AFP busts business that allegedly washed $1bn for 1.2k tax evaders
The ongoing investigation is part of the ATO-led Serious Financial Crime Taskforce’s crackdown on false invoicing schemes.
The AFP has seized $500,000 from a Sydney-based cheque-cashing business that allegedly laundered over $1 billion in profits from tax evasion.
The operation was suspected to have used false invoicing arrangements to help over 1,200 businesses “from a range of industries” avoid tax and super obligations, the AFP said in a statement with the ATO.
The AFP launched the investigation as part of the Serious Financial Crime Taskforce (SFCT), led by the ATO.
AFP Detective Acting Superintendent Jim Rowe said authorities were committed to dismantling the operations of businesses that robbed Australians of money through financial crime and tax fraud.
“The AFP works closely with the ATO to ensure people who cheat the tax system or enable others to avoid their obligations are not rewarded for their conduct,” he said.
The AFP executed seven search warrants in Sydney on Friday, while the ATO made “Access Without Notice” (AWON) visits across five sites in NSW and Victoria.
Searches occurred in residential and business properties located in Liverpool, Beverly Hills, Kingsgrove, Cabramatta and Earlwood.
Officers seized more than $500,000 in cash, financial documents including fraudulent invoices, electronic devices, mobile phones, a gel blaster firearm and fireworks, the AFP said.
A 55-year-old man was also arrested, charged with a breach of bail for an unrelated offence. He was refused bail at Bankstown Local Court on the same day.
The fraudulent invoices found by police suggested the cheque-cashing business falsely provided goods and services in return for business funds in electronic or cheque form, the AFP said. The participating business then received their funds back as cash, minus a commission, in a false invoicing arrangement.
“Our investigative team – which is made up of highly skilled investigators, forensic accountants and technical experts – work diligently to ensure that anyone responsible for financial crime is brought to justice,” Rowe said, with investigations ongoing.
ATO deputy commissioner and SFCT Chief John Ford said the ATO was committed to cracking down on false invoicing arrangements.
“The SFCT is warning businesses against using these types of arrangements. We will effectively deal with those who engage in false invoicing, or other illegal financial arrangements and work with partner agencies where appropriate,” he said.
“We encourage those involved in false invoicing arrangements to come forward and make a voluntary disclosure.”
False invoicing arrangements have been a key focus area for the SFCT. Following the bust on Friday, the ATO issued a statement discussing the schemes and said it was equipped with “the resources, sophisticated data matching, analytics capability, and intelligence sharing relationships to uncover even the most elaborate financial crime”.
The ATO asked community members who suspected a business or individual involved in a false invoicing arrangement to confidentially report a tip-off.
It said arrangements often involved issuing invoices without providing any goods or services and fraudulently claiming deductions and GST input tax credits from the invoice.
Additionally, the ATO said it was monitoring situations where business owners used the cash they received for private purposes or to pay cash wages to workers, and failed to report the amounts in their tax returns.
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