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  • Tax crime prosecution case studies

    From failing to lodge income 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 those who deliberately cheat the system will be held to account.

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    Latest news

    September 2020 - 130 false lodgements land former tax accountant in jail

    A former tax accountant who falsified his clients’ income tax returns in order to net $179,826 has been sentenced to one year and eight months jail.

    As an employee of Fast Refund, Mr Hussain Nazeer lodged 22 false income tax returns on behalf of 14 clients. Without their knowledge, he altered his clients’ expense claims to increase the refund they were entitled to. Mr Nazeer then passed the original refund onto his client, but pocketed the inflated difference.

    He also lodged 108 amendments on behalf of 37 clients, making a number of false claims in relation to work-related car expenses and medical expenses. The resulting refunds, which amounted to more than $150,000, were deposited into the Fast Refund bank account, which Mr Nazeer had joint control over. The funds were then transferred into a range of personal bank accounts that he was associated with.

    Mr Nazeer’s clients had no idea that any amendments had been made in their name until they were contacted in the course of our investigation.

    When he faced the Sydney District Court on 4 September, Mr Nazeer was ordered to pay the full amount back in addition to his jail term.

    The seriousness of this sentence confirms that tax professionals who abuse their position of trust will face the full force of the law.

    August 2020 – Queensland restaurant owner convicted

    A restaurant owner who falsified his business activity statements (BAS) to obtain a financial advantage of $90,628 has been convicted and fined $40,000.

    Mr Ersoy Isik was the director of three entities that operated restaurants in the Brisbane area.

    Between July 2011 and June 2012, Mr Isik engaged the services of an accountant and a bookkeeper to help him with his business tax affairs.

    But when it came time to lodge, Mr Isik made multiple false statements for each of the three entities, deliberately understating sales and overstating acquisitions.

    Evidence obtained at audit confirmed that there was a discrepancy between what the bookkeeper had recorded in the ledgers and what Mr Isik had authorised his accountant to declare in the BAS.

    Even if you use a tax or BAS agent, you are responsible for the tax records you provide to them. If you’ve made an honest mistake or are falling behind on your obligations, we will work with you to find a solution. But people who deliberately set out to cheat the tax system will be held to account.

    July 2020 – BAS agent busted

    A former Queensland BAS agent has been sentenced to three years jail after using her clients’ identities to obtain fraudulent refunds.

    Over a period of two years, Ms Alana Hodge lodged 47 false business activity statements (BAS) on behalf of seven unsuspecting clients.

    In each case, she would change the bank account details and contact details on their ATO client account, before lodging false statements in their name.

    Often, she would wait until the company had ceased operating to commit the fraud, but in some instances, it took place during the course of her employment.

    In total, Ms Hodge obtained $192,140 in fraudulent GST refunds. She also attempted to obtain an additional $65,056, but these refunds were stopped by our officers.

    When the matter was referred to the Commonwealth Director of Public Prosecutions (CDPP) for prosecution, Ms Hodge was charged with 47 counts and sentenced to three years jail. She was also ordered to pay reparations.

    As the outcome of this case highlights, we are committed to protecting the community from the small number of tax professionals who abuse their position of trust. Small businesses like the ones Ms Hodge targeted have enough to think about without having to endure the emotional and financial stress of an unethical BAS agent.

    If you are concerned about the conduct of a tax practitioner you can report them to the Tax Practitioners Board at https://www.tpb.gov.au/make-complaintExternal Link.

    July 2020 – Fishy business lands seafood farmer behind bars

    A 49-year-old man who netted himself nearly $600,000 in fraudulent GST refunds has been sentenced at the Brisbane District Court to three years and six months jail.

    Over a period of three years, Mr Brian Russell purchased a number of businesses and purported to develop them into profitable enterprises. But despite claiming a significant amount of input tax credits, plus the available research and development (R&D) grants, he didn’t progress with any of the businesses.

    Further investigation revealed that across the three entities – two involving seafood farming – Mr Russell made false claims totalling more than $8 million.

    In some instances, he had attempted to cover his tracks by seeking ‘pro-forma invoices’ for equipment he never intended to purchase. But our criminal investigation officers were able to uncover this.

    Mr Russell was convicted on 40 counts and will now spend time behind bars.

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    Last modified: 14 Sep 2020QC 58778