaties reflect the growing commitment by countries around the world to the accepted international principles of greater tax transparency and the elimination of harmful tax practices.
The government and Project Wickenby agencies have issued a number of media releases, speeches and responses to the media over the life of the project.
2012
- 15 May 2012 - Company directors sentenced under Project Wickenby - ATO media release.
The courts continue to send a strong message about their low tolerance for tax cheats by imposing significant jail terms.
- 3 May 2012 - Second arrest for dealing in $63 million in proceeds of crime - joint ATO and AFP media release.
The Australian Federal Police (AFP) has today charged a second man with conspiring to dishonestly cause a loss to the Australian Tax Office (ATO) and conspiring to deal in the proceeds of crime to the value of $63 million as part of an ongoing Project Wickenby investigation.
- 26 April 2012 - $40 million in assets restrained, tax evasion and money laundering scheme dismantled - joint ATO and AFP media release.
As part of Project Wickenby, the Australian Federal Police has charged a man with conspiring to dishonestly cause a loss to the Australian Tax Office and conspiring to deal in the proceeds of crime to the value of $63 million, dismantling a multi-million dollar tax evasion and money laundering scheme.
- 7 March 2012 - The Wickenby deterrence - ATO media release.
Two recent Project Wickenby-related court cases have reinforced community expectations that serious tax fraud should be treated sternly and appropriately, Tax Commissioner Michael D'Ascenzo said today.
- 9 February 2012 - Administration of Project Wickenby - Australian National Audit Office (ANAO) report.
The ATO welcomes the ANAO's findings after conducting a performance audit into the administration of Project Wickenby. The report was tabled in Parliament today making four recommendations, which are all agreed to by the ATO.
2011
- 24 March 2011 - Brothers sentenced under Project Wickenby - ATO media release.
Two brothers were each sentenced to two years and seven months jail in the NSW District Court following investigations into the use of tax haven structures in Vanuatu under Project Wickenby.
- 2 March 2011 - One billion and counting: Wickenby reaches milestone - ATO media release.
Tax Commissioner Michael D'Ascenzo announced Project Wickenby has reached a new milestone in its fight against tax crime, with one billion dollars in tax liabilities raised since 2006.
2010
2009
- 20 October 2009 - Anti-tax evasion strategy paying major dividends - media release by the Assistant Treasurer, Senator Nick Sherry.
Assistant Treasurer, Senator Nick Sherry, today announced the national strategy aimed at stamping out tax evasion is reaping dividends for the Australian community.
- 22 July 2009 - Tax crackdown nets $313 million in 2008-09 - media release by the Assistant Treasurer, Senator Nick Sherry.
Two high-profile tax crackdowns have this past financial year raised more than $313 million in tax liabilities and penalties against tax cheats the Assistant Treasurer, Senator Nick Sherry, has announced today.
- 21 July 2009 - ATO submission to US Senate Committee on Homeland Security and Governmental Affairs
The ATO response to a US Senate Committee on Homeland Security and Governmental Affairs request for Australian case studies showing the use of entities incorporated under the laws of some states in the United States of America.
- 30 June 2009 - Did you know? Not a penny more - speech by the Commissioner of Taxation, Michael D'Ascenzo.
- 30 June 2009 - Australia Endorses Ongoing Global efforts to Combat Tax Avoidance and Evasion - media release by the Assistant Treasurer, Senator Nick Sherry.
The Assistant Treasurer, Senator Nick Sherry, today confirmed that following the Second Conference on the Fight against International Tax Fraud and Evasion held in Berlin, Germany, the Rudd Government continues to strongly support the tough global position against tax evasion taken by the 19 participant countries.
- 13 May 2009 - Federal Budget 2009-10: Commissioner's message to staff - the Commissioner of Taxation's online update
- 10 February 2009 - Another 12 charged under Project Wickenby - AFP media release.
Twelve people will face Downing Centre Local Court in Sydney today as a result of an investigation into a $10 million offshore tax evasion and money laundering scheme.
2008
2007
- 14 August 2007 - Project Wickenby progress - media release by the Treasurer, Peter Costello, and the Minister for Justice and Customs, Senator David Johnston.
The Treasurer, Peter Costello, and the Minister for Justice and Customs, David Johnston, today announced that Project Wickenby has made significant progress on a number of fronts, consistent with the strategy announced by the Government in February 2006. Project Wickenby is a multi-agency task force investigating and prosecuting internationally promoted schemes to avoid or evade Australian taxes and launder money.
- 19 July 2007 - First conviction under Operation Wickenby (PDF, 26.7KB) - media release by the Minister for Justice and Customs, Senator David Johnston.
Minister for Justice and Customs, Senator David Johnston today acknowledged Operation Wickenby's first conviction in to tax evasion as an important milestone for the Australian Government's crackdown against corporate crime.
- 14 March 2007 - The business of adding public value - speech by the Commissioner of Taxation, Michael D'Ascenzo.
- 1 February 2007 - Wickenby Matter - court appearance - ACC media release.
A man has appeared before the County Court of Victoria today, 1 February 2007, in relation to offences against the laws of the Commonwealth as the result of the Australian Crime Commission (ACC) Board approved Operation Wickenby investigations.
2006
- 29 August 2006 - Project Wickenby - ATO media release.
Agencies involved in Project Wickenby routinely analyse press articles to assure themselves there has been no inappropriate release of information.
- 17 August 2006 - Wickenby information sharing and broader tax secrecy review - media release by the Treasurer, Peter Costello.
New legislation to be introduced in Parliament will help agencies involved in Project Wickenby to better share information to aid concerted law enforcement.
- 20 July 2006 - Project Wickenby arrests - media release by the Treasurer, Peter Costello.
Three people have been arrested today by the Australian Crime Commission and charged with tax evasion offences.
- 30 June 2006 - Operation Wickenby Federal Court ruling welcomed by Minister (PDF, 35.6KB) - media release by the Minister for Justice and Customs, Senator Chris Ellison.
The Minister for Justice and Customs, Senator Chris Ellison, has welcomed today's ruling by the Federal Court in Egglishaw v. ACC that enables the Australian Crime Commission (ACC) to use the contents of a laptop computer seized by the ACC as part of Operation Wickenby in February 2004, which is believed to be Australia's largest tax fraud investigation.
- 19 May 2006 - Ongoing Operation Wickenby - media release by the Minister for Justice and Customs, Senator Christopher Ellison.
The Minister for Justice and Customs, Senator Chris Ellison, has welcomed today's High Court ruling relating to what is believed to be Australia's largest tax fraud investigation, Operation Wickenby.
- 8 February 2006 - Government provides extra funds to combat tax scams - media release by the Treasurer, Peter Costello.
The Treasurer today announced that the Government would provide an additional $305 million over the next six years to further resource a multi-agency operation directed at promoters of and participants in off-shore tax schemes and fraud.
- 8 February 2006 - New funds for fight against serious tax fraud and money laundering (PDF, 19.07KB) - media release by the Minister for Justice and Customs, Senator Christopher Ellison.
The Minister for Justice and Customs, Senator Chris Ellison, today welcomed an announcement by the Treasurer of an extra $305 million in funding for the fight by Australian law enforcement agencies against serious tax fraud and money laundering.
2005
- 10 June 2005 - ATO acts on offshore schemes - ATO media release.
Over the last two days the ATO has acted on information suggesting that individuals have entered into offshore schemes directed at creating fictitious deductions or concealing income from tax. The schemes rely on the use of offshore structures put in place by scheme promoters.
- 10 June 2005 - Australian Crime Commission uncovers alleged fraud against the Commonwealth (PDF, 34.6KB) - media release by the Minister for Justice and Customs, Senator Christopher Ellison.
The Minister for Justice and Customs, Senator Chris Ellison, today applauded the efforts of the Australian Crime Commission (ACC), the ATO and the Australian Federal Police (AFP) in targeting those who have allegedly committed major fraud against the Commonwealth.
How is it decided which agency leads an individual investigation? What powers do the Project Wickenby agencies have and when do they enforce them?
Each of the agencies could come across matters in their day-to-day work that they believe may relate to Project Wickenby. These matters may be tabled at a cross-agency forum to determine the most appropriate response, which could include referral for criminal investigation. If it appears there are possible crimes being committed, which include tax fraud and money laundering, then agencies such as the ACC and the AFP will be asked to assist with the case.
|
Each agency has its own statutory powers and functions, which are summarised below.
|
ATO: conducts analysis, reviews and audits related to tax. Where it has been determined that the correct tax has not been paid, we will raise tax assessments and seek to recover the proper tax due, together with penalties and interest. We have officers that assist other agencies with criminal investigations by providing tax and financial analysis expertise relating to Wickenby-type schemes.
ACC: conducts criminal investigations and manages the ensuing litigation. They will assist the ATO and AFP in dismantling organised syndicates. The ACC shares the intelligence it collects and analyses that is related to offshore organised tax fraud schemes.
AFP: conducts criminal investigations into tax haven schemes and other criminal matters that may be unearthed as a result of the initial investigation. The ATO often refers cases to the AFP.
ASIC: has the power to investigate matters where it has reason to suspect there may have been a contravention of the Corporations Act 2001. ASIC may take its own enforcement or regulatory action to enforce such contraventions and these could include contraventions relating to market manipulation or a failure to comply with director's duties, among other matters.
AUSTRAC: provides intelligence and data sharing under the terms of the memorandum of understanding between AUSTRAC and the ATO, AFP, ACC and ASIC. AUSTRAC also provides analytical and intelligence support.
CDPP: will progress prosecutions that result from Project Wickenby and be involved in cases, where appropriate, as early as possible. Prosecutorial activity will include summary offences, proceeds of crime actions and complex criminal prosecutions.
AGS: (Australian Government Solicitor) provides high-level advice on legal risks and potential civil proceedings taken by or against the Australian Government or any joint agency. Where the AGS is the legal services provider for any of the joint agencies, it manages and coordinates those proceedings in line with Project Wickenby strategic objectives.
Attorney-General's Department: manages mutual assistance requests for formal assistance from other jurisdictions on criminal investigations and prosecutions.
What are the key results of Project Wickenby?
Project Wickenby figures are updated each month on the ATO website.
What is the cost of Project Wickenby, and how is the money allocated?
In 2006, the Australian Government provided $308.8 million over seven years to fund the Project Wickenby cross-agency task force.
In 2009, the government increased this funding by an additional $122.1 million to $430.9 million in total:
- Phase 1 - $308.8 million from February 2006 to June 2010, with the period of funding for the CDPP extending to 30 June 2012
- Phase 2 - $122.1 million over four years from 2009 to 2013.
The 2012-13 Budget provided a further $76.8 million for Project Wickenby agencies. The ATO component of this funding ($48 million) will commence in 2013-14 with partner agencies to start receiving funding in 2012-13.
|
For more information about the cost of Project Wickenby and how the money is allocated, see Project Wickenby funding.
|
Why is there a difference between the assessments raised and the money collected?
The rate of collections compared to actual assessments differs for several reasons. Firstly, because Project Wickenby deals with people hiding assets and income in secrecy havens, recovery of monies located in those jurisdictions can take time. The ATO can issue Departure Prohibition Orders (DPO), preventing people from leaving the country until tax clearance is given. Collection can also be delayed where assets and monies are held through a series of offshore structures that need to be traced through secrecy havens.
A further variation between collections and liabilities raised is that sometimes the available information does not make the ultimate tax position clear. Alternative assessments may be raised - for example, on both a company and the director - although ATO policy is to collect only one liability.
What are the possible consequences for people convicted of offences under Project Wickenby?
Although tax minimisation schemes may appear attractive, people who promote or participate in illegal offshore schemes are running enormous risks - the consequences are severe, and range from civil sanctions and fines through to heavy penalties and significant jail terms.
Why can Project Wickenby court cases take so long to finalise?
The fight against tax evasion, avoidance and crime can be complex and lengthy, but Project Wickenby is working hard to ensure people involved in the abusive use of secrecy havens are held accountable for their actions.
Offshore promoters attempt to design tax evasion schemes that both hide income and avoid the taxation laws of most countries. While some schemes are quite straightforward, others can be extremely complex, which makes detection, investigation and litigation time consuming.
How do Tax Information Exchange Agreements (TIEAs) work?
TIEAs outline the obligation between Australia and the non-OECD participating partner to help each other by exchanging correct tax information relevant to the administration and enforcement of their respective domestic tax laws - civil and criminal. Information may only be provided on request - that is, a jurisdiction is not obliged to provide information it has not been asked for by the other jurisdiction.
TIEAs differ from a comprehensive international tax agreement (also known as tax treaty or double tax agreement) as they do not contain any provisions concerning the allocation of taxing rights over income.
TIEAs also differ from the exchange-of-information article under the traditional international tax agreements in two ways:
- TIEAs are broader than international tax agreements as they cover all taxes administered by the Commissioner of Taxation and criminal and civil tax matters.
- They are narrower than international tax agreements, in that the information exchanged can only relate to a specific investigation occurring at the time - the information-exchange article under international tax agreements allows for specific, spontaneous and automatic exchange of information.
How do people get involved in schemes, and what should they do to protect themselves?
Sometimes individuals can be lured in to these schemes without realising their attempt to minimise their tax obligation is illegal.
Who should you contact if you think you might be caught up in a Wickenby-type scheme or want to provide information about a scheme?
|
We are always willing to help taxpayers do the right thing. If you are concerned you may be involved in a suspect scheme and would like to discuss your situation with a tax officer, phone us on 1800 306 377. You can remain anonymous if you prefer.
|
Can the ATO provide comment or confirmation on a case?
The tax laws do not permit us to disclose information about the tax affairs of any taxpayer, except in very limited circumstances. These laws prevent us from commenting on individual cases in the media.
We are always willing to help taxpayers to do the right thing. If you have any queries about Project Wickenby or would like to speak with a tax officer about your situation, phone 1800 306 377. You can remain anonymous if you prefer.
If you have information that could help the Project Wickenby task force, phone:
- 1800 306 377 if you are in Australia
- +61 1800 306 377 if you are overseas.
Useful links
Project Wickenby terms of reference
Purpose
- These terms of reference clarify the objective and broad approaches of Project Wickenby with reference to the commitments and undertakings to government. They are designed to complement existing Memoranda of Understanding and other administrative arrangements between relevant agencies.
Background
- In February 2006, the Australian Government approved additional funding of $308.8 million for a joint operation addressing the promotion of and involvement in tailored international tax schemes. The project now referred to as Project Wickenby is being undertaken by the ATO, the Australian Securities & Investments Commission (ASIC), the Australian Crime Commission (ACC), the Commonwealth Director of Public Prosecutions, the Australian Federal Police (AFP), AUSTRAC, Attorney-General's Department with the support of the Australian Government Solicitor. The funding commenced in February 2006 to allow the project to run through to June 2010. Additional funding totalling $198.9 million has since been provided through to 2014-15.
- Project Wickenby will address a significant threat to the integrity of the Australian taxation system. Investigations and audit activity as at 2005 identified extensive Australian participation in the arrangements, which are promoted and implemented by offshore providers and implemented by domestic promoters. The arrangements are tailored to individual circumstances and rely on falsity, international complexity and confidentiality to create false deductions or conceal income.
Objective and outcomes
- The overall objective of Project Wickenby is to make Australia unattractive for tax fraud and evasion, as both promoters and potential participants perceive the risk/benefit ratio as weighing heavily against them. To achieve this objective, four primary goals have been identified:
a. Reduce international tax avoidance and evasion on the Australian taxation system
b. Enhance strategies and capabilities of Australian and international agencies to collectively deter detect and deal with international tax evasion
c. Improve community confidence in Australian regulatory systems, particularly confidence that the Australian Government addresses serious non-compliance with taxation laws
d. Reform administrative practice, policy and legislation.
Scope
- The scope of Project Wickenby extends to addressing tax mischief associated with the initial identified promoter and other identified promoters of similar arrangements, within the context of the Australian taxation system. Remedies to be applied in addressing the tax mischief include criminal sanctions such as prosecutions (money laundering or obtaining a financial advantage by deception) and proceeds of crime action. Civil action includes tax audits, assessment and Tax Administration Act action.
- Where agencies identify practices and issues that affect the revenue systems of other jurisdictions (domestic and international), liaison and cooperation will occur within the context of agreed legal and administrative arrangements.
- In the course of their investigations, agencies may identify practices that contravene laws other than taxation. For example, ASIC may identify and action structures contravening the Corporations Act 2001 that are directly, indirectly, or not at all associated with the tax mischief. The extent to which these are addressed under the umbrella of Project Wickenby will be considered on a case-by-case basis taking into consideration the objectives of Wickenby, interdependencies and any other factors deemed relevant.
Strategic approach
- The strategic focus is to maximise the incentive for voluntary disclosure and establish a strong deterrent to future promotion and participation. The immediate focus will be to take decisive action against involvement with the initial promoter, before leveraging off this capability to address involvement with other promoters of similar arrangements. Continued progression of criminal cases already with the ACC, and deploying multi-agency capabilities to address other initial promoter cases involving serious tax avoidance and evasion, will send a strong signal to the community regarding the government's intentions.
- Project Wickenby's strategy takes into account the ATO's compliance model by taking firm action against those setting out to avoid their responsibilities. The strategy recognises full voluntary disclosures should be encouraged, while behaviours involving avoidance, evasion and serious fraud must be treated firmly but fairly.
- Project Wickenby agencies have a substantial range of powers to assist in the investigation and prosecution of conduct associated with international tax mischief. Available methods include:
- letters
- notices
- access visits
- search warrants
- examinations
- audits
- proceeds of crime recovery
- taxation assessments
- action for breaches of taxation and corporation laws
- criminal prosecutions of serious and summary matters.
- Participating agencies will use the full range of available approaches and remedies to address the international tax mischief. A differentiated strategy will be used with tougher actions and penalties applying to those more egregious cases. The choice of approaches will take into account relevant factors, including:
a. levels of available information
b. encouraging voluntary disclosure
c. the degree and type of mischief encountered
d. cost-effectiveness, including expeditious treatment where practical
e. the potential leverage.
Agency roles
- Project Wickenby is a joint project involving the ATO, the Australian Crime Commission, Australian Federal Police, Australian Securities & Investments Commission, Commonwealth Director of Public Prosecutions with the support of the Australian Transaction Reports and Analysis Centre (AUSTRAC), the Attorney-General's Department and the Australian Government Solicitor. The Commissioner of Taxation is the administrator of the Australian Government's taxation laws. Therefore, the ATO is the lead agency for the overall project.
- The ATO will obtain information, conduct analysis, investigations and audits, while supporting prosecutions of criminal and civil matters arising from the initial promoter and other promoters. An initial risk assessment of the other international promoters will guide the selection of promoters and/or individuals for further investigation and/or review, and subsequently the involvements of multiple agencies where warranted.
- The role of each agency is recognised and, subject to each agency's statutory powers and functions, includes but is not limited to:
a. The ACC conducts criminal investigations and manages ensuing litigation. Additionally the ACC provides the deployment of an additional examinations team to assist AFP and the ATO by leveraging the use of coercive powers to accelerate the dismantling of organised syndicates. The ACC is also collecting and analysing intelligence that will improve the knowledge and understanding of how offshore organised tax fraud schemes operate and how these activities can be counteracted.
b. The AFP conducts criminal investigations including other high risk international promoter schemes referred by the ATO. The AFP's focus includes key organisers and facilitators of tax fraud, as well as higher risk taxpayers involved in these schemes.
c. The CDPP conducts prosecutions resulting from Project Wickenby and is involved in cases, where appropriate, as early as possible. Prosecutorial activity includes summary offences, proceeds of crime actions and complex criminal prosecutions.
d. ASIC reviews international structures to advise on the application of corporations legislation, such as substantial shareholding provisions, market manipulation, takeover provisions or directors' duties. Subject to restrictions on dissemination of information, ASIC may take its own enforcement/regulatory action.
e. The Australian Government Solicitor provides high level advice in relation to legal risks and potential civil proceedings taken by or against the Commonwealth or any joint agency. Where the Australian Government Solicitor is the legal services provider for such civil proceedings or for any of the joint agencies, it manages and coordinates those proceedings in line with Project Wickenby strategic objectives.
f. AUSTRAC provides online access to its data holdings to the ATO, AFP, ACC and ASIC under the terms of the memorandum of understanding between AUSTRAC and these agencies. AUSTRAC has recently been funded to provide analytical support.
g. The Attorney-General's Department manages mutual assistance requests for formal assistance from other national governments on criminal investigations and prosecutions.
Cross-agency arrangements
- Project Wickenby Cross-Agency Advisory Committee - The ability of the Australian Government to address this attack on the revenue system is highly dependent on all the agencies having the collective capability to respond and collaborate. In order to achieve a whole-of-government approach, a Project Wickenby Cross-agency Advisory Committee has been established, that meets monthly to:
a. Identify and advise the CEOs of each agency on strategic risks, approaches, cases and other matters relevant to Project Wickenby.
b. Share knowledge on methods, and develop and propose cross-agency approaches, including international liaison.
c. Assist and oversee the development and maintenance of cross-agency plans and reports for Project Wickenby.
d. Identify and advise the relevant person/body of legislative and other impediments to Project Wickenby.
e. Identify and facilitate improvements in cross-agency working arrangements and relationships.
f. Assist respective agencies in providing reports and advice to government on Project Wickenby, including assist with any reviews of expenditure that are required by government.
- The ATO, as lead agency, will have primary carriage of reporting to government on Project Wickenby's overall progress, recognising that each agency will also have requirements to report to their own key stakeholders.
- The Project Wickenby Cross-agency Advisory Committee includes senior representatives of each agency and is chaired by an officer nominated by the Commissioner of Taxation. The Committee operates in accordance with statutory frameworks, including information sharing, secrecy and privacy provisions. Administrative support is provided by the ATO.
- Project Wickenby Chief Executive Officers - The Project Wickenby CEO meeting - comprised of CEOs from ACC, AFP, ASIC, AUSTRAC, CDPP and the ATO - meets every six months to review implementation progress and provide high-level governance oversight to the project.
- Other cross-agency cooperative arrangements on needs basis - A variety of other cooperative arrangements are in existence or will be established as required.
Last Modified: Monday, 15 April 2013
|