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  • Tax crime prosecution case studies

    From failing to lodge tax returns to submitting false work-related expenses, we will not tolerate any form of tax crime. The case studies on this page reinforce that people who deliberately cheat the system will be held to account.

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    Latest news

    January 2021 – Fraudulent claims land businessman in hot water

    A business owner who tried to obtain more than $50,000 in fraudulent GST refunds has been sentenced to two years jail. He will be released after serving two months on a $500 recognisance release order to be of good behaviour for the remainder of his sentence.

    Mr Kevin Harker – who was also an accountant – lodged 22 business activity statements (BAS) on behalf of entities he and his wife controlled. But none of the entities were carrying on an enterprise. Mr Harker fabricated the figures on the activity statements to obtain GST refunds totalling $43,834. He also tried to obtain an additional $8,798, which we stopped pending further investigation.

    During an audit, Mr Harker said the entities were involved in producing native bush foods for health food bars. But no tangible product was ever developed or put on the market.

    Accounting files also showed that transactions to support the GST claims were bulk entered after Mr Harker found out about the audit. And there was no evidence in the bank statements to suggest the reported expenses had been paid.

    People who rort the GST system make it unfair on other businesses who operate within the rules. As Mr Harker found out, we won’t tolerate this behaviour.

    December 2020 – Fake tax agent arrested returning to Australia 14 years later

    A fake tax agent who tried to get his hands on more than $60,000 in fraudulent tax refunds has been sentenced to five months in jail.

    Over a period of four months, Mr Ibrahim El-Hassan lodged five false income tax returns on behalf of unsuspecting individuals. Without their knowledge, he would inflate their expense claims to generate a higher refund. He would then pass the original refund on to the individual but keep the difference.

    We launched an investigation in 2006 after a bank employee noticed an account had received two ATO refunds of more than $10,000 on the same day in different names.

    But less than a week after our officers executed a search warrant at his property, Mr El-Hassan fled the country.

    In August 2020, nearly 14 years later, he returned to Australia. Unbeknown to him, Australian Federal Police officers were waiting for him at the airport. We had kept the arrest warrant and passenger alert system open the whole time.

    Mr El-Hassan was immediately arrested and brought before the courts.

    It’s not the first time we’ve been patient and it certainly won’t be the last, with a 19-year tax fraud probe recently ending in jail time. We’re committed, we’re thorough and we’re experts at tracking down tax evaders.

    November 2020 – Fraudster tracked down and held to account

    After two years on the run, a West Australian man has been sentenced to two years and six months jail for attempting to obtain nearly $1 million in fraudulent tax refunds.

    Mr Reece Potter submitted five original and three amended tax returns for the 2012 to 2016 financial years. He falsely claimed he had been working for a meat company that had withheld significant amounts of tax from him.

    As a result of his claims, Mr Potter received four refunds totalling $42,191. We stopped the remaining refunds, amounting to $1,002,745, pending our investigation.

    Mr Potter was originally due to be sentenced in 2018, but he failed to appear in court.

    Two years later, he was located by police in Mandurah and brought before the courts. He will now spend two years and six months behind bars.

    November 2020 – Bank executive busted

    A bank executive from New South Wales has been handed a criminal conviction and fined $1,500 for making false work-related expense claims.

    Mr Mario Seifried lodged two tax returns for the 2016 and 2017 financial years. He falsely claimed a range of car, travel, self-education and other work-related expenses that he hadn’t legitimately incurred.

    For example, in his 2016 income tax return, Mr Seifried claimed to have incurred more than $15,000 worth of travel expenses for ‘conferences overseas’. But Mr Seifried’s employer had no record of him submitting any international or domestic travel requests for this period. Records obtained from the Department of Immigration and Border Protection confirmed that he did not leave the country during the 2016 financial year.

    Mr Seifried also claimed self-education expenses for a course his employer had already paid for and academic study he had already undertaken.

    In total, he wrongfully obtained $24,239 in refunds, which he has now repaid.

    Mr Seifried was charged under the Criminal Code, reflecting the seriousness of his offence.

    If you’re thinking of claiming work-related deductions, remember to follow the three golden rules:

    • you must have spent the money yourself and weren’t reimbursed
    • it must directly relate to earning your income
    • you must have a record to prove it.

    November 2020 – Bricklayer behind bars

    A Queensland bricklayer has been sentenced to two years and six months jail for evading nearly $100,000 in tax.

    Over the course of a year, Mr Ben Ogden reported sales of $85,359 in his quarterly business activity statements (BAS). But an audit found he had actually received more than four times this amount. This resulted in a GST shortfall of $26,570.

    Data from the taxable payments reporting scheme (TPRS) also showed that he had quoted the Australian business number (ABN) of his bricklaying trust to a number of entities, despite telling us it was no longer trading.

    In addition to this, Mr Ogden understated income on his tax return, causing a tax shortfall of $70,441.

    Paying the right amount of tax is part of running a business. We know that most people do the right thing. People who try to evade or cheat the tax system will be caught and will be held to account.

    October 2020 – Tax cheat caught and convicted

    A South Australian woman has narrowly escaped jail after making a series of false claims on her 2015 and 2016 tax returns.

    For the 2014–15 financial year, Ms Jennah Gordon significantly overstated both the amount of money she had earned and the amount of tax her employer had withheld from her. She also made a number of false claims relating to work-related car, clothing, self-education and other expenses. As a result, she received a tax credit of $1,430 that she wasn’t entitled to.

    The following year, Ms Gordon made an amendment to her 2015 tax return. She inflated the amounts for ‘salary and wages’ and ‘tax withheld’ even further to obtain a larger refund. She also lodged another false tax return for the 2015–16 financial year. These refunds weren’t paid as we had already commenced an audit.

    During the audit, Ms Gordon provided us with a false payment summary and an altered bank statement to support her claims.

    Records obtained from Ms Gordon’s employer showed that she earned no income during 2015–16. However, she did receive Centrelink payments, which she had failed to declare.

    Ms Gordon was subsequently sentenced to eight months jail to be released forthwith on a 15-month good behaviour bond. She was also ordered to pay reparations of $4,316.

    Whether it’s a few thousand dollars or a few million dollars, when people claim a refund they’re not entitled to, they’re stealing from the community and disadvantaging everyone who does the right thing.

    We won’t tolerate this behaviour.

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    Last modified: 02 Feb 2021QC 58778