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  • Serious financial crime case studies

    While the majority of people comply with their tax obligations, there are a small number of people who deliberately do the wrong thing. The joint-agency Serious Financial Crime Taskforce (SFCT) was established to respond to this, targeting the more serious financial crimes in Australia.

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    Two decades. Two agencies. One investigation.

    On 17 August 2020, Philip Northam faced the Brisbane District Court for his involvement as a key promoter in an intricate asset stripping arrangement.

    He, and four other men who have previously been sentenced, initially touted that all tax laws are invalid and that no-one (persons or companies) need legally pay any tax. Their clients with companies that owed tax soon found that, despite their claims, we were pursuing those companies to recover the company tax owed.

    The fraudsters then established an intricate asset stripping arrangement to strip Australian companies of their assets and leave them in a position where they were unable to pay their tax liabilities.

    The illegal scheme offered companies with a tax liability a way to transfer all assets of the company to directors and shareholders, leaving the company unable to pay its tax. Once the assets of the company were stripped, the company was dissolved and new directors and shareholders were put in as straw entities that had no means or intention to pay the tax liabilities.

    Northam was sentenced to six years jail for his involvement in the scheme. This case demonstrates our commitment to maintaining the integrity of our tax system by catching those who evade their tax obligations no matter how long it takes.

    The conviction of the fifth and final fraudster has brought the 19-year-long joint tax fraud investigation by the Australian Taxation Office and Australian Federal Police to a close. The investigation also resulted in almost $4.5 million of lost revenue being recovered. We are tenacious when it comes to taking legal action against people who deliberately facilitate tax evasion arrangements.

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    Second sentencing for Australia's largest tax fraud case

    On 29 March 2018, Michael Issakidis faced the Supreme Court of NSW for his involvement in the largest prosecuted tax fraud case in Australia’s history.

    Alongside his co-conspirator Anthony Dickson, Issakidis deliberately absorbed $450 million of otherwise assessable income through the use of complex domestic and international trust and tax evasion structures, causing a loss to the Commonwealth of $135 million. By creating a web of false identities and siphoning money offshore, the pair acquired approximately $63 million.

    Issakidis was sentenced to 10 years and three months jail for his involvement in the operation. This followed the 2015 sentencing of Dickson, whose original 11-year sentence was increased to 14 years on appeal.

    The significant penalties handed down to both Issakidis and Dickson demonstrate the success of the Serious Financial Crime Taskforce (SFCT) in dealing with those who deliberately cheat the system. As a member of the SFCT, the ATO is equipped with the resources, data-matching capability and international and domestic intelligence-sharing relationships to uncover even the most complex tax evasion schemes.

    People who deliberately avoid paying the correct amount of tax will be caught and will face the full force of the law.

    This infographic provides more detail about how the scam was set up and where the funds were moved to – The scam – How it was set up (PDF 271KB)This link will download a file.

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    Last modified: 24 Aug 2020QC 58431