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  • Tackling enablers of tax evasion on the world stage

    Australia’s role in the Joint Chiefs of Global Tax Enforcement (J5) is already reaping results, with significant progress made on identifying operational targets through improved partnerships in just the first few months of the alliance.

    Deputy Commissioner Will Day said the J5 has announced they are working together to actively pursue a number of professional enablers suspected of facilitating significant tax fraud across international boundaries.

    “The ATO has shared intelligence within the alliance to identify areas of mutual interest and is now working on how we address and disrupt the actions of these enablers.

    “As this activity is on ongoing we cannot make any further comment at this time,” he said.

    As a member of the J5 alliance, the ATO continues to build a more comprehensive and accurate understanding of financial crime networks across Australia, the UK, US, Canada and the Netherlands.

    “We are committed to sharing our expertise and exploring new ways of working with our international partners to ensure there is a truly transnational approach to combatting tax crime.

    “Representatives from the ATO joined the J5 ‘Challenge’ in the Netherlands this week to demonstrate our sophistication in using data and analytics on the world stage,” Mr Day said.

    Mr Day said the ATO contributed seven datasets to the Challenge, and was represented by data scientists, data analysts and experts in network analytics and dataset and financial crime domains.

    “The Challenge was an important next step in working with our international colleagues to develop tools and data analysis in real-time to strengthen our combined ability to disrupt enablers of financial crime.

    “We are piecing together the international jigsaw to reveal previously unknown connections, risk areas and behaviours, and expose targets for multilateral action.

    “This is a timely reminder that those who promote tax evasion schemes can no longer promise secrecy to their clients,” he added.

    In working with the J5, the ATO and Australian Criminal Intelligence Commission build on the significant data holdings and data-matching programs in Australia, which increases our capacity to uncover activities that might previously have gone undetected and target serious criminal behaviour.

    J5 Countries host data 'Challenge', Close in on Enablers of Tax Evasion

    The Joint Chiefs of Global Tax Enforcement (J5) have this week brought together their leading data scientists, technology experts and investigators in a coordinated push to track down those people who make a living out of facilitating and enabling international tax crime.

    The event, known as ‘The Challenge,’ was hosted by the Fiscal Information and Investigation Service (FIOD) in Amsterdam to identify, develop, and test tools, platforms, techniques, and methods that contribute to the mission of the J5. The Challenge focused on identifying professional enablers facilitating offshore tax fraud and financial crime posing a threat to the J5 jurisdictions.

    Experts from each country gathered with the mission of optimizing data from a variety of open and investigative sources available to each country, including offshore account information. Using various analytical tools, the teams were tasked to find schemes, identify potential enablers, and propose actions to J5 leadership to address these threats.

    At the conclusion of ‘The Challenge,’ each team identified new targets of investigations, developed investigative schemes to address those targets and increased their ability to share information and find similar patterns and targets in the future.

    “Financial crime goes across borders,” said Hans van der Vlist, General Director of FIOD. “That is why operational collaboration is essential and possible. The J5 is a great example. The goal of this challenge is to define unknown professional enablers of tax fraud and financial crime.”

    In addition to the Challenge, the J5 has already identified and is actively pursuing a number of professional enablers suspected of facilitating significant tax fraud across international boundaries. J5 partners are now working jointly to tackle each of these enablers through coordinated international action. These individuals were identified through intelligence sharing between J5 members since the alliance was formally announced (PDF 212KB)This link will download a file earlier this year in Montreal, Canada.

    The J5 has also made progress in identifying websites that enable fraud through the promotion of schemes to hide income and assets offshore. J5 partners have shared intelligence and capability to collectively close in on these enablers by monitoring their users and using that in their investigations into those involved in these schemes.

    These operations are in addition to, and enhance, the ongoing work of J5 partners to disrupt and deter businesses and individuals from enabling tax crime. For example:

    • Her Majesty’s Revenue and Customs (HMRC) currently has more than 200 enablers under active criminal investigation, and has recently made legislative changes and received investment to allow it to do more.
    • The ATO is currently leveraging the Tax Avoidance Taskforce, Serious Financial Crime Taskforce and Phoenix Taskforce to catch enablers and facilitators and hold them to account for their actions in order to protect the Australian economy.
    • FIOD is combining forces with the police to focus on organised crime and money laundering facilitated through financial arrangements.
    • The IRS continues to investigate enablers operating both inside and outside the United States, focusing on tax and money laundering violations as it relates to violations of U.S. law. Further, the IRS continues to support investigations by fellow J5 members by providing information on countless individuals and fugitives who facilitated offshore tax evasion.
    • The Canada Revenue Agency (CRA) has specifically identified promoters of tax schemes, including enablers, as one of the top operational priorities of its criminal investigations program the CRA is currently investigating over 15 cases involving promoters of tax schemes and more than 50 cases linked to offshore tax evasion.

    Leaders of tax enforcement authorities from Australia, Canada, the Netherlands, the United Kingdom and the United States established the joint operational alliance known as the J5 in mid-2018 to increase collaboration in the fight against international and transnational tax crime and money laundering. For more information about J5, please visit Link.

    Last modified: 09 Nov 2018QC 57321