AFP busts $17m payroll money laundering scheme
Australian Federal Police executed search warrants at 10
locations across Sydney, nine in south-east Queensland and two in the ACT in a
co-ordinated strike against a transnational and serious organised criminal
syndicate using labour hire and payroll companies associated with the building
and construction industry to defraud the Commonwealth.
Charges have been brought against 12 people, include a
49-year-old man from Surfers Paradise, who is alleged to be the director of
this organised crime syndicate comprising of a mix of financial industry
experts and former bankers.
It will be alleged in court that the syndicate had effective
control of labour hire companies undertaking legitimate work in the building
and construction industry.
The syndicate then outsourced the processing of their
payroll services to separate payroll companies, which they allegedly also
operated for the sole purpose of not paying mandatory pay-as-you-go withholding
(PAYGW) tax to the ATO.
Employee and contractor wages, superannuation and insurance
were correctly paid, but money allocated to be paid to the ATO for tax
obligations was diverted and allegedly laundered through a variety of other
entities.
The total value of the fraud has been calculated at more
than $17 million since July 2018.
When a substantial tax debt was accrued by these payroll
companies, the syndicate would abandon them and create new payroll companies in
an attempt to continue the fraud and conceal their illegal activities.
These funds were moved through other entities in an attempt
to disguise its origin, before eventually being transferred into bank accounts
controlled by syndicate members and their associates, including those belonging
to a senior member of an Outlaw Motorcycle Gang (OMCG) and the partner of an
organised crime figure currently in prison.
The AFP has now restrained assets allegedly belonging to the
criminal syndicate, including 12 real properties, 17 motor vehicles, 65 bank
accounts, a caravan and a boat with a total value of approximately $21 million.
The Singapore Police Force have also assisted the AFP in
identifying and restraining approximately $1.3 million held in Singapore bank
accounts.
The joint agency investigation included the ATO and ASIC as
part of the Serious Financial Crime Taskforce (SFCT) as well as assistance by
major banks ANZ and Westpac.
AFP Commander Investigations, Eastern Command, Kirsty
Schofield said yesterday’s activity demonstrated how the SFCT have developed
new methods to counter complex fraud.
“Transnational and serious organised crime groups are
evolving. No longer do they target any specific crime type or commodity, they
adapt to their environments by recruiting professional enablers to provide
experience in the financial, legal or any other field they feel can earn them
money,” Ms Schofield said.
“This investigation is just one example of how the AFP stays
ahead of these groups, formulating innovative techniques to combat the complex
and rapidly changing environment of organised crime in Australia.
“The AFP is always looking to outsmart these organised crime
groups — we make sure we have investigators with specialist skills and look to
work with partner agencies and private industry to counter a broader range of
criminal offending. We will continue to target organised crime at their most
vulnerable, namely when they try to legitimise their illegally obtained
proceeds of crime.”
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