The Australian Federal Police has arrested and charged nine people for their association with a syndicate allegedly responsible for a $165 million tax fraud against the Australian Government.
Officers executed 28 search warrants across Sydney, Woolongong and the Southern Highlands on Wednesday following an eight-month long investigation.
A further six search warrants are being executed today.
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Six people, aged between 24 and 47, were charged with conspiracy to defraud the Commonwealth for their alleged role in the syndicate, while two men were charged with money laundering offences. One was charged in relation to an alleged extortion on the syndicate, which also resulted in additional charges against two people charged in relation to the syndicate.
Another man, a 58-year-old from Menai, was issued a court attendance notice for allegedly abusing his position as a public official, but he was not part of the criminal syndicate.
Police will allege in court that the fraud involved a company established by the syndicate to provide payroll services to legitimate clients.
The money received from these companies was then transferred to subcontracted companies – allegedly controlled by syndicate members – to process payroll. While processing these payments, funds paid by legitimate clients to service tax obligations were allegedly diverted by the syndicate for their own personal gain.
Tax Office investigators estimate the amount of tax obligations not paid to the ATO to be approximately $165 million.
During yesterday’s search warrants, detectives seized assets suspected to be the proceeds of crime, including include luxury houses, funds in bank accounts, luxury cars, boats, motorbikes and aircraft.
AFP Deputy Commissioner Leanne Close said yesterday’s activity involved more than 290 AFP members.
“The scale of this alleged fraud is unprecedented for the AFP; the response from our members yesterday is a direct response to the level of offending that we have identified during this operation,” she said.
“Investigations such as this are inherently complex and we still have a lot more work to undertake as we analyse the material that has been seized.
“The threat posed by this syndicate to the revenue stream is demonstrated by the fact that $165 million was removed from the tax system, ultimately removing it from possible use by the community.”