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Understated business income: Mineral Resources tax scandal

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Understated business income: Mineral Resources tax scandal

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Who were the victims of the crime?
The victims included Australian taxpayers and the broader community because unpaid tax reduces the revenue available for public services. Mineral Resources shareholders were also affected because the conduct damaged confidence in the company’s leadership and governance.

What was the impact of the crime in terms of monetary losses?
Chris Ellison paid the Australian Taxation Office almost $4 million in unpaid taxes. The Mineral Resources board also ordered him to pay $8.8 million in financial penalties to the company and decided not to pay almost $10 million in planned executive remuneration.

What non-monetary losses did you identify?
The conduct damaged the company’s reputation and reduced trust in its leadership. It also raised concerns about transparency, offshore business dealings and corporate governance.

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1. Who were the victims

of the crime?

The government is a victim, as the revenue from cigarettes and tobacco taxes allows the government to pay for publicly funded services like Healthcare. Legitimate shops and the tobacco industry also suffer as the unfair competitors surpass the markets for consumers. Finally, the consumer/community also suffers from illicit tobacco; the stores that supply the illegal substances may be engaging in other unlawful activities. There is also no quality control, which means that there is no guarantee that the product being distributed is not laced with other substances. These links heighten public health concerns that could compromise public trust in regulatory bodies. (Australian Criminal Intelligence Commission [ACIC], 2023).

2. What was the impact of the crime in terms of monetary losses?

Regarding the monetary losses, the Australian government will lose billions of dollars every year in unpaid tobacco taxes. This decrease reduces the finances available for services like public hospitals, public transport, and law enforcement.(ACIC, 2023; KPMG, 2022)

3. What

Non-monetary losses did you identify?

Public Health Risk - often unregulated and may contain harmful products

Disrupting tobacco legislation and policies - making smoking products more accessible allows minors ( under 18 years of age ) to purchase and consume the products

Increase in crime activity - violence, corruption, tax evasion, extortion, and money laundering

Societal harm - reducing the community's trust in regulatory boards and law enforcement.

REFERENCES

Australian Criminal Intelligence Commission. (2023). Illicit tobacco in Australia. https://www.acic.gov.au

KPMG. (2022). Illicit tobacco in Australia report. https://home.kpmg/au

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$5.8 Million NDIS & Tax Fraud Case (Sydney)

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$5.8 Million NDIS & Tax Fraud Case (Sydney)

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1. Who were the victims of the crime?

Australian Taxpayers, who subsidise services impacted by this fraud

NDIS - who are left with less funding to support those with a genuine need

Disability community requiring support

2. What was the impact of the crime in terms of monetary losses?

$5.8million loss to NDIS

Demonstrating the large scale of some fraudulent activity

Cost of running Operation Pegasus to seek out such fraud

3. What non-monetary losses did you identify?

Reputational damage to NDIS/ATO for not having stronger mechanisms in place to detect fraud.

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Three fraudsters sentenced for $5.8 million fraud against NDIS and ATO

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Three people based in Sydney have been sentenced to multiple years imprisonment for their roles in defrauding $5.8 million from both the National Disability Insurance Scheme (NDIS) and Australian Taxation Office (ATO).

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SA woman who falsely claimed welfare payments operated under alias Valentine Fox, court told

SA woman who falsely claimed welfare payments operated under alias Valentine Fox, court told - ABC News

1. Who were the victims of the crime?

Patricia Shirlene Dianna Hughes received double the amount of welfare payments due to double dipping under an alias name Valentine Fox. The victims are the vulnerable communities and individuals who missed out on access to welfare support of service. Also, taxpayers as well as Commonwealth who funds were misused.

2. What was the impact of the crime in terms of monetary losses?

$200,000 in welfare payments from Centrelink misused by the offender and people in her life.

3. What non-monetary losses did you identify?

Loss of the community trust in the Commonwealth system indicating that proper due diligence was probably not conducted resulting in the misuse of Taxpayers funds over 12 years.

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A South Australian woman who falsely claimed more than $200,000 in welfare payments from Centrelink was "double dipping" under the alias Valentine Fox, a court has heard.

Patricia Shirlene Dianna Hughes pleaded guilty to obtaining a financial advantage by deception

The Commonwealth's lawyer, Helen Luu, confirmed Hughes was "double dipping from the welfare system"

Hughes's lawyer, Paul Charman, said other people in his client's life were spending some of the money she received

Patricia Shirlene Dianna Hughes pleaded guilty to obtaining a financial advantage by deception over welfare payments she received for more than 12 years.

In Adelaide's District Court on Tuesday, representing the Commonwealth, Helen Luu, told the court during sentencing submissions that Hughes had received welfare payments under her real name and under her alias.

"At the same time this money was being received, Ms Hughes also received benefits in her own name, which she was entitled too," Ms Luu said.

"So it's not a case of simply just receiving this money in the alias's name without any additional funds from the Commonwealth."

Judge Anthony Allen questioned whether it was a case of "double dipping from the welfare system", which Ms Luu confirmed.

Ms Luu argued that the character references provided for Hughes, which defended her "integrity and honesty" should not be given weight as they referred to her as Ms Fox and that they were possibly not aware of her actions at the time.

Judge Allen also asked Hughes's lawyer, Paul Charman, to explain a written submission from the 47-year-old, which claimed that she was "a pawn in this scheme and that she didn't benefit from it".

Mr Charman argued that other people in his client's life were spending some of the money she received.

"Some of those others had access to the moneys that came in," Mr Charman said.

"That does not mean that she's not responsible for the actions she took, it simply means that while she received all the benefit from the Commonwealth - what she was saying was that 'I didn't actually get anything out of this'."

Mr Charman told the judge that Hughes had not spent the money on "drugs or poker machines" but rather spent it on day-to-day living expenses.

Judge Allen agreed, estimating that the $200,000 she had received would have equated to approximately $1,200 a month, over the estimated time frame.

Hughes still owes the Commonwealth $190,000, lawyer says

Mr Charman said it was clear from Hughes's living standards and her bank records that she was being "controlled" by others.

"She lives in a house, which is partially burnt down with a friend who is far more psychologically traumatised than she is," he said.

"Between the two of them, they barely leave the house and haven't done so for years.

"There is almost a complete disconnect from the outside world."

Mr Charman told the court that the defendant had made multiple attempts to sell her "partially burnt-down house" in Myponga to remunerate the Commonwealth, but had so far not had any luck.

Mr Charman said his client had paid off some of the remunerations, but still owed the Commonwealth $190,000.

He asked the judge to consider a "merciful non-parole period" for Hughes because his client was "petrified" of prison given her "unique personal circumstances".

A psychological report of Hughes found that she suffered from chronic PTSD, depression, and anxiety, and that she considered herself "a complete waste of space".

Judge Allen did not dispute the claims that Hughes had "lived an extremely difficult life" and said he would consider the proposition that her "catastrophically damaged psychological state" and the influence of others contributed to her offending.

However, Judge Allen said that he would also need to consider a general deterrent against committing such crimes when he delivered his sentence.

The 47-year-old will be sentenced in August.

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'Double dipping' woman who falsely claimed Centrelink money operated under an alias, court hears

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The Adelaide District Court hears Patricia Shirlene Dianna Hughes was operating under the alias Valentine Fox while "double dipping" from the welfare system and falsely claiming $200,000 in Centrelink payments.

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The Tinder Swindler

Who were the victims of the crime?

Women on a dating app

What was the impact of the crime in terms of monetary losses?

Multi-million dollar cybercrime

What non-monetary losses did you identify?

Profound emotional and psychological impact - depression, anxiety, and post-traumatic stress disorder

Intimacy and affection exploitation

Profound sense of betrayal, emotional turmoil

Persistent mistrust in future relationships

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Who were the victims of the crime?

Legitimate business owners targeted by criminals.

Community members requiring health services, impacted be reduced excise income.

All Australian taxpayers, who have to subsidise services impacted by reduced excise income.

What was the impact of the crime in terms of monetary losses?

Loss of ~$9B in excise revenue over 5 years.

Organised crime is making about $10 billion a year in revenue from illicit tobacco sales

Excise-evading cigarettes now comprise half of smoking products sold to Australia's 2.7 million smokers. This has a significant impact on Australia’s health system funding.

Loss of income to surrounding business impacted by regular fire-bombings, creating a sense of fear in the community and an inability to trade.

What non-monetary losses did you identify?

Loss of life – Employees of illicit tobacco sellers have been assaulted and murdered.

Spikes in crime as criminals reap the benefits of increased revenue, leading to reduced community safety and confidence in law makers and law enforcement.

Reduces health services / service quality as a result of reduced income from excises.

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Australia’s illegal tobacco problem has jumped from tragedy to farce

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We can now conclude that the strategy of taxing and banning nicotine addiction out of existence is a complete failure. The result is organised crime making about $10 billion a year in revenue.

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1. Who were the victims

of the crime?

Australian community as a whole is victim of this crime. There was loss of government revenues which could have been used for providing essential services to the community and many of the illegal cigarettes end up in hands of minors, causing further harm.

2. What was the impact of the crime in terms of monetary losses?

Loss of tax dollars in addition to cost of policing this activity are two major monetary losses identified in this.

3. What

non-monetary losses did you identify?

Effect on health of minors and community and reputational loss for the country due to illegal activities taking place inside their borders.

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1. Who were the victims of the crime?

·         Government (reduced tobacco excise revenue and likely reduced GST and income tax)

·         Business selling legal tobacco (reduced income)

·         Local communities (criminal activities linked to illegal tobacco including firebombings, violent robberies, murders)

·         Individuals (health impact due to cheaper tobacco being easily available)

2. What was the impact of the crime in terms of monetary losses?

·         This year's federal budget contained an estimate of $7.4 billion from tobacco excise for the current financial year, down from $8.75 billion just six months ago in MYEFO.

·         Additional costs to fight the issue: $86.3 million a year budgeted by the Cth Government for its "Illicit Tobacco Compliance and Enforcement Package".

·         ATO: GST / Income tax losses due to undeclared sales (illegal tobacco) and reduced sales of legal tobacco.

·         Business selling legal tobacco losing income: for example Viva Energy, reported that tobacco sales were down 27 per cent because of the growth in the illicit tobacco trade.

·         Insurance / business / property owners’ costs: when a shop is torched. May also include WHS claims by employees linked to fires and robberies.

3. What non-monetary losses did you identify?

·         Increased criminal activities putting pressure on stretched law enforcement.

·         Potential for some businesses to have to close, or reduce their activity, if a large proportion of their income is linked to tobacco (e.g.petrol stations). This may be especially concerning in smaller towns.

·         Stress, trauma/PTSD for people (e.g. employees, neighbours, customers) that have been affected by firebombings and violent robberies.

·         Impact on communities and local councils, especially in smaller towns, where criminal activity may result in negatively impacting town’s reputation.

·         And it seems that (according to studies of wastewater) nicotine consumption in Australia is at an all-time high. Therefore there will be health impacts on individuals (and long-term increased costs to the health system).

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Australia’s illegal tobacco problem has jumped from tragedy to farce

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We can now conclude that the strategy of taxing and banning nicotine addiction out of existence is a complete failure. The result is organised crime making about $10 billion a year in revenue.

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1. Who were the victims of the crime?

The Australian Government / ATO who lost revenue

The employees who the charged man withheld the PAYG payments of as they would have had serious tax implications including acquiring tax debts, tax records showing unpaid tax and problems accessing superannuation if unpaid tax remained on their record

The struggling businesses who were taken over by the charged man

2. What was the impact of the crime in terms of monetary losses?

The cost to the ATO totalled $845,066 in revenue which in turn would affect public interest as the ATO had less money to fund public services.

Investigation and prosecution costs to the ATO

Administrative costs to the ATO to remediate the tax records of the affected employees

3. What non- monetary losses did you identify?

Stress caused to the affected individuals

Reputational damage to the businesses involved

Lack of confidence from the Australian public in the Government as people would be disheartened that this could occur

Administrative burden to the ATO to investigate, prosecute and remediate the case.

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62-year-old charged for alleged illegal ‘phoenix’ activity | Australian Federal Police

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A long-standing Serious Financial Crime Taskforce (SFCT) investigation led by the Australian Taxation Office (ATO) and the Australian Federal Police (AFP) has seen a 62-year-old man charged in connection with allegations of illegal “phoenix” activity.

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Who were the victims of the crime?

The Australian public who have had their identity used to facilitate these fraudulent loans are the victims in this scenario. Businesses that have provided goods/services as a result of the fraudulent loans and the financial institution providing funding are subsequent victims awaiting frozen assets to possibly recover goods/funds.

What was the impact of the crime in terms of monetary losses?

This investigation is still ongoing and the latest update on the syndicate indicates $53 million dollars in assets has been restrained however the ABS estimates 1.2% or 255,100 persons experienced identity theft in 2023-2024.

The impact also extends to the financial institutions providing funding to fraudulent loan applications.

What non monetary losses did you identify?

The emotional/physical and psychological damage to the individuals who have had their identity stolen and subsequently used for fraudulent loan applications as well as the reputational damage to the financial institutions and luxury car dealerships.

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Man, 66, accused of staging car crashes to claim $390k insurance

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Man, 66, accused of staging car crashes to claim $390k insurance

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1. Who were the victims of the crime?

- Insurance companies involved in paying out fraudulent insurance claims.

- Drivers/Car Owners of vehicles in staged accidents/collisions (including those who may have been complicit).

- Other Australian drivers which may have been caught in the crossfire of the staged collisions or inconvenienced to take longer detours.

2. What was the impact of the crime in terms of monetary losses?

The monetary losses collectively are $390,000 worth of fraudulent insurance claim payouts. Other monetary losses may include the relevant law enforcement budgets and potential revisions or implementations of policies for insurance companies e.g. anti-fraud compliance measures.

3. What non-monetary losses did you identify?

The non-monetary losses include insurance companies' loss of credibility/reputation (may be targeted by those looking to lodge fraudulent claims), government/law enforcement resources in investigating and charging the perpetrator and reduction in available insurance investigators/assessors to resolve genuine insurance claims, wherein genuine customers may have been impacted as a result.

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Man accused of staging car crashes to claim $390k insurance

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A 66-year-old man allegedly staged more than a dozen car accidents over three years to claim insurance money.

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Illegal phoenix activity — where company directors deliberately collapse businesses to avoid debts, only to resurface under a new name — is one of Australia’s most destructive white-collar crimes.

1. Who were the victims of the crime:

Creditors and Suppliers

Businesses and/or individuals who are owed money by a company that has been intentionally liquidated

Employees

Losing wages, superannuation, leave entitlements

Competitors playing fair

Distorts the market and disadvantages those trading responsibly and fairly

2. What was the impact of the crime in terms of monetary losses: in Australia annually, it costs approximately:

$3.3 billion in unpaid debts (leaving small businesses, contractors, and employees out of pocket).

$1.5 billion in lost tax revenue (meaning fewer funding for infrastructure).

3. What non monetary losses did you identify:

Reputational damage in the sector/industry

Lack of integrity or trust in the system/governance

Loss f business relationships

Employment and career damage

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The evil phoenix: Quenching the fire of its rebirth

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This is a $5 billion scam hurting honest Australians.

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Guilty Plea for $130,000 Fraud against Centrelink and proceeds of crime

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Guilty Plea for $130,000 Fraud against Centrelink and proceeds of crime

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1. Who are the victims of the crime?

Ultimately the Australian taxpayers are the victims of this crime, it leads to increased taxes, reduced funding for other much needed government services and ads a strain on government budgets. Unfortunately, losses also directly affect our legitimate welfare recipients. Extra friction and measures need to be put in place to mitigate and eliminate these frauds & as a result can lead to stricter eligibility requirements, increased scrutiny and delays in processing claims and a general stigma against those who genuinely need assistance.

2. What was the impact of the crime in terms of monetary losses?

$137,000 in carers payments were fraudulently obtained 2 years after police had found $250,000 hidden in a safe in her bedroom floor.

3. What non-monetary losses did you identify?

Reputational harm to society at large, creates a feeling of distrust in public institutions and other service providers such as health care providers, especially given this fraud type involves forged documents, in this case medical reports.

Victims of Ms Assie - noted she started to involve others in the "web" would have suffered an impact on their mental health, family life and perhaps carers due to involvement in criminal activity

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news.com.au — Australia’s leading news site for latest headlines

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A Sydney woman is facing up to 13 years in prison after she allegedly masterminded a scheme that defrauded Centrelink of $130,000 — two years after police found $250,000 hidden in a safe in her bedroom floor.

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·       Who were the victims of the crime?

o   People within the community that the sunglasses were going to be sold.

·       What was the impact in terms of monetary losses?

o   The cost of making the sunglasses,

o   The transportation costs to get them from Vietnam to Australia.

o   The purchasing of the sunglasses.

·       What non-monetary losses did you identify?

o   Reputation of the person who brought in the sunglasses.

o   Space in suitcase to bring in legal items.

o   Time losses for both the person that brought in the sunglasses and the border officers.

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The Australian Border Force (ABF) has made a large detection of counterfeit luxury goods at Melbourne International airport.

On 17 September 2023 ABF officers examined and x-rayed the bags of a Morwell man returning from Vietnam, discovering an array of trademark infringing items from sunglasses, accessories, and imitation jewellery.

The fakes were detected within five boxes and included items branded Gucci, Chanel, Prada, Dior, Balenciaga, Versace and Burberry sunglasses; and accessories and imitation jewellery branded Prada, Dior, Louis Vuitton, Cartier, Bvlgari and YSL. A total of 493 counterfeit items were detected.

Superintendent Aviation Traveller Melbourne Airport, Kelly-anne Parish, said ABF officers employ sophisticated detection tools at the border to ensure counterfeit goods do not make it into the community.

"Our message to individuals attempting to bring counterfeit luxury goods into Australia is simple - do not engage in this activity because we will hold you to account and it will result in significant financial penalties," Superintendent Parish said.

Reports of suspected importation of counterfeit goods can be made at Border Watch. Reports can be made anonymously.

"If anyone believes individuals or businesses are attempting to bring counterfeit goods into Australia these concerns can be reported through Border Watch," Acting Superintendent Parish said.

Media contact: Australian Border Force (02) 6264 2211

​

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The Australian Border Force (ABF) has made a large detection of counterfeit luxury goods at Melbourne International airport.

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Who were the victims of the crime?

The victims of the crime include:

-The Australian Community, including:

-Vulnerable peoples (e.g Gambling Addicts).

-Australian Tax Payers.

What was the impact of the crime in terms of monetary losses?

-The illegal offshore market in Australia was worth more than $1 billion, about 15 per cent of the total gambling market.

-They do they pay tax or fees to local sporting and racing bodies.

What non-monetary losses did you identify?

-Illegal offshore gambling providers are not bound by Australia’s consumer protection measures, nor do they pay tax or fees to local sporting and racing bodies.

-Lack of consumer protection and ability to self-exclude

-Reputational damage to australian consumers/companies who are lisenced.

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Australian gambling giants have been accused of deflecting scrutiny of their operations by pointing the finger at overseas unlicensed wagering sites targeting Australian punters.

As the federal government mulls recommendations stemming from the parliamentary inquiry into online gambling, a coalition of the country's biggest bookmakers last week said that industry reform needed to consider the threat of illegal providers.

The illegal offshore gambling market in Australia is worth more than $1 billion. Credit: iStock

"Australia has some of the most progressive regulations in the world, ensuring that consumers are protected, and that money is returned to the Australian economy through taxes and product fees imposed on wagering companies," a Responsible Wagering Australia spokesperson said.

"Claims that the offshore market is not a serious concern does a disservice to Australians and may further encourage people to access offshore markets."

The comments came after the wagering group released analysis, developed by H2 Gambling Capital, on Australia's offshore wagering industry that showed the illegal offshore market in Australia was worth more than $1 billion, about 15 per cent of the total gambling market.

Illegal offshore gambling providers are not bound by Australia's consumer protection measures, nor do they pay tax or fees to local sporting and racing bodies.

But some gambling harm experts argue that although curbing unlawful wagering providers and products was important, it should not take focus away from the need to better regulate locally licensed operators, particularly when some had been found guilty of illegal proceedings abroad.

One Responsible Wagering Australia member, Unibet, which is licensed in Australia and owned by the Kindred Group, spent much of last year locked in a stoush with the Norwegian government over its alleged targeting of Norwegian customers despite lacking a licence to provide online gambling services in that country.

Kindred was fined $63 million by the Norwegian regulator in September. The Norwegian Gambling Authority then increased the penalty to $170,000 a day in December. However, this decision was reversed after Unibet "adapted" its operations in the country, a Kindred spokesperson said at the time.

Kindred and Entain, which owns Responsible Wagering Australia members Ladbrokes and Neds, were found to have illegally accepted Dutch bettors before online gambling became legal in the Netherlands in 2021, and were prevented from holding a licence until 2022 as a result.

Monash University's Charles Livingstone.

Austria's Supreme Court ruled in 2019 that Flutter - the owner of Sportsbet - had been operating casino websites illegally, prompting local gamblers to launch legal action against the giant in an attempt to recoup their losses. There is no evidence to suggest the decisions of the foreign outfits have any correlation with the decisions of their licensed Australian businesses. Entain recently committed to exit all unregulated markets so that 100 per cent of its revenue would come from regulated sectors by the end of this year.

Leading gambling researcher Professor Charles Livingstone, of Monash University, accused the industry of overstating the threat of offshore wagering to deflect attention away from itself. He called for an international regulator to be established to constrict illegal operators instead of allowing locally licensed providers access to provide the banned services.

"The industry tries to use offshore gambling as a way to deflect away from its own misdemeanours, particularly given many of their principals are people providing this illegal gambling elsewhere," Livingstone said. "That's not to diminish the seriousness of it, it needs to be addressed. But there are ways of doing so without giving the current industry carte blanche to do what they like."

The Australian online gambling market reached $6.8 billion in 2022 and is expected to grow by 7 per cent over the next five years. A recent survey from the Australian Gambling Research Centre found about three-quarters of Australian adults gambled at least once over the past 12 months, and almost two in five gambled weekly. A 2019 gambling survey in NSW found two of the least prevalent forms of gambling were betting on online poker and online casino games, with less than 0.5 per cent of the adult population in the state taking part. Almost one in five, or 19 per cent, reported participating in online gambling.

Head of Responsible Wagering Australia Kai Cantwell wants reforms to deter punters from unlicensed overseas outfits.

Responsible Wagering Australia chief Kai Cantwell said last week it was important any future online gambling reform considered the potential for punters to seek out illegal operators as a result. The comments followed Opposition Leader Peter Dutton's assertion that gambling advertisements in sport should be further restricted.

Cantwell said: "It is crucial that any future reforms are balanced and prevent Australian players from being driven offshore, where player protections are limited."

"Additionally, failure to maintain a sustainably regulated sports betting market could result in a significant loss of economic benefits to the Australian economy, as well as to the sporting, racing, and broadcasting industries."

Financial Counselling Australia's Lauren Levin disagreed with Cantwell, and said the issue of unlicensed gambling providers was dwarfed by the need to better protect Australians gambling legally from harm. She argued Australia's consumer protection gambling policy should not focus on the unregulated operators but on a policy agenda centred on preventing consumer harm, particularly for young people.

"In financial counselling casework, we observe that the dominant harm comes from those licensed in Australia [who can advertise heavily]. We observe only a very small amount of gambling with the unregulated, overseas operators. And this is no more harmful than gambling with a licensed provider - money is lost both ways."

She said Australian regulators should work with their overseas counterparts to control illegal operators as the bulk of the unlicensed operators that target Australians hold licences abroad.

"Our regulators need the right powers. In practice, gambling consumer protection is very low in Australia. It's a largely self-serving argument when the industry cites offshore wagering in an attempt to prevent future regulation and regulators should not focus on it," Levin said.

"All they are saying is 'government look over there, keep yourself busy with anything other than looking at what we're doing right now to Australians'."
The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.

Connect via Amelia McGuire is the aviation, tourism and gaming reporter at The Sydney Morning Herald and The Age. Twitter or email.

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How big is the threat of illegal offshore wagering?

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Some of the country's biggest bookies have called for the government to consider the proliferation of offshore wagering, prompting criticism from anti-gambling advocates and harm experts.

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The ATO learned it was being scammed, then paid out millions more to fraudsters

By Angus Grigg, Neil Chenoweth and Kyle Taylor

Four Corners

Topic:Scams and Fraud

Mon 28 JulMonday 28 July

The ATO estimates 57,000 people were involved in the scam. (Four Corners: Nick Wiggins)

Link copied

Share article

It was a scam so simple it took just minutes on your phone, where you could tell the tax office how much money to pay you, and it came through within days.

The ATO loophole was so vast that tens of thousands of Australians stole a total of $2 billion.

It was Australia's largest GST fraud. But it did not need to be this way.

New details uncovered by Four Corners show the ATO was warned its systems were badly lacking, but even when it eventually discovered the fraud, it continued to pay out hundreds of millions of dollars.

The ATO maintains it cracked down hard on the scam, moving quickly to shut down the perpetrators and cut off the money.

The case of Linden Phillips would suggest otherwise.

It showcases in granular detail the ATO's failures and how, while some loopholes are closed, others are being exploited on a far larger scale.

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Who were the victims of the crime?

Banks & Financial Institutions

Individuals who had their identities stolen

Automotive companies

What was the impact of the crime in terms of monetary losses?

Defrauded several major banks and financiers of $178 million over seven years. 91 bank accounts were used to move the funds.

NSWCC seized/froze roughly $38 million worth of assets

53 fraudulent loan applications.

What non-monetary losses did you identify?

Reputational harm to financial institutions and industry trust due to the alleged involvement of insiders within banks.

Emotional/psychological impact to individuals whose identities were stolen and used for loan applications.

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Bank insiders involved in alleged $178m Ponzi scheme

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Police swooped on an $18 million Barangaroo penthouse apartment during raids across Sydney which also netted luxury cars, watches and cash.

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How it works

Employers using cash-in-hand work to pay off the books avoiding:

-          Income tax withholding and superannuation contributions

-          Award and penalty rates compliance

-          Workplace protections

Who are the victims of this crime?

1)      Workers – often underpaid – losing tax and super entitlements, award based wages, penalty rates and paid leave. They are unable to access legal recourse if they are unfairly dismissed or injured whilst working. This is a form of wage theft.

2)      Employers and Taxpayers – some businesses lose competitive edge because these people undercut prices and costs. Economy suffers due to less tax being paid and redistributed into the economy.

What was the impact of the crime in terms of monetary losses:

1)      Economy – less tax being paid and into economy, impacts investment and infrastructure. ATO estimates a tax gap from this shadow economy rose from ~3.8% of GDP in 2017 to ~5.3% in 2022, which equates to billions of dollars annually

2)      Unpaid wages and super – some large scale cases are George Calombaris who underpaid ~$7.8 million, University of Melbourne long term wage repayment of ~445 million – illustrate significant losses to workers

What Non monetary losses did you identify:

1)      Loss of legal rights and protections – i.e workers compensation, unfair dismissal, leave entitlements. Proper workplace conditions

2)      Psychological stress and exploitation – fear of reporting, especially among migrant workers

5)      Social inequality – fosters unfairness and reduce trust in labour and tax system

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Calombaris’ $200,000 fine for wages scandal ‘light’, Attorney-General says

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Attorney-General Christian Porter says he is open to calls for “firmer penalties” and criminal charges for bosses who underpay their employees following the former MasterChef judge’s wage theft case.

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Who were the victims of the crime?

The victims are consumers as the assumption would be that these counterfeit goods were actually legitimate, along with legitimate businesses who have lost potential profits as well as brand reputational damage (again) due to these counterfeit items.

What was the impact of the crime in terms of monetary losses?

The group utilised social media sites to sell their goods and had allegedly moved approximately $9.75 million in profits through various bank accounts.

What non-monetary losses did you identify?

Only potential brand damage for the retailors selling the authentic items.

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1. Who are the Victims of Financial Crime

Vulnerable domestic and international students are targeted with false promises and the lure of a job. These students were offered training and assessments to get fake qualification.

2. What was the impact of the crime in terms of monetary losses

All the students who have paid for these fake qualifications loose their money and the qualification they might have received will not be of any value.

3. what non monetary losses did you identify

Stress for victims and their families. Their valuable time is lost until they realise that their qualification is fake.

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When Chay Chan responded to a social media ad promoting training certificates he had no idea he would become embroiled in an unfolding scandal sweeping the $7 billion a year private college sector that involves dodgy operators, bogus qualifications and financial fraud.

Behind the slick websites and promises of a world-class education a shadow industry has thrived - one where colleges and migration and education agents have spent decades exploiting the system. Vulnerable domestic and international students are targeted with false promises and the lure of a job. Some are complicit.

Some of them are criminal networks, others are less sophisticated shonks hoping to make a quick buck, selling fake qualifications from a few hundred dollars to tens of thousands of dollars per student.

Do you know more?

Contact Adele Ferguson usingferguson.adele@abc.net.au

If you require more secure communication, please choose an option on the confidential tips page

Christine Nixon, who authored the Rapid Review into the Exploitation of Australia's Visa System in March 2023, says some colleges are complicit in people coming to Australia illegally.

"I found particular nationalities who exploit their own nationalities," she says.

Nixon made 34 recommendations focusing on strengthening regulations, improving enforcement, and addressing vulnerabilities in the visa system to prevent exploitation, particularly of migrant workers.

Over the past year, the Australian Skills Quality Authority (ASQA) has ramped up enforcement, cancelling the registrations of 51 private colleges in the year to June 2024 - a 34 per cent increase from the previous year. In the six months to December 31, 2024, another 28 were deregistered.

Among them, four colleges were responsible for the cancellation of over 21,000 qualifications in critical sectors like childcare, aged care, and community services.

Notably, three of them were domestic colleges.

Millions wasted on worthless diplomas

For the 18,750 students whose qualifications were revoked, it meant millions of dollars wasted on now-worthless diplomas. Chan is one of them.

Industry insiders say it is just the beginning as the regulator continues to sharpen its focus after receiving increased government funding in 2023 to improve the quality and integrity of Vocational Educational Training (VET), including $33.3 million to establish an integrity unit and a tip-off line.

Since the tip-off line became operational in October 2023, ASQA says it has received more than 3,000 leads, with more than 50 per cent offering detailed information. The integrity unit has undertaken 113 unannounced raids on providers offering training and assessment to overseas students.

Chan wasn't surprised when he learned that Luvium was one of the providers caught up in the mess.

He came across Luvium in October 2023 when he received a diploma that he didn't apply for. He had been dealing with a third-party provider that claimed to work with multiple colleges. He was seeking a Certificate in Training and Assessment to help him get a job teaching English in regional Australia.

"I have previous experience teaching English and computers at community organisations," Chan says. "I see it as a great way to give back and help guide young people and others through lifelong learning."

He believed a formal qualification would help him secure teaching work, so he pursued Recognition of Prior Learning (RPL) - a legitimate process used by TAFEs, private and community training providers to assess existing skills and award qualifications. But the process is easily rorted.

The company Chan was dealing with, Get Certified Australia, assured him they could use the RPL process to qualify him for a Certificate in Training and Assessment. He transferred them $2,000, supplied various documents and references and waited.

Within weeks, he received a Diploma of Community Services issued by Luvium along with a separate record of results, listing subject units he had supposedly enrolled in and passed.

Over a series of WhatsApp messages with a representative of Get Certified Australia, who called himself Ameer, Chan was given a range of excuses and apologies and told: "Listen we already paid $2,000 to college. For diploma of community services."

Chan realised he wasn't going to get a refund or the correct certificate.

In one exchange the representative said: "Any other qualifications do you need." Chan says he didn't take the offer seriously and replied, "PhD," to which the representative responded: "PhD in psychology...I can help to make money online. Do you have soft skills. Future billionaire investor in cryptocurrency."

Communications ceased when Chan posted a message in the WhatsApp thread stating that he had reported the business to the authorities. The phone number was changed, the website noted "maintenance mode is on" and the business address on the invoice Chan received turned out to be an empty office.

Rorting and other red flags

When ASQA cancelled Luvium's registration last October after finding it had issued qualifications without appropriate training or assessment, 7,360 students were given a short window to prove that their qualifications in critical areas including childcare, community services and first aid were legitimate, or they would be cancelled. None were able to demonstrate they had the necessary training or assessment.

Chan wasn't affected because he never used his fake Luvium diploma for work. But thousands of others were and so were the companies they worked for.

Quality College of Australia boss Richard Finlayson says the sector has had problems for decades. He estimates that one-third of private colleges do the right thing in terms of compliance, one-third are in the middle and the rest don't care.

"They are set up with trust funds and the money ends up overseas," Finlayson says.

He says Recognition of Prior Learning (RPL) is a good scheme in principle but in practice it is heavily rorted: "It is being used for quick qualifications."

Finlayson says other red flags are colleges that offer courses much shorter than the standard duration and courses that should be practical but are delivered 100 per cent online.

"In aged care there is a skill shortage, so people are doing short courses online. The problem with that is when you aren't being trained, what do you do if an elderly lady falls and how do you put her back on the bed? You can't learn that online, it needs to be practical," he says. "How can we allow this as a legitimate forum of training?"

There is evidence that some colleges falsely mark students as attending courses when they are not. For international students, this violates their visa conditions, which require a certain number of hours of face-to-face attendance.

One Chinese student was quoted in online publication VOA Chinese last November saying: "In the first half of the year, you need to go to a college... one to two days a week, and you only need to go half a day. Later, if you transfer to a private college, the school can take your attendance, so you don't need to go at all. It's really a gold rush."

In September last year, an online Indian newspaper, The Tribune, published an article about the crackdown, reporting that "Hundreds of students from North India rush to these colleges every year "to take dummy admissions and instead work", while their attendance and course certificates are taken care of".

The scale of misconduct is staggering

ASQA told the ABC that, as of December 31, it was handling 174 serious matters including allegations of cash-for-qualifications schemes, fraud, fake diplomas, and fabricated assessments. These cases involve 138 training providers - and 103 of them cater to international students.

The scale of misconduct is staggering: 68 per cent of these serious matters involve fraud, from visa scams and funding rorts to sham RPL processes that falsely legitimize unearned qualifications. Some providers don't deliver any actual training or assessment, while others run ghost colleges where students pay for a visa rather than an education.

"In addition to the 174 serious matters under investigation, ASQA has 84 compliance activities underway across both VET and CRICOS providers," an ASQA spokesperson said.

There are currently 24 providers before the Administrative Review Tribunal who are appealing registration cancellation decisions. Some of these providers continue to operate while their appeal is heard, but some have conditions on them.

Indian students make up the second-largest group of international students in Australia, but opportunistic agents are scamming students out of hundreds of thousands of dollars.

Some students are complicit. Some - like Chan - are not.

There is a growing perception that Recognition of Prior Learning (RPL) is flawed. There is no independent verification to ensure training providers gather enough evidence to prove that applicants have the necessary skills and experience for their qualifications.

Colleges have been abusing the RPL system for years but the issue gained widespread attention in 2023 when the NSW building commissioner ordered a skills audit on construction sites after discovering some workers were buying qualifications instead of completing proper training, leading to unsafe and substandard work.

ASQA has had it on its radar for years but went public and placed RPLs as a risk priority in 2023-24. Some say it should have done it years ago.

Finlayson and other experts believe there's a solution. "The whole industry changes overnight if a system of external assessors was introduced," Finlayson says. "Currently colleges effectively mark their own homework."

Currently, many registered training organisations train and assess students, creating a conflict of interest where providers are incentivised to pass students, regardless of whether they have the required skills.

A spokesman for ASQA says the regulator doesn't support this characterisation. "The combination of training (or instruction) is intrinsic to Australia's model of education and applies to schools, higher education and VET," he says. But he says when there are "bad faith actors" often both training and assessment will be compromised.

"ASQA recognises this as an issue for high-risk providers and has secured MYEFO funding to develop a model to support the use of external (independent) validation of the assessment undertaken by high-risk providers," he says. "This will be an additional regulatory tool used by ASQA moving forward."

Better checks and balances overseas

Claire Field, a consultant who established Australia's first national VET regulatory agency, says countries with well-established vocational training systems tend to have more checks and balances on assessment decisions than Australia.

She says in Germany, external assessment centres run by employers and unions test students to verify that training providers have delivered proper education. The UK has "awarding bodies" with a similar oversight role, while Singapore uses Skills Assessment Centres to allow employers to have workers' competencies independently evaluated. New Zealand's Qualifications Authority conducts regular assessment moderation to ensure accuracy in training outcomes.

"In Australia too many people have said it's too hard to separate training from assessment and how would we fund it?" Field says. "The reality is that for government funded training, the government funds a training provider to both deliver training and assess students. The same is true when employers or individuals pay for training. It would be easy to split these fees into a portion for the delivery of training and a separate amount for the assessment of students."

Australia already operates independent skills assessment centres, Field adds, but they are primarily used to evaluate migrants' qualifications: "Expanding these centres for local students would strengthen training credibility and prevent the integrity issues plaguing the system."

Life moved on for Chan and he didn't end up teaching English in rural Australia. He is currently working on solar farms. But he worries about the private college sector and how the quality of the industry is being undermined.

"When people are able to take shortcuts to work in elderly care or childcare, they have the potential to do a lot of damage," he says.

"Imagine someone with English as a second language gets a Diploma in Community Welfare and is looking after someone's frail parents or grandparents at an aged care facility, and they make a mistake resulting in the death of the person they were tasked to care for... or a childcare worker."

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Millions wasted: A scandal is erupting inside the private college sector

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Behind the slick websites and promises of a world-class education a shadow industry has thrived - one where colleges and migration and education agents have spent decades exploiting the system.

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1. Who were the victims of the crime?

The Australian public are victims as taxes aren't paid on the products sold which in turn has an effect on the amount of money the government is able to spend on things the entire community benefit from. Other victims in this crime are the genuine tobacconists who lose revenue as consumers purchase these illegitimate products.

2. What was the impact of the crime in terms of monetary losses?

It's estimated that over $2.7 billion of tax was evaded through the illicit trade of tobacco in 2022/2023. The Australian Treasury department is forecasting a $6.9 billion reduction in the federal budget between now & 2029 as the result of the illegal tobacco trade & failure for the government to benefit from the steadily climbing tobacco excise.

3. What non-monetary losses did you identify?

Impact on genuine businesses operators

Impact on people's health with cheaper product flooding the market

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MAST detectives seize 46 million illicit cigarettes; additional charges laid | Australian Federal Police

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Detectives from the Multi-Agency Strike Team (MAST) have laid further importation charges under Strike Force Aulic following the seizure of 46 million illicit cigarettes at the Australian border. ***Images available via Hightail***

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Who are the victims of the crime?

-          Although no direct victims in this case, the crime in and of itself fuels violence in our communities, addiction and organised crime. Friends and family of users are then affected by the suppliers/users of the drugs.

What was the impact of the crime in monetary issues?

-          Although a routine check, resources used during law enforcement operations and later in court. As well as health systems and rehab centres for users. Mules used in instance' can cause severe financial loss for innocent victims involved

What non-monetary losses did you identify?

-          Mental health impacted of family and friends of user/ supplier. Safety of community when violence erupts. Overall health and relationships are strained.

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French man arrested at Sydney Airport over alleged $20 million discovery

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A French national has been arrested and charged with importing a commercial quantity of methamphetamine after allegedly being caught trying to import 22kg worth of the substance into the country.

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Man charged with fraud and identity theft offences

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Man charged with fraud and identity theft offences

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1. Who were the victims of the crime?

The victims included a hospitality business in Belconnen, which was targeted through the theft of an EFTPOS machine. Additionally, 77 individuals were affected after their identity documents were found in the suspect’s possession, indicating widespread identity theft. Financial institutions and merchants were also likely impacted due to unauthorised transactions and fraudulent activities linked to the stolen identities.

2. What was the impact of the crime in terms of monetary losses?

The crime resulted in over $16,000 being stolen through unauthorised refunds processed via the stolen EFTPOS machine. Furthermore, the suspect allegedly attempted to steal an additional $55,000, indicating a significant financial threat. Investigations are ongoing, and further forensic analysis may uncover additional monetary losses tied to the fraudulent activities.

3. What non-monetary losses did you identify?

Non-monetary losses included the compromise of personal data and privacy for 77 individuals whose identity documents were misused. Victims likely experienced emotional and psychological distress, including anxiety and fear, as a result of the identity theft. Additionally, they may face a substantial administrative burden in restoring their identities, securing accounts, and mitigating the long-term effects of the fraud.

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A 34-year-old Gungahlin man will face the ACT Magistrates Court today (Tuesday, 23 January 2024) on more than 130 fraud and theft related charges.

On 12 October 2023, police responded to a report of a stolen EFTPOS machine from a hospitality business in Belconnen.

On 19 October 2023, police executed a search warrant on the man's Gungahlin home and recovered the stolen EFTPOS machine, along with bank cards and other identity documents in the names of other people.

Following a significant investigation, yesterday (Monday, 22 January 2024) police executed another search warrant at the man's home, seizing numerous identity and falsified documents as well as mobile phones.

Police will allege the man stole more than $16,000 via unauthorised refunds using the EFTPOS machine. It will also be alleged he attempted to steal a further $55,000.

During the search warrant, identity documents relating to 77 people were located. Police will speak with those people to determine if further offences have been committed.

He has been charged with:

One count of theft,

19 counts of obtain property by deception,

36 counts of attempting to obtain property by deception,

Two counts of possessing a device for making false documents,

78 counts of possessing false documents,

Two counts of using false documents, and

One count of money laundering.

A forensic examination of the seized items is underway and police have not ruled out further charges.

Anyone who suspects they may be a victim of identity theft should report it to police and seek assistance from IDCARE at https://www.idcare.org/.

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Man charged with fraud and identity theft offences

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A 34-year-old Gungahlin man will face the ACT Magistrates Court today (Tuesday, 23 January 2024) on more than 130 fraud and theft related charges.

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1. Who were the victims of the crime?

The victims would include the general public/tax payers as well as the government but more specifically businesses selling tobacco legitimately as they would lose their profit/revenue to the black economy.

1. What was the impact of the crime in terms of monetary losses?

According to the Australian Taxation Office, $6 billion worth of illicit tobacco was attempted to be smuggled into the Australian market in the 2022-23 financial year. In the 2023-2024 financial year, $58 million worth of illicit cigarettes, amounting to 6.7 million cigarettes, were seized by authorities.

1. What non-monetary losses did you identify?

Illicit cigarettes being sold to the public aids transnational serious organized crime syndicates. This has a greater loss to the general public in terms of the safety and security of the community.

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More than 46 million illicit cigarettes seized in border bust

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Four containers with illicit cigarettes with a total value of approximately $31 million were seized.

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Melbourne identity theft victims speak out after losing $370,000 to fraudsters

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Melbourne identity theft victims speak out after losing $370,000 to fraudsters

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1.Who were the victims of crime?

John and Julie who had all their life savings stolen and shares sold due to a complex identity theft having taken place whilst they were on holidays.

2. What was the impact of the crime in terms of monetary losses?

Life savings depleted from multiple accounts and shares sold totalling $370,000

3. What non-monetary losses did you identify?

The retired couple were victims of a sophisticated identity theft case. The couple suffered major anxiety and stress to this day, not knowing how they became a victim in this case and feeling like they were the criminals when attempting to identify themselves and recoup any stolen funds. The ordeal has taken a huge toll on both of John and Julie's mental health who have not lost trust in the major banks.

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John had embarked on a family trip of a lifetime. By the time he got home, criminals had stolen his identity

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A Melbourne couple had $370,000 stolen from bank accounts in a “horrific” case of identity theft. It has prompted calls for banks to sharpen up against scammers and fraudsters.

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Business owner jailed for ‘phoenixing’ to avoid tax

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Business owner jailed for ‘phoenixing’ to avoid tax

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Who were the victims of the crime?

Illegal phoenix activity directly impacts sub-contractors, creditors and employees as they are left unpaid and out of pocket.

The offender abandoned the company without paying its debts.

What was the impact of the crime in terms of monetary losses?

Over a number of years, the offender had made several significant cash withdrawals totalling A$1.8 million from ATMs, including an A$650,000 cash withdrawal from ATMs at a casino.

He also transferred A$831,000 from business bank accounts into his personal credit card accounts and other non-company bank accounts.

There were non-payment of Goods and Services Tax (GST) and Pay-As-You-Go withholding (PAYGW) due to the ATO.

What non-monetary losses did you identify?

The offender installed family members and associates as directors. He used his relationships to conduct this illegal activity, and these relationships may have suffered from this. As well as his credibility in the welding/construction industry.

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Identity theft: Alleged prolific Auckland fraudster faces dozens of charges

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Identity theft: Alleged prolific Auckland fraudster faces dozens of charges

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1. Who were the victims of the crime?

Several large mainstream electronic and hardware retailers. Items allegedly obtained by the man included high-value electronic and hardware goods.

The people who had their identity stolen with the use of fake drivers licences.

2. What was the impact of the crime in terms of monetary losses?

More than $110,000 in products including fraudulently ordering nearly $20,000 in equipment commonly used to operate a clandestine laboratory.

3. What non-monetary losses did you identify?

Stress and concern for the unsuspecting victims of the identity theft (there were 12 separate cases Auckland-wide).

Fear for retailers that they are not dealing with who they think they are dealing with. This may have negative impacts on genuine customers.

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NZ Herald9 Apr, 2025 04:09 AM2 mins to read

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$110k fraud scheme: Man allegedly used fake ID for electronics, hardware spree

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Police have laid 36 charges and a man has appeared in court.

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A decade of debt and corporate incarnation 

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A decade of debt and corporate incarnation 

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The victim of the crime

Home-owners who received faulty apartments or had paid a deposit but never gained possession of their home.

The creditors and the contractors who never got paid for their labour and hard work.

Monetary impact of the crime

Creditors and sub-contractors lost their money amounting to tens of thousands of dollars.

Non-monetary impact of the crime

Emotional distress - People who had put their life savings into purchasing a house, and not having received a possession underwent immense stress.

Legal challenges - The subcontractors who had to fight for their due payments for their hard work had to go through gruesome and tiring lengthy legal processes.

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The family empire behind a succession of company collapses, defective buildings and unpaid tradies

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For years, Dyldam’s string of company collapses has anguished apartment buyers, angered subcontractors, and frustrated liquidators.

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Who were the victims of the crime?

Customers of financial institutions, including a man and a woman, who had her identity credentials stolen by scammers impersonating bank employees

Unsuspecting individuals are all potentially at risk of falling victim to such sophisticated scams

What was the impact of the crime in terms of monetary losses?

$47,000 to one victim

Almost $50,000 to another victim

In 2024, AFCA made a landmark decision, in favour of compensating victims in sophisticated impersonation scams

What non-monetary losses did you identify?

Stress for the victims

Reputational damage to the financial institution

Remediation/reimbursement processes for the financial institution

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Banking giant HSBC may have to compensate customers robbed by scammers after a consumer watchdog found a victim should not have been held responsible for their $47,000 loss.

In a landmark ruling, the Australian Financial Complaints Authority rejected HSBC's claim it was not liable when a sophisticated scammer masqueraded as a bank worker to raid the victim's account, an argument it has used to deny compensation to other victims.

Sydney woman Sunni Wan is one of the victims still battling HSBC for compensation. Credit: Nikki Short

The authority also criticised HSBC's customer service and its adversarial approach to the case.

The " lead decision" involving one of the cases is considered a change of approach for the financial services complaints body, in favour of victims, and came after an investigation by this masthead uncovered major failures in HSBC's response to the signature scam.

Over at least 10 months in 2023 and 2024, fraudsters were able to infiltrate genuine text message chains from HSBC to make victims believe their accounts had been compromised and scare them into handing over passcodes to a fake bank worker.

Even when customers realised they were being scammed as they were still speaking with the scammer, HSBC was unable to retrieve their money because criminals quickly changed the victim's daily transfer limits and moved money into new accounts and cryptocurrency.

This masthead revealed that in some cases, consecutive logins were being made on HSBC accounts from different countries, making it impossible that they could have been made by the same person.

In the case considered in detail by the Australian Financial Complaints Authority, a man identified only as "Mr T" received a text message in June last year that appeared in a thread of legitimate text messages previously sent by HSBC.

It warned him that a $740 transaction was being attempted by Amazon, and instructed him to call a 1300 number if he did not authorise it.

When the man called the 1300 number, he was greeted by an interactive voice response recording identical to that used by the bank, and the scammer knew his personal details, such as his bank username.

The crook then asked him to verify his identity by disclosing two banking passcodes, which were used to steal just over $47,178 from his account.

HSBC had argued that in the case of Mr T, and many other cases examined by this masthead, the victim was ineligible for any reimbursement of the stolen funds because they had breached a clause of the ePayments code which says users must not "voluntarily disclose one or more passcodes to anyone".

But this argument was rejected by the Australian Financial Complaints Authority, which found the scammer's manipulative tactics meant the victim felt compelled to disclose the passcodes, and therefore was not voluntary.

"The panel is satisfied the scammer created a sense the complainant needed to act urgently to prevent the loss of his funds, and the overall impression he was dealing with the bank, and it would therefore not be fair in all the circumstances to find the disclosure of the passcodes was voluntary," the decision said.

The finding is significant because, as a lead decision, it decides on core issues and principles that can be applied to a batch of similar cases, although each would still be decided on its individual merits.

"If another case were to resolve around very similar facts, a similar decision would be likely," explained the authority's lead ombudsman for transactions, Suanne Russell.

"In this particular lead decision, regarding an HSBC impersonation scam case, the focus was on the disclosure of passwords that were necessary to carry out the transaction and whether this was voluntary."

HSBC was instructed to pay the complainant $47,028, plus $5000 in legal costs and $1000 for compensation for its failure to meet the Banking Code of Practice around customer service.

Stephanie Tonkin, chief executive of the Consumer Action Law Centre, said the authority's determination was surprising for several reasons, including because the panel described the bank's conduct as "adversarial".

"This isn't the first time a bank has been aggressive at AFCA. We've seen plenty of times, but for it to be publicly called out like that, in a determination, that is significant," she said.

The Australian Financial Complaints Authority has received 329 complaints related to the HSBC impersonation scam, of which 121 are still open.

"As always, we encourage all financial firms to think about whether they should be resolving consumer complaints without the need for intervention by AFCA," Russell said.

HSBC was asked if it would review its liability findings for customers impacted by the scam in light of the authority's finding, but a spokesperson did not answer the question.

Instead, they said the bank acknowledged the decision, which they described as related to a "historic and specific type of bank impersonation scam".

"The outcome has been accepted by the customer and is now resolved," they said.

"Falling victim to a fraud is a distressing situation. We remain committed to working with industry and government to disrupt scams and protect customers, and will continue to work hard to support victims of scams."

Sunni Wan, who leads a support group of about 70 of the scam's victims, is one of the people whose case is still before the authority.

She had almost $50,000 stolen from her in December, after receiving a message that appeared to come from the bank. Wan had been saving the money as a buffer for interest rate rises and to fund her mother's knee operation.

Despite hanging up on the scammer mid-call and immediately contacting HSBC, the bank wasn't able to retrieve Wan's money. Instead, the bank's fraud team found her liable for the losses because she "voluntarily" disclosed bank passcodes.

The Sydney woman said that following the lead decision, about half-a-dozen people had been offered reimbursement from the bank. But the majority of the people in the support group had not yet received an offer.

"They're [HSBC] being dragged kicking and screaming to this," Wan said. "It's pretty poor."
Start the day with a summary of the day's most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.

Connect via Aisha Dow is an investigative journalist with The Age. A Walkley award winner, she previously worked as health editor and co-authored a book about the COVID-19 pandemic in Australia. Twitter or email.

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Banking giant loses battle against scam victim

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The decision by the Australian Financial Complaints Authority, which came after an investigation by this masthead, has come as a welcome shock to victims and consumer advocates.

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Auckland businessman found guilty of money laundering in connection with $2m investment scam

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Auckland businessman found guilty of money laundering in connection with $2m investment scam

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1. Who were the victims

of the crime?

Northland retiree Steven Fan and now deceased pensioner Anthony Lipanovic - had been searching online for investment opportunities in December 2022. They stumbled across a website for Magnitude Financial where they registered their details.

Beca - cause the business undue hardship by identifying that Carel Johannes Viljoen is connected with money laundering proceeds.

The businessman himself Carel Johannes Viljoen - he trusted his brother and assumed the scheme was above board, he acted, with the benefit of hindsight.

2. What was the impact of the crime in terms of monetary losses?

Nearly $2 million - Fan transferred just shy of $1m on January 13, 2023. Lipanovic transferred $950,000 on January 21.

3. What non-monetary losses did you identify?

Beca - Reputation and loss of employee

Carel Johannes Viljoen - Lost his job, normal life, reputation and relationship with his brother.

The victims - impact on their mental health and trust for investment and banks

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Melbourne identity theft victims speak out after losing $370,000 to fraudsters

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Melbourne identity theft victims speak out after losing $370,000 to fraudsters

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The victims of the crime:

John, Julie, their friends, family and work clients.

The impact of the crime in terms of monetary loss:

$370,000

Non-monetary impact of the crime:

A huge impact on Julie and John's mental health, including increased anxiety, stress, loss of trust in their professional relationships, and potential emotional strain on their family members.

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John had embarked on a family trip of a lifetime. By the time he got home, criminals had stolen his identity

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A Melbourne couple had $370,000 stolen from bank accounts in a “horrific” case of identity theft. It has prompted calls for banks to sharpen up against scammers and fraudsters.

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Who were the victims of the crime?

The main victim of the crime was Oranga Tamariki (NZ government agency). Waka Kotahi (NZ transport agency) was also a victim as they were indirectly affected when Neha Sharma used forged references to gain employment there.

What was the impact of the crime in terms of monetary losses?

More than $2 million fraudulently obtained from Oranga Tamaraki through Neha's husband's company - Divine Connection, which was set up without disclosing conflict of interest. Additionally, just under $800,000 was laundered and transferred to bank accounts overseas (primarily in India), resulting in a significant financial impact.

What non-monetary losses did you identify?

The non-monetary losses include damage to public trust in government agencies and the confidence in the integrity of public institutions. This kind of abuse in power, especially when public funds are involved, can result in the loss of faith in how government agencies operate. The article has also highlighted failures in the review and hiring process, as there was an oversight when Neha applied at these agencies.

https://www.sfo.govt.nz/media-cases/media-releases/sfo-files-charges-against-former-oranga-tamariki-employee-over-2-million-fraud

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Husband and wife admit $2 million fraud against Oranga Tamariki in SFO case

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A former public sector employee and her husband have admitted to working together to fraudulently obtain $2 million from Oranga Tamariki, following a Serious Fraud Office (SFO) investigation.

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Strike Force Aulic - 46 million illicit cigarettes seized MAST detectives seize 46 million illicit cigarettes; additional charges laid

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Strike Force Aulic - 46 million illicit cigarettes seized MAST detectives seize 46 million illicit cigarettes; additional charges laid

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1. Who were the victims of the financial crime?

The goal of the importation & transportation of the illicit cigarettes was to avoid taxation on importation & sale. As such the ultimate victims are the Australian public due to the lost taxation revenue which is used to fund public services – hospitals, schools, roads, etc.

2. What was the impact of the crime in terms of monetary losses?

46 million illicit cigarettes. Taxation on cigarettes from March 2025 = $1.40312 per stick  $64.5m in lost taxation revenue.

ABC article from March 2025 suggest annual federal budget is lower by $6.9b due to illicit cigarette market. A booming trade in illegal cigarettes has cost the federal budget $6.9 billion - ABC News

3. What non-monetary losses are there?

Depending on where the illicit cigarettes end up there could be significant societal losses – e.g. children gaining access to cigarettes before the legal age, on-selling of illegal cigarettes to vulnerable communities sparking addiction and a perpetual cycle of harm.

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Crypto ATMs increasingly used for scams and money laundering - ABC News

Who were the victims of the crime?

Australians are victims of the scams using these Crypto ATMs, with majority being females over 50 years of age. The most reported scams reported are investments scams, followed by Extortion emails and romance scams.

What was the impact of the crime in terms of Monetary Losses?

Australians reported loss through Crypto Currency ATMS was at least $3 million in the last 12 months however the losses are expected to be a lot higher as most victims don’t report the matters.

It was reported in the article, one male victim alone deposited $1.4 Million through crypto ATMS with all funds being unrecoverable. Once the funds are deposited into the ATM they are converted to digital currencies which it is near impossible to recoup these funds.

What Non Monetary Loses did you identify?

With the increased Crypto Currency ATMS across Australia is it not only the concern of increased scam victims, it is also the heightened risk of drug purchases & other money laundering activities with AUSTRAC suspecting one in 10 transactions may be linked to illegal activity using these ATMS.

Not only are the victims at loss of funds that are deposited into these ATMs, they have more than likely provided personal details including their identification which can also result in ID theft or mule accounts being created in the victims details.

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Entain Group Pty Ltd accused of allowing criminals to money launder

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Entain Group Pty Ltd accused of allowing criminals to money launder

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Who were the victims of the crime?

All Australians that participate in the Australian Financial system as Money Laundering activities undermines the trust the integrity and trust in Financial system.

Communities that deal with the negative repercussions of the crimes that occurred for the laundered proceeds.

What was the impact of the crime in terms of monetary losses?

The exact dollar amount is not specified but each contravention attracts a maximum penalty between $21 million and $33 million.

Taxpayers who will bare the increased cost of welfare services due to the negative impacts of crime committed for the "dirty money" such as drugs.

What non-monetary losses did you identify?

Undermines the integrity and trust in the Australian Financial system

Incentivises further criminal activity as significant compliance gaps and lack of controls like this example still exists in the financial system which can be exploited.

Reputation damages to the Entain group which is behind two of the largest bookmakers, Ladbrokes and Ned and the gambling industry as a whole.

Weakened public trust in corporations upholding compliance and AML efforts.

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Austrac accuses Entain of allowing suspected criminals to launder cash

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The British bookmaker behind Ladbrokes and Neds allegedly allowed more than a dozen high-risk customers to funnel money through its accounts despite the risks.

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1. Who are the victims of the crime?

The victims come from many walks of life. Rich or poor are influenced and initiated into using drugs, which in turn creates adverse effects on the health and well-being of not just the user but the entire family and in turn communities. Drug mules may or may not be aware of what they are carrying.

2. What was the impact of the crime in turns of monetary losses?

According to data from the UNODC/WHO/UNAIDS/World Bank published in 2023, approximately 20,000 people in Central America and about 100,000 people in the Caribbean engage in injecting drugs, underscoring significant regional challenges. (Source: INCB Annual Report 2023)

Furthermore, new global estimates indicate that in 2021, there were 13.2 million people globally who inject drugs, marking an 18% increase from previous estimates. The overall number of drug users worldwide in 2021 exceeded 296 million, reflecting a notable 23% rise over the past decade. Concurrently, the number of individuals grappling with drug use disorders surged to 39.5 million, a substantial 45% increase over the same period. (Source: UNODC Press Release)

In response to these escalating challenges, the United Nations Office on Drugs and Crime (UNODC) allocated USD 83.6 million in 2023 towards addressing and combatting the global drug problem. (Source: UNODC Annual Report 2023)

Moreover, the Drugs-Crime Nexus in the Amazon Basin, as highlighted in the World Drug Report 2023, emphasizes the severe impact of drug trafficking on countries such as Brazil, Peru, Bolivia, and Colombia, which host significant portions of the Amazon rainforest. (Source: UNODC World Drug Report 2023)

On a global scale, cannabis remains the most widely used drug, with an estimated 219 million users in 2021, comprising 4.3% of the global adult population. (Source: UNODC World Drug Report 2023 Executive Summary)

These statistics underscore the urgent need for concerted international efforts to address the complex challenges posed by drug trafficking and drug abuse worldwide.

3. What monetary losses did you identify?

Social harm - destroying the lives of the users, drug mules (living in fear or threat and extortion) and finally destroying the lives of loved ones.

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ZIGRAM - The Best Risk Apps For AML & Financial Crime Compliance

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How Is Drug Trafficking Related To Money Laundering? | ZIGRAM | The Best Risk Apps For AML & Financial Crime Compliance

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Drug trafficking and money laundering are major global problems that cause significant economic and social harm around the world. These two illegal activities are closely connected: the money made from selling drugs needs to be cleaned or laundered so it can be hidden and used in legal financial systems.

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Who were the victims of the crime?

. The community and tax payers who bear the cost to society.

. Social services

. Public health services which need to accommodate to smoking related illnesses and therefore those who have unrelated health issues who are impacted due to the resources allocated to tobacco.

What was the impact of the crime in terms of monetary loss?

The federal budget bottom line has been dealt an almost $7 billion blow in tobacco tax revenue, as black market cigarettes sales boom.

Australians turning to cheaper illegal tobacco or switching to vapes has seen the expected tobacco tax take plummet, with Treasury forecasting $6.9 billion will be slashed between now and 2029.

What non-monetary loss did you identify?

. Social impacts, such as health.

. Increase in gang related crimes.

. Devaluation of property due to increase crime in certain areas.

. Higher wait times to see doctors

. Impact on legitimate businesses.

A booming trade in illegal cigarettes has cost the federal budget $6.9 billion - ABC News

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The federal budget bottom line has been dealt an almost $7 billion blow in tobacco tax revenue, as black market cigarettes sales boom.

Australians turning to cheaper illegal tobacco or switching to vapes has seen the expected tobacco tax take plummet, with Treasury forecasting $6.9 billion will be slashed between now and 2029.

Meanwhile, the federal government has pledged to bolster efforts to clamp down on the rapidly growing trade in a bid to stop the problem worsening further.

Sales of illegal cigarettes imported from overseas have boomed in recent years, at the same as black market vapes flooded into Australia.

Budget 2025 Live: Follow our live coverage as Peter Dutton presents his response in our live blog.

Every purchase of legal cigarettes comes with a hefty excise worth about $35 on a pack of 25.

The excise - which has been steadily climbing - has seen cigarette taxes become a lucrative source of revenue for the federal government, pouring billions into its coffers each year.

But the increasing tax burden has also made the significantly cheaper illegal cigarettes a more attractive option.

That's because they don't carry the tax cost and with every packet sold the government misses out on that revenue.

"There is a big hit to tobacco excise, and there is no use pretending otherwise," Treasurer Jim Chalmers said.

"There are two reasons that tobacco excise comes off. One of them is a really good reason and one is a really bad reason.

"More people giving up is a good thing. More people avoiding it is a bad thing, and that's why we're investing in compliance and enforcement to try and turn that around."

A rapid decline in tobacco take

Treasury officials have been forced to quickly revise down their forecasts for tobacco taxes by enormous amounts.

Last year's budget forecast the government would collect $11.5 billion in revenue from tobacco just in the 2025-26 financial year.

Less than a year later, that figure has been dialled down to just over $7 billion - a difference of $4.5 billion, reflecting a massive decrease in sales of legal cigarettes.

The change has been attributed to illegal tobacco, rather than a decline in smoking rates.

This isn't the first time the government has acknowledged tobacco revenue is rapidly declining.

Last year's budget wiped $12.5 billion off the forecast over five years and the mid-year update knocked another $10.7 billion off the four-year forecast.

New funding for tobacco enforcement

The budget includes hundreds of millions of dollars in new funding aimed at trying to stem the volume of illegal cigarettes entering the country.

Police and customs efforts will be bolstered by $157 million to be spent over the next two years, and almost $50 million will go to the Australian Federal Police to target organised crime groups dealing in illegal tobacco and vapes.

Another $40 million will go to state and territory governments to help their efforts and $7 million has been earmarked to find new ways to spot illegal tobacco at the border.

Analysis from the ABC's experts:

Mr Chalmers said that without those efforts the hit to the budget would be even greater.

"We're certainly providing the resources that we can to try and turn this around," he said.

"We're obviously aware that there is an issue here. It's a big hit in the budget. But it would be worse than what we are budgeting for, were we not investing further resources in enforcing the law."

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Booming trade in illegal cigarettes costing the budget billions

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The tobacco excise has seen cigarettes taxes become a lucrative source of revenue for the federal government, pouring billions into its coffers each year.

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Money Laundering

Who were the victims of this crime?

There are many different facets of victims in money laundering, from people who have been exploited, to people who have been scammed, cybercrime also creates another face of victim which affects individuals or businesses. Any individual or any business could potentially be a victim of money laundering.

What was the impact of the crime in terms of monetary losses?

Based just on domestic counters the cost of financial crime is estimated to be as high as $43.7 billion per year. If we include the cost of prevention and response costs it could be as high as $60.1 billion (Figured based on 2020-2021)

What non-monetary losses did you identify?

·         Financing and facilitating crime- Enables criminals to fund other activities such as weapons trafficking of people trafficking, both of which increase potential harm to people.

·         Loss of public revenue- This affects the government by limiting available funds to provide necessary healthcare, education and infrastructure.

·         Reputation of the financial sector- If a financial institution is linked with money laundering the reputational damage the company faces can have significant impact.

https://www.austrac.gov.au/sites/default/files/2024-07/2024%20AUSTRAC%20Money%20Laundering%20NRA.pdf

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Who were the victims of the crime?

- The community itself, family and friends of those that purchase and use drugs, victims of any other crimes associated with other activities of the criminal group that were made possible by having access to to the laundered funds.

What was the impact of the crime in terms of monetary losses?

On one side, the time and money spent on the investigation an subsequent court cases

The ML individual forfeited cars/cash/bank funds

Economic impact of those funds entering the NZ economy

What non-monetary losses did you identify?

Societal impacts of drug use especially on families

Loss of trust in formal banking systems

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‘Dirty money’: $200k in flash cars, cash & drugs seized from Akl drug ring money launderer

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Police found 44kg of meth during Operation Worthington, half of it hidden in a bathtub.

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Southeast Asia Casino & Underground Banking Report

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Southeast Asia Casino & Underground Banking Report

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Report focusses on Southeast Asia illicit banking system. Online gambling platforms operating illegally have emerged as most popular vehicles for crypto currency-based money launderers. As law enforcement has cracked down on casinos within Southeast Asia, there has been a shift to online gambling providers in different regions where the regulations are not as tight including Cambodia, Laos, Philippines & Myanmar. There has also been a shift to areas outside Asia including UAE, Eastern Europe, Africa & the Pacific.

https://www.unodc.org/roseap/uploads/documents/Publications/2024/Casino_Underground_Banking_Report_2024.pdf

1. Who were the victims of the crime?

Southeast Asian governments and Chinese government via tax losses, government spending losses when money is funnelled out of the country.

Banking systems in respective countries as the scale of money laundering via the illegitimate system undermines stability of legitimate system.

Hundreds and thousands of youth unemployed individuals who end up as victims of human trafficking and cyberfraud, forced labour victims. Alongside several cyberfraud victims whose personal data has been sold to invest in these online fraudulent investment platforms.

In May 2023 in the Philippines, the police rescued 1,900 victims of cyber fraud & cryptocurrency investment fraud. In June a second rescue operation saved a further 2,800 victims from forced labour.

2. What was the impact of the crime in terms of monetary losses?

The significant casino industry in Southeast Asia combined with connected junkets (organised gambling group of high wealth players connected to travel through several casinos to attend VIP games), online casinos, e-junkets and illegal unregulated cryptocurrency exchanges are massive banking architectural foundation pieces for organised crime to launder illicit funds through the financial system. This results in billions of dollars of criminal proceeds being effectively integrated into the formal financial system.

As law enforcement has cracked down against casinos this has moved operations to other pockets of criminality with more loose regulations in the Golden Triangle.

In 2020 the Government of China estimated 5 million people used running point platforms and syndicates (underground banking) to total US $157 billion in capital outflows of China.

3. What non-monetary losses did you identify?

Movement into cyberfraud leads to victims of human trafficking. Risks for recruitment fraud, especially for young people. Money mules are also utilised has an impact on their lives and those around them. Financial crime is a direct result of the monetary value gained via criminal activity, as such the victims of the crimes in which the money was derived.

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Police seize Ferrari, luxury vehicles in $5.5 million fraud investigation

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Police seize Ferrari, luxury vehicles in $5.5 million fraud investigation

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Who are the victims of crime?

The victims are two companies that were allegedly defrauded of more than $5.5 million via a cryptocurrency scam.

What was the impact of the crime in terms of monetary loss?

The direct monetary loss is over $5.5 million defrauded from the companies.

Police also seized assets (luxury and classic cars, motorcycles, watches) valued at about $2.7 million, plus a Ferrari worth $600,000, which are proceeds of the crime.

What non-monetary loss can you identify?

Reputational damage to the companies involved.

Emotional distress and loss of trust for company staff and stakeholders.

Disruption to business operations due to the investigation and loss of funds.

Potential loss of confidence in cryptocurrency transactions for the wider business community.

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1. Who were the victims of this crime?

Although no direct victims necessarily, the offender used his own brother's identity. It is unclear whether this identity theft occurred with his knowledge or not. If it was without knowledge, this offending would have implications for the brother for future immigration related matter for him.

2. What was the impact of the crime in terms of monetary loss?

The investigation into this offending took 6-years and the offending involved 14 immigration applications for visas and residency. The monetary value involved in multiple staff investigating this over 6 years would have been extensive. No direct cost to the tax-payer was listed but it would have been thousands of hours of work.

3. What non-monetary loses did you identify?

Such identity theft has huge implications for the integrity of immigration process in New Zealand, and elsewhere. Having people in the country who do not meet our requirements and standards is a risk in itself.

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Couple convicted of 20-year identity and immigration fraud

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Jahangir Alam used his brother’s identity to obtain a visitor visa and enter New Zealand - and eventually gain New Zealand citizenship.

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More than a tonne of cocaine seized by police after vessel intercepted 9nm off Nambucca Heads

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More than a tonne of cocaine seized by police after vessel intercepted 9nm off Nambucca Heads

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1. Who were the victims

of the crime?

Who isn't a victim of drugs? Drugs do not just affect the users, but the wider community also.

Drugs create a multitude of mental and physical health issues for the users which results in increased healthcare burdens putting a strain on our healthcare system and emergency services. There is also increased risk for our frontline healthcare workers who have to deal with increased violence and risks with treating drug users.

There are the social impacts on the wider community with crime and violence, family breakdowns, domestic violence, child abuse and homelessness.

Economically, governments spend more money on healthcare, rehabilitation and law enforcement in areas with high drug activity. Increased spending in those areas leads to reduced spending in other areas that the community may need. There is also an impact on the housing market, with house prices dropping, and landlords losing money due to tennants destroying their houses.

The overall wellbeing of the community is also impacted due to stigma, discrimination and vulnerability of youth being affected.

2. What was the impact of the crime in terms of monetary losses?

The street value of the cocaine was worth $623.4 million and would have been a major hit to the criminal organisation. The resources put into law enforcement to investigate and catch these criminals would of also had significant costs.

3. What

non-monetary losses did you identify?

Each of the people who were arrested, are human beings with families. There will be a major impact on their families with them being incarcerated. They will also face the possibility of abuse and violence in the jail system and may possibly have long lasting mental health issues as a result. When these people are released they will likely struggle to open bank accounts due to adverse media, they will likely struggle to find work due to their criminal record, and they may face discrimination and isolation with their community and own family. The general recidivism rate in Australia is around 45-50% which means that there is a great chance that these people will reoffend when they are released from jail, and be caught in an unfortunate cycle.

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More than a tonne of cocaine seized by police after vessel intercepted 9nm off Nambucca Heads | Australian Federal Police

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Organised Crime Squad detectives have charged five people following the seizure of more than a tonne of cocaine allegedly located on board a vessel off the New South Wales coast.

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Who were the victims of the crime?

When Intellicomms sold its business assets to Tecnologie Fluenti Pty Ltd (which was set up fpr phoenixing to occur), it was then not in a position to satisfy creditors that were owed money.

What was the impact?

The sale of assets basically served to strip Intellicomms of what assets it had to satisfy the claims of its creditors – placing them completely beyond their reach.

What non-money losses did you identify?

Lack of trust between businesses when doing business to business transactions especially of high dollar value

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A “blatant example of phoenixing” – anti-phoenixing laws to the rescue

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In what is a precedent for “Phoenixing” voidable transactions, the Supreme Court of Victoria recently held that a sale agreement of business assets immediately prior to a winding up of a company was a creditor-defeating disposition within the meaning of s 588FDB of the Corporations Act 2001 Cth (Act) and a “Phoenixing” voidable transaction within the meaning of s 588FE(6B) of the Act: Re Intellicomms Pty Ltd (in liq) [2022] VSC 228 .

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1. Who were the Victims of the Crime?

Multiple people invested their savings into Cathy Hua's company believing it to be legitimate. Their money cannot be differentiated from the illegal funds and is still held up under investigation.

2. What was the impact of the crime in terms of monetary losses?

loss of savings for victims

3. What non-monetary losses did you identify?

societal harm due to the drugs it was enabling to enter the system.

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In an unusual twist of events, New Zealand police received an audacious email from Cathay Hua, a notorious money launderer, that taunted their efforts to clamp down on her illegal operations. Hua, a Newmarket businesswoman who ran a foreign exchange business as a front for laundering money, boldly claimed it wasn't her job to help the police fight crime. Instead, she suggested that if criminals were laundering money through her business, it was the police's failure to stop them in the first place.

Detective Inspector Lloyd Schmid, New Zealand's most experienced financial crime expert, found the email both shocking and provocative. Schmid, known for his stern demeanor reminiscent of a strict school principal, was taken aback by Hua's brazen attitude. He recalled reading the email for the first time with disbelief, thinking, "I suspect she's going to regret sending that."

The Fall of Cathay Hua

Despite her defiant stance, Hua's illegal activities eventually caught up with her. In 2023, she received a record seven-and-a-half-year prison sentence, the longest ever handed down for money laundering offenses in New Zealand. Hua's operation was primarily linked to a notorious methamphetamine importer, for whom she laundered $27.5 million.

New Zealand's Money Laundering Battle

The case of Cathay Hua is a vivid illustration of the ongoing battle against money laundering in New Zealand. The country's lucrative drug market, with Kiwis paying some of the highest retail prices for drugs, generates an estimated $1.35 billion a year in illicit cash. Consequently, major drug investigations are not only focused on the narcotics themselves but also on tracing the money and identifying the professionals who facilitate these financial crimes.

Targeting Professional Facilitators

Detective Superintendent Greg Williams, in charge of National Organized Crime, emphasizes the importance of targeting these professional facilitators. Williams, an expert in transnational organized crime, highlights how the landscape of money laundering has evolved. Whereas police once worried about lawyers and accountants, the focus has now shifted to unregulated remitters within the Chinese community who play a significant role in moving money for criminal enterprises.

Williams recounts a notable operation in 2018, codenamed Heracles, where police intercepted a 46-kg cocaine import at the Port of Tauranga. This operation exposed the complex global networks engaged in both drug trafficking and money laundering. A Serbian operative handled the logistics, while a Croatian associate managed the money laundering. Even a Vietnamese woman flew into New Zealand specifically to deposit large sums of cash into local banks.

Legislative Changes and Continued Efforts

The police have made significant strides in addressing these issues, including legislative changes under the Anti-Money Laundering and Countering Financing of Terrorism Act. A key provision now prohibits the purchase of high-value goods with cash above $10,000, aiming to curtail the flow of dirty money into the financial system.

However, the fight is far from over. Investigators like Schmid face high thresholds for proving money laundering, often needing to establish a direct link between the laundered money and specific criminal offenses, such as drug trafficking. Despite these challenges, Schmid remains committed to pushing for harsher sentencing tariffs for money laundering to reflect the gravity of the crime.

The Dramatic Raid

The culmination of these efforts was dramatically illustrated during a police raid on Hua's St Heliers residence. Officers discovered a hidden room concealed behind an open wardrobe, containing a safe filled with fine jewelry. However, piles of cash were found scattered throughout the house, symbolizing Hua's overconfidence and eventual downfall.

The tale of Cathay Hua serves as both a cautionary story and a testament to the relentless efforts of New Zealand's law enforcement to combat financial crimes. It highlights the complex and often international nature of money laundering, the evolving tactics of criminals, and the importance of robust legal frameworks and collaborative efforts to keep illicit money out of the financial system. As Detective Inspector Schmid and his colleagues continue their work, they remind us that while the fight against money laundering is arduous, it is essential for maintaining the integrity of New Zealand's financial and legal systems.

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Catch Me If You Can: The Tale of Cathay Hua and New Zealand's Money Laundering Struggle - Regtechtimes

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In an unusual twist of events, New Zealand police received an audacious email from Cathay Hua, a notorious money launderer, that taunted their...

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Selling ID to Australian Gambling Syndicate

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Selling ID to Australian Gambling Syndicate

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Who were the victims of the crime? Jackson and other victims who had to resort to selling their identity to cover debts or meet financial needs.

What was the impact of the crime in terms of financial losses? Resources used by the AFP and banks to investigate, costs to regain his identity documents, high interest rates for victims if they ever need to take loans for any purpose

What non-monetary losses did you identify? Loss of identity information. Victims fear the syndicate will pursue them as they have their address and personal information. Ethical and moral dilemma as the arrangement feeds into the gambling and betting organisations. Inability to obtain loans because there might have been bad debts accrued when their identity was being used to create numerous accounts.

Jackson sold his ID to an Australian gambling syndicate. He is now discovering what has been done in his name | Gambling | The Guardian

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Jackson sold his ID to an Australian gambling syndicate. He is now discovering what has been done in his name

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Exclusive: By buying identity documents, gamblers banned by bookmakers can create multiple bank and betting accounts in someone else’s name

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Who were the victims of the crime?

The victims are consumers as illicit products can present significant health risks, legitimate businesses as it means unfair competition given the large discounts often applied on these illicit products and the government as it represents massive fiscal losses.

What was the impact of the crime in terms of monetary losses?

As stated in the article imported shipping containers being declared as beer when they were predominantly filled with spirits is denying New Zealand of about $40 million in excise duty annually. This lack of revenue from taxes causes a negative impact on the country’s economy.

What non-monetary losses did you identify?

Significant health risks for consumers who purchase these products given that these products don't go through the due diligence around verification and point of origin so consumers do not know what fluid is in the bottle. Which could lead to alcohol related harm. Unfair competition for legitimate businesses as they cannot compete with products that have been smuggled in due to them been sold at discounted rates. As stated in the article businesses who legitimately import product, spend quite a bit of money ensuring the labelling information is up to spec and complies with New Zealand law.

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4-minute read

Let's discuss the volume of alcohol being illegally imported into the country and imported without compliant labelling. What are the telltale signs of illegitimate product?

Citing examples of imported shipping containers being declared as beer when they were predominantly filled with spirits. That kind of smuggling is denying the country of about $40 million in excise duty annually.

NZ Customs and Spirits NZ are working on ways to stop it. How will you be affected?

"Spirits are particularly relevant in this context because of the level of excise - per litre of alcohol content the charge on spirits is $52, whereas beer and wine is $28/$29," he told the Shipping Gazette™.

"There are two aspects to it. Firstly, it is that product is being brought into the country and skipping the taxes that everyone else has to pay.

Secondly, and this is a global concern in the spirits industry, is that if you are bringing the product in and not going through the due process regarding verification and point of origin etc., then you can't guarantee what fluid is in the bottle."

Although praising New Zealand Customs Service for doing a "great job" in tackling alcohol smugglers, Mr Brewer nonetheless said there is "definitely some smuggling going on".

"The first step is to get an understanding of how widespread it is. My members have anecdotal evidence that it is underway, but we don't have any hard evidence."

Mr Brewer said one of the pointers to there being a potential increase in alcohol smuggling is the notable volume of alcohol being legitimately parallel imported.

"From a global perspective, what tends to happen is that when the legitimate parallel product level goes up, the amount of your illegal product goes up."

How to Resolve The Issue

To help inform the direction of its project, Mr Brewer said he had met with Customs to establish what information the agency required to facilitate best taking action against alcohol smugglers.

"We're going to do a lot of information gathering, to provide Customs with a greater level of intelligence on this matter.

"The first thing we are going to be doing is examining those pricing schedules that my members have access to - a forensic examination of those to see if there are lines of product that stick out as not being correctly priced.

"As 75% of the retail price on average for spirits is excise duty and GST, there is not a lot of wriggle room to discount. So, if things are going to market at a large discount then they are either loss leading or something else is going on.

"Labelling is also really important to us. Every bottle of spirits, beer, wine imported into New Zealand must be labelled correctly - the label has to be in English, declare how many standard drinks are in the bottle, has to have a lot of code, have the name and address of the importer.

"My members, who legitimately import product, spend quite a bit of money ensuring the labelling information is up to spec and complies with New Zealand law.

It is all about these indications about what is a legitimate product and what isn't."

Mr Brewer said he believed that in many instances, purchasers might genuinely not be aware they were acquiring the illegitimate product.

"That is part of the project as well - to make people aware of what are the signs to look for regarding illegitimate product.

"We're going to put together a Website and publicise this through the retail and trade magazines and to licence holders, outlining what are the requirements under the Food Act for labelling and so forth."

He said the Website would also provide a facility for stakeholders to report on suspicious product and Spirits NZ would regularly collate and forward relevant information to authorities.

Comment from NZ Customs

Customs revenue and assurance group manager Richard Bargh told the Shipping Gazette™ that although his agency's data did not suggest largescale smuggling of alcohol such as spirits was on the increase, nonetheless it was "taking this matter seriously".

"Customs is conducting its assessments and working closely with industry partners including Spirits NZ to ascertain the magnitude of this issue," he said.

"Following this groundwork, we will be in a better position to introduce or improve measures as needed."

According to Customs statistics released under the Official Information Act, there has been a total of 145,335 millilitres of alcohol intercepted in 126 incidents at the border in the January-June 2018 year.

The most prevalent interceptions during that period involved the descriptions of "spirits" transported by "passenger" - which encompassed 97,425 millilitres intercepted over 87 incidents.

The total of alcohol intercepted during the full 2015, 2016 and 2017 years has respectively entailed 21,001,492 millilitres in 303 incidents, 23,721,829 millilitres in 284 incidents and 370,492 millilitres in 282 incidents.

Mr Bargh said criminals used "all sorts of tricks and concealments" to hide illicit goods.

"For commercial-scale fraud, it is more likely the consignments are misdeclared or use lower-value or fake invoices to evade duty and GST.

"For example, a Customs investigation that resulted in a three-and-a-half-year jail term for the businessman was using double invoices to show a lower value and declaring shipments as beer instead of soju.

"As most trade is legitimate, and to minimise holding up clearance of legal goods, Customs uses profiling and intelligence to identify risk shipments for further scrutiny."

Mr Bargh encouraged industry and members of the public to "help play a role in targeting non-compliant shipments" by calling 0800 4 CUSTOMS in confidence.

Source: NZ Shipping Gazette

P.S. We'd love to answer any of your questions! Contact us now . Do you know of other people that will find this article useful? Please share it on social media. Thank you!

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NZ Importer Jailed for Smuggling Goods (What Can You Learn?)

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4-minute read Let's discuss the volume of alcohol being illegally imported into the country and imported without compliant labelling. What are the telltale signs of illegitimate product? Citing examples of imported shipping containers being declared as beer when they were predominantly filled with spirits.

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Nine baggage handlers arrested at Auckland Airport in $24 Million Drug Smuggling Bust

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Nine baggage handlers arrested at Auckland Airport in $24 Million Drug Smuggling Bust

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Who are the victims of the crime? New Zealanders! These drugs would have ultimately gone on to cause significant harm and cost to New Zealand communities. 64.5kg of methamphetamine 3.4kg of cocaine, this equated to about 3,225,000 doses of methamphetamine and 34,000 doses of cocaine.

What was the impact of the crime in terms of monetary losses? The methamphetamine had a street value of $22.5 million while the cocaine was worth $1.5m. The dispatch and end use of these drugs would have gone on to cause significant harm and cost to New Zealand communities, with the exact cost of that being unknown. When you consider the greater picture, you need to consider the cost involved in funding resources such as police, operation costs, court, lawyers and the end payer, the taxpayer, job loss, not forgetting the cost to run rehab facilities and increased pressure on the New Zealand public health system as a result.

What non-monetary losses did you identify? The impact these drugs would’ve had on our community is far and wide. It’s reported that some of the effects of using drugs include both financial and non-financial harm. For example, health, social impact, fear among community, increase of crime, income not going where it needs to go, specifically to families and children being raised in the homes of drug users.

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Nine baggage handlers arrested at Auckland Airport in $24m drug smuggling bust

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Meth and cocaine have been seized and 18 people face serious charges, police say.

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Crypto ATMs used to launder proceeds of crime

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Crypto ATMs used to launder proceeds of crime

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1. Victims: public fraud victims, romance scam victims

2. Financial impact: unclear on how many illegal funds have been laundered through the ~200 ATM in NZ, but these will be banned in 2025

3. Non-monetary losses: shut down of crypto ATMs for legitimate reasons, negative/illegal association for crypto-currencies

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Who were the victims

of the crime? Insurance Company & Driver of vehicle which was reversed in to.

What was the impact of the crime in terms of monetary losses? Vehicle repair costs or write-off. What

non-monetary losses did you identify? Impact on 2nd driver/owner of 2nd vehicle - stress, time for repairs etc, higher impact is uninsured.

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Dashcam video: Scammers reverse, crash into car in apparent insurance scam

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1. Who were the victims of the crime?

Australian public - Most victims were women over 51.

2. What was the impact in monetary terms?

Australians lost $3 million to scams involving crypto ATMs in the 12 months to January. The most common scams were investment scams (63), extortion emails (35), and romance scams (24). However, total losses are likely to be higher, as many victims do not report the crimes. One man is reported to have lost up to $1.4 million.

3. What were the non-monetary losses found?

The shut down of ATMs. Decreased consumer confidence. Elderly abuse and identity theft.

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Older Australians losing millions in scams involving crypto ATMs

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Australians are losing millions of dollars each year to scams involving cash deposits at cryptocurrency ATMs — machines authorities warn are increasingly being exploited by criminals for money laundering.

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Who were the victims of the crime?

Multiple US citizens but a particular focus on Heather Bradly. Their identity was being used to collect financial aid.

What was the victim of the crime in terms of monetary losses?

The victim had a loan in her name for 9,000USD that was paid out to someone else.

Overall California Government has identified a loss of 11.1 million dollars in the past year.

What non-monetary losses did you identify?

The decrease of students able to register for classes do to deep fake chat bots signing up.

Undermining the US Department of Education creditability to determine real vs fake AI profiles

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Scammers are using AI to enroll fake students in online classes, then steal college financial aid

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Financial aid fraud is exploding, thanks to the rise of artificial intelligence

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1. Victims - One individual. Retailers/bank also impacted depending on who is liable

2. Financial impact - $110,000

3. Non-financial impact - Lack of trust with the financial system, stress for the victim and the retailers impacted.

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NZ Herald9 Apr, 2025 04:09 AM2 mins to read

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$110k fraud scheme: Man allegedly used fake ID for electronics, hardware spree

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Police have laid 36 charges and a man has appeared in court.

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1. Victims - General population who fell for it. Perpetrators exploited digital platforms to sell counterfeit luxury goods.

2. Impact in monetary terms - 10 million AUD. Perpetrators sold fake high-end clothing, shoes, handbags and watches, moving an estimated $9.75m in profits through various bank accounts.

3. Non-monetary impact - Decreased consumer confidence in digital platforms. Impact of monetary loss on everyday life. Proceeds of crime may have been used for other crimes.

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news.com.au — Australia’s leading news site for latest headlines

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Police have busted a $10m counterfeit luxury goods ring, seizing nine luxury cars, hundreds of fake designer items, cash, and a firearm in sweeping raids across western Sydney.

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1. Who were the victims

of the crime?

12 investment scam victims, including Auckland businessman Deepak Udhani who lost $100,000 in June, 2023.

2. What was the impact of the crime in terms of monetary losses?

The 12 victims lost close to $1.8 million, altogether. This is likely a portion of the full amount stolen from overseas victims of which the funds were sourced from.

3. What non-monetary losses did you identify?

The loss of Sharma's clients being able to trust in his work given his reputation, meaning they will migrate to other tax/accountancy businesses.

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Suren Sharma, a Karaka accountant and Justice of the Peace, has been named in a near $1.8 million money laundering case.

Sharma allegedly helped offshore criminals steal from 12 investment scam victims, claiming he was also "duped" by the criminal enterprise.

The High Court found public interest in Sharma's role outweighed his request for name suppression.

A respected JP who allegedly used his bank accounts to help offshore criminals steal nearly $1.8 million from 12 investment scam victims has lost suppression and can finally be named.

Suren Sharma is a Karaka accountant and registered IRD tax agent who is also the director and shareholder of

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'Dagger through my heart': JP linked to $1.8m scam unmasked after failed secrecy bid

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A respected JP who allegedly used his bank accounts to help offshore criminals steal nearly $1.8 million from 12 investment scam victims has lost suppression...

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4billion AUD loss in revenue due to illicit tobacco

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4billion AUD loss in revenue due to illicit tobacco

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1.      Who were the victims of the crime?

Illicit tobacco robs government from obtaining revenue through excise and custom duties. This in turn impacts the larger community and economy. In 2023, illicit tobacco accounted for 28.6% of total tobacco consumption.

The perpetrators are also victims of the crime if they are caught and/or prosecuted. Some of these are unsuspecting mules – like students, aged population.

2.      What was the impact of the crime in terms of monetary losses?

If excise was collected on this volume of illicit tobacco, it would have generated $4.85 billion in additional government revenue based on 2023 excise rates

3.      What non-monetary losses did you identify

Potential for diseases due to increasing illicit import. Increased risk of tobacco related ailments due to ease of access to illicit tobacco. Impact to legitimate tobacco industry

Ref: bat-further-information-3.pdf (Vic parliament, 2023 report)

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Who were the victims of the crime?

The Person who was the Victim of the Identity Theft (Possibly others who were impacted by the same data breach/fraud)

What was the victim of the crime in terms of monetary losses?

The victims credit score Plummeted, and multiple buy-now pay-later loans were taken out leaving the victim with hundreds of dollars of overdue payments.

What non-monetary losses did you identify?

Fear of what else may have been done with the victims identity and the uneasiness of this reoccurring in the future. This may have also caused the victim to have distrust in institutional security.

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I was a victim of cybercrime. This is what I wished I’d paid attention to

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I was transferring my mobile number to a new provider when my phone service cut out. That was my first clue that my identity had been stolen.

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1. Who were the victims of the crime?

Individuals and genuine businesses

2. What was the impact of the crime in terms of Monetary losses?

The AFP seized properties and luxury cars allegedly purchased with tainted money - with frozen bank accounts totalling almost $21 million.

3. What Non - monetary losses did you identify?

Impact on the businesses operations

Ill gotten profits used to develop property portfolios

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Four charged with money laundering as $21 million in assets seized

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Police will allege four people were involved in an elaborate money laundering scheme that smuggled cash around the country.

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Summary:
A major police operation in western Sydney has dismantled a $10 million counterfeit luxury goods ring. Three men (aged 30, 30, and 33) were arrested during early morning raids on properties in Fairfield East, Merrylands, and Guildford. The group allegedly used social media to sell fake designer clothing, shoes, handbags, and watches, profiting nearly $9.75 million. Police seized nine luxury cars including Lamborghinis (worth approx. $3 million), over 500 counterfeit items, $270,000 in cash, and a gel blaster firearm. The homes resembled department stores due to the volume of goods. The NSW Police and Crime Commission are now targeting the illegally acquired assets and working to return funds to the public.

Victims of the Crime:
Consumers: Individuals deceived into purchasing fake luxury items online.
Legitimate luxury brands: Their intellectual property was infringed upon.
Legitimate retailers: Lost revenue due to unfair competition from counterfeit sales.
Wider community: Indirect victims, as organised crime drains public resources and trust.

Monetary Impact:
Estimated profit from counterfeit sales: $9.75 million.
Seized cash and assets: $270,000 in cash, nine luxury vehicles (~$3 million), and over 500 counterfeit items.
Ongoing asset recovery efforts: Targeting millions in illegal profits for public restitution.

Non-Monetary Impact:
Consumer trust erosion: Reduced confidence in online marketplaces and luxury goods authenticity.
Brand damage: Reputation harm to luxury brands due to counterfeit association.
Public safety concerns: Presence of weapons (e.g., gel blaster) and organised criminal operations in communities.
Resource strain: Law enforcement and legal systems diverted to investigate and prosecute such crimes.
Let me know if you'd like this reformatted for a presentation or report.

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news.com.au — Australia’s leading news site for latest headlines

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Police have busted a $10m counterfeit luxury goods ring, seizing nine luxury cars, hundreds of fake designer items, cash, and a firearm in sweeping raids across western Sydney.

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Algeria’s black market for foreign currency underlines its economic woes

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Algeria’s black market for foreign currency underlines its economic woes

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1.       Who were the victims of the crime?

Citizens of Algeria.

2.       What was the impact of the crime in terms of monetary losses?

The government estimates roughly $7 billion worth of foreign currency trades hands on the country’s black market. Distort country’s economy, discourage investment and encourage corruption. It would make purchasing certain goods difficult for Algerians.

3.       What non-monetary losses did you identify

Loss of confidence in Government and people falling deeper into poverty.

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Algeria’s black market for foreign currency underlines its economic woes

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Algeria’s black market for foreign currency underlines its economic woes

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1. Who were the victims

of the crime?

Members of the public. Australian businesses being impersonated.

2. What was the impact of the crime in terms of monetary losses?

Tax for the Government from the businesses. Members of the public losing money to spoof/fake set-ups.

3. What

non-monetary losses did you identify?

Brand damage, bank time to reverse charges and investigate.

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A good deal or too good to be true? Fake websites luring shoppers

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When shopping online, it’s tempting to jump at an attractive bargain.

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1. Who were the victims

of the crime?

The Federal and State Government, the taxpayers.

2. What was the impact of the crime in terms of monetary losses?

They acted egregiously against the interest of the tax payers while serving the taxpayer and billed unethically. The PWC Tax scandal where partners were using confidential government information to advises companies like FB and Uber to evade tax. Public Taxpayers Money worth $10 Billion dollars have been spent which can be accounting for more by the Federal and State in the past decade.

3. What  non-monetary losses did you identify?

Loss of trust in their organization and conflict of interest in advising both the Big MNC's on how to avoid taxes and the govt in advising on how to collect mor taxes.

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'Severe consequences' for PwC staff involved in tax scandal | The Business | ABC News

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1. Who were the victims of the crime?

The intentional and continual underpaying of vulnerable migrant workers.

2. What was the impact of the crime in terms of monetary losses?

The two companies intentionally underpaid employees under the Restaurant Industry Award Act 2010, including underpayment of casual loading and weekend/public holiday penalty rates as well as provided false records to Fair Work Inspectors which understated hours worked and provided false rates of pay. A total of $4 million was determined to have been stolen from workers.

3. What non-monetary losses did you identify?

Undermined trust in employers, as well as caused significant mental anguish on workers.

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From 1 January 2025, intentional underpayment of wages by employers will become a criminal offence with large penalties applied to both a company and individual if applicable.

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Online casinos based offshore are illegally targeting Australians on Facebook

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Online casinos based offshore are illegally targeting Australians on Facebook

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1. Who were the victims of the crime?

Australian Facebook users

2. What was the impact of the crime in terms of monetary losses?

Loss of income

Heavy penalties can apply for operators of online casinos, with offending corporations able to be fined up to $10.3 million a day

Nearly $3 billion in lost taxes

3. What non-monetary losses did you identify?

Reputational damage to Facebook

Lack of/lost trust in parent company Meta

Exploitation of vulnerable groups on Facebook

Potential lost trust in law enforcement to prevent ads of illegal activities such as online gambling

Limits the reach of the prohibition to exclude some illegal websites/illegal activities accessible by Australians

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Offshore casino illegally ‘partners’ with Facebook to target Australians

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A series of advertisements for an online casino that target Australians are being shown on Facebook. The case has reopened the debate about how easy it is for offshore businesses to use the internet to evade Australian law, writes Casey Briggs.

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1.       Who were the victims of the crime?

Australian Public, especially vulnerable community members who are vulnerable to drugs and families of those users.

2.       What was the impact of the crime in terms of monetary losses?

Appx, $1.5m in crypto currency, tens of thousands in cash, significant government resources used for the investigation

3.       What non-monetary losses did you identify?

Loss of lives, increase in violence, social and health impact of families affected by drug usage, loss of trust in police and in general increased criminal activity

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SA Police seize crypto, drugs, cash after arrest of alleged dark web drug trafficker

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Police will allege the 25-year-old Adelaide Hills man was operating several vendor profiles on the dark web selling a variety of drugs.

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Money Laundering in NZ

Who were the victims of the crime?

New Zealanders. The money launderers undermined the integrity of the financial system.

Honest businesses and institutions. They may have unknowingly facilitated money laundering.

Local communities - they deal with the effects of crime, drug addiction, and violence.

What was the impact of the crime in terms of monetary losses?

$1.35b NZD generated from illicit drugs that was laundered into the financial system.

Lost tax revenues that could help local communities.

Opportunity cost - government resources diverted to money laundering are not used on other pressing matters in the community.

What non-monetary losses did you identify?

Increased criminal activity - i.e. crime becomes incentivised due to being profitable and can be gotten away with.

Communities need to deal with the lives destroyed by drug addiction, trauma, poverty cycles etc.

Trust undermined in government and financial institutions - they may be seen as failing the NZ public.

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Money launderer to cops: ‘We’re not here to help you fight crime’

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Yvonne Tahana is investigating money laundering in NZ. She delves into the case of a woman who taunted authorities as they closed in on her illegal operation.

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Underpayment of Wages and Superannuation 

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Underpayment of Wages and Superannuation 

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Who were the victims of the crime?

2700 existing and 5500 former employees of UWA.

What was the impact of the crime in terms of monetary losses?

$6.6 million in re-paid superannuation contributions

$4 million in interest + unknown amount of potential wage theft on casual staff

What non-monetary losses did you identify?

Reputational damage to the university as an educational provider and employer.

Distrust from current and former employees

Emotional and financial stress of being underpaid and missed retirement savings.

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The University of Western Australia will repay thousands of former and current staff members to the tune of $10.6 million after self-reporting superannuation underpayments dating back more than a decade.

On Thursday, the university revealed superannuation underpayments had affected 2700 existing and 5500 former employees, leading the country's major tertiary education union to call for urgent reforms.

The university has reported wage theft to the Fair Work Ombudsman. Credit: Trevor Collens

In an email sent to staff, Vice Chancellor Amit Chakma confirmed the pay discrepancy had been reported to the Fair Work Ombudsman and that staff would be repaid $6.6 million, plus $4 million in interest.

It followed a review of superannuation entitlements by the university which identified shortfalls in the application of the 17 per cent superannuation contribution to some employee allowance and leave entitlements.

"We deeply regret this has occurred, and we offer our sincere apologies to those affected. We will continue to review the application of employee entitlements to ensure this does not happen again," Chakma wrote.

"It was unintentional and we assure you that the university had previously acted in accordance with what we understood to be our obligations.

"The university is committed to an ongoing culture of compliance, continuous improvement and review of its payroll processes and administration to ensure all university employees are receiving the correct entitlements."

The National Tertiary Education Union predicted the multimillion-dollar figure would rise when the university completed a review of potential wage theft from casual staff later in the year.

It is the latest wage theft scandal to rock Australian universities, with about 110,000 staff losing out on near $170 million in recent years.

The union's UWA branch president Dr Sanna Peden said staff had every right to be angry about unpaid superannuation entitlements stretching back more than a decade.

"We know this multimillion-dollar wage theft is only likely to get worse with management looking into possible underpayment of casual staff," she said.

"The union will do everything in our power to ensure staff are repaid in full for this egregious behaviour."

The union's acting WA division secretary Dr Scott Fitzgerald claimed Australian universities were robbing workers as part of a business model that thrived on exploitation.

"It's clear that federal and state governments' expectation that universities become exemplary employers is being ignored," he said.

"The only way we can stop the wage theft epidemic is by ending the insecure work crisis and fixing universities' broken governance model."
Start the day with a summary of the day's most important and interesting stories, analysis and insights. Sign up for our Morning Edition newsletter.

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UWA to repay $10.6 million after admitting superannuation underpayments

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The university's admission led Australia's major tertiary education union to call for urgent reforms.

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1. Who were the victims of this crime? Me, I was a victim of identify fraud

2. What was the impact of the crime in terms of monterary value? The bad actor/fraudster has purchased my information from the dark web as a result of the Optus Breach in 2023. They proceeded to open a online account with one of the smaller banks. They were successful at doing this. My account was to be used as a mule account. No money was lost or transferred as they slipped up and order a physical debt card which was sent to my address. I rang the bank as soon as I recieved this and reported the fraud

3. what non monterary losses did you identify? Lack of trust, paranoia, challenges ordering new medicare cards, license etc. and knock on the door from the local police who were investigating a case where my identity was used.

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1. Who were the victims of the crime?

Australian Community, especially people who are vulnerable to drugs & families and friends of those illegal drug users

2. What was the impact of the crime in terms of monetary losses?

Resources used & cost incurred during the law enforcement operations, cost incurred by court,  resources used by health system and rehabilitation  centres

3. What non-monetary losses did you identify?

Health harm, social impact, impact/fear of the community/households affected, stress on affected families & friends

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Two men with suspected links to organised crime have been charged over a $128 million cocaine seizure in Western Australia's remote Pilbara region.

It is alleged the men sailed offshore to collect the drugs from a "mothership"

A 49-year-old NSW man and a 37-year-old German man have been charged

A bulk carrier may have imported the drugs into Australian waters

The 320 kilograms of the drug were discovered in a campervan, wrapped in 1kg blocks, in Port Hedland on Sunday.

A 49-year-old man from New South Wales who was in the campervan was arrested, while a 37-year-old German man was arrested later.

It is alleged the German man came to Australia from overseas in early May to help retrieve the drugs.

Police said he then met up with the older man in Port Hedland and they travelled to Karratha, about 240 kilometres away, where they hired a 6.5-metre boat.

They are accused of returning to Port Hedland and launching the boat on both Thursday and Friday evening of last week to travel about 28 kilometres off the coast, allegedly to collect the drugs from a "mothership".

Police said the boat was seen idling near an international bulk carrier, and said investigations were underway to determine if that vessel was used to import the drugs into Australian waters from overseas.

Police said they believed the drugs were destined for the east coast.

AFP issues warning to criminal syndicates

The drug seizure was the result of a joint investigation by the Australian Federal Police (AFP), WA Police, the Australian Criminal Intelligence Commission and the Australian Border Force (ABF).

AFP Commissioner Reece Kershaw said the criminal syndicates behind the importation of drugs must be aware that police were coming for them.

"We will not stop, and we will be relentless," he told a media conference in Perth.

Acting WA Police Commissioner Col Blanch described WA's north as a hostile environment, something he said made investigations into the alleged importation difficult.

"It's a hostile environment in weather, in landscape. It's a very difficult area for law enforcement to operate," he said.

"To get surveillance, Tactical Response Group, detectives, specialist units out there every day to watch the activities of these alleged importers of drugs into our country was a spectacular effort, so I thank those officers who were involved in that operation."

Bulk carrier searched by police

ABF Commander James Copeman said his officers, along with WA Police Tactical Response Group officers, had boarded the international cargo ship to ensure any potential evidence was secured.

He said the ship was then directed to dock at Port Hedland, where more officers from the AFP and WA Police boarded the vessel.

"A comprehensive search of the vessel was then conducted and a significant number of electronic devices were seized," he said.

The two men are facing charges of importing a commercial quantity of cocaine and face possible life jail terms if convicted.

They made their first court appearance in South Hedland on Monday and were remanded in custody, with the pair due back in court next month.

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Police seize 320kg of cocaine from campervan in WA's north after drugs allegedly smuggled in by boat

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Two men with suspected links to organised crime are charged over a $128 million cocaine seizure in Western Australia's remote Pilbara region, with the drugs allegedly collected from a "mothership" off the coast.

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1. Who were the victims of the crime?

1. The Australian people. PwC’s tax expert - Peter John Collins helped the Australian Government design tax laws to ensure large foreign corporations like Apple, google etc were taxed fairly in Australia. With this insider knowledge to the new Multinational Tax Laws, Peter was able to help Multinational Companies and market to new potential Multinational Clients a Tax Avoidance Scheme to skirt around the same Laws he helped implement. This resulted in an increase of clients to PwC and tax avoidance of those large foreign corporations.

2. What was the impact of the crime in terms of monetary losses?

1.  The Australian people are potentially $180 million worse off, with the large foreign company’s tax avoidance.

3. What non-monetary losses did you identify?

1. Damage to the Australian government’s image

2. Damage to PwC’s image

3. Loss of trust between Australian government and Accounting firms - PwC has had numerous contracts with the Australian Government to consult and provide guidance on Government issues - With the contracts offered to PwC being paid with the tax payers money, the issue of PwC using this confidential information to gain and benefit their clients creates clear conflict of interest issues.

4. Possible Jail Time to all those involved in using confidential Government information to avoid the Multinational Tax laws.

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At least 53 people knew about the PwC tax leak — so why don’t we know who they are?

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Consulting giant PwC is embroiled in a scandal of its own doing, having used confidential government information to benefit its bottom line. Here’s how it happened, and what consequences the firm is facing.

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The construction company Walton Construction, where its directors accused of transferring assets to new entities before winding up the original company

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The construction company Walton Construction, where its directors accused of transferring assets to new entities before winding up the original company

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This left many creditors, including subcontractors unpaid. The case was a focal point for discussions about phoenixing and the need for stricter laws to prevent such practices.

1. Who were the victims of the crimes?

Subcontractors who provided services to Walton Consruction were among the primary victims, as they were left unpaid after the company's assets were transferred and the original entity was liquidated.

Suppliers who had delivered materials and goods on credit to Walton Construction also found themselves among the unpaid creditors.

The ATO was another victim, losing out on owed taxes due to the company's strategic insolvency.

2. Who was the impact of the crime in terms of monetary losses?

Subcontractors and suppliers collectively faced millions of dollars in unpaid invoices due to the illegal phoenixing activities.

The ATO lost significant revenue due to the unpaid taxes, contributing to the overall estimated annual cost of phoenixing to the Australian economy, which is around $5b (HHG Legal Group).

3. What non-monetary losses were identified?

The subcontractors and suppliers faced reputational damage and business disruptions, as many of them were small businesses reliant on consistent cash flow.

There was a loss of trust within the industry, as stakeholders became wary of engaging with companies that might engage in similar fraudulent practices.

The legal and regulatory systems were strained by the need to investigate and pursue complex phoenixing cases, diverting resources from other important matters.

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1. Who were the victims of the crime?

creditors

staff the were made redundant

2. What was the impact of the crime in terms of monetary losses?

loss of superannuation payments for the employers made redundant, loss of salary

creditors losing accounts receivable

loss of tax for government bodies

What non-monetary losses did you identify?

stress for people who lost jobs and companies that may now struggle with cashflow

time in court that could be better spent

loss of reputation for a business that had been running for 30 plus years

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Mosman couple Scott and Georgina (Georgie) McCorkell appeared separately in the Federal Court to be questioned about the failure of their North Sydney advertising agency in a transaction described as phoenixing.

The civil case brought by the liquidator of the agency is investigating whether the purchase price paid for the business, $29,000, in December 2022 was commercial. The McCorkells were the sole shareholders.

The court was told that dentsu in 2019 had offered $12 million to $14 million to buy McCorkell and Associates before the deal collapsed with management changes at the Japan-based global advertising agency.

The first day of an examination by the agency's liquidator looked at the salary paid to Georgina McCorkell, the candle business she ran from the agency offices, and the advice her husband received.

The court was also told the agency made a profit of about $680,000 in 2020, after receiving jobseeker payments during COVID. At the same time Georgina McCorkell was paid dividends of about $146,000.

The agency went into liquidation the week before Christmas 2022, putting 18 out of work without pay, redundancy or superannuation payments, and leaving a list of trade creditors.

The staff finally started to receive some money in May, paid via the Fair Entitlements Guarantee, a federal government backed scheme of last resort.

McCorkell Group, registered November 24 before the company went into administration, with Scott McCorkell its sole director, bought the business of McCorkell and Associates on December 14, 2022, for $29,129.61.

This new company, McCorkell Group, is still trading, using the same website, but with reduced staff.

According to documents lodged with ASIC, the first liquidator, Liam Bailey of insolvency firm O'Brien Palmer, introduced a valuer, Andrew Whittingham of Groves & Partners, to Scott McCorkell to establish a price for the agency.

Bailey was later deposed as liquidator in a narrow vote of creditors, which included the Australian Tax office and SAP Australia, a former client of McCorkell. This vote was instigated by Karen Powell, the former managing director.

Documents lodged with the court put the total value of creditors' claims at $3,062,180.

Both the McCorkells are listed as creditors, collectively owed more than $1 million, including thousands of hours in annual leave, despite Georgina McCorkell telling the court she and her husband took their full entitlement every year.

In the Federal Court yesterday, Scott McCorkell said he had been "concerned" about advice to save the business.

McCorkell was questioned by David Stack, legal counsel representing Michael Hogan, the new liquidator of McCorkell and Associates.

Stack repeatedly asked McCorkell about the advice he received from Liam Bailey of insolvency firm O'Brien Palmer to save the business.

McCorkell said he was given three options:

1. Continue trading and continue adding capital in the form of loans to the company

2. Go into administration

3. Or restructure the business by first valuing it and then forming a new company to buy the assets.

McCorkell went ahead with the third option and it is this which has been described to the court as having the hallmarks of phoenixing.

Phoenixing is where the assets of a company are moved to a clean shell of a company leaving behind debts and liabilities in the old business.

The Federal Court has issued a restraining order against McCorkell, preventing him from selling his interest in the family home at 57 Bay Street, Mosman. He also cannot sell the McCorkell Group.

McCorkell told the court he was "concerned" at the advice he was given and "hand on heart" said it was a huge decision to make after 32 years with the business he founded.

But what he aimed for was "a company that wasn't going to go broke".

He agreed, under questioning, that he had signed a backdated loan agreement to provide $500,000 to the company to pay wages. This was a loan from him to the company.

This was done to comply with requirements of the Personal Property Securities Register.

The liquidator is also questioning whether Georgina McCorkell was employed at the agency. The court was told she had a salary of $130,000.

The court was told she had a candle selling business, sometimes buying them and other times she made them herself.

This business was part of the MccCorkell and Associates. Candles were given to clients as gifts.

She also said she had an office at the agency and that she sometimes helped with events, looked after reception and bought furniture.

On questioning, she couldn't recall who paid her credit card, her husband or the company. Some of the transactions, listed under "Georgie expenses" included "Foxtel" and "glamorous pools".
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McCorkell founder and wife questioned in court on 'phoenixing' of failed ad agency - AdNews

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Identity fraud victim Ilker fears for his safety after hit-run committed in car hired under his name

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Identity fraud victim Ilker fears for his safety after hit-run committed in car hired under his name

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ABC Radio Melbourne

/ByRosa Ritchie

1. Who were the victims

of the crime? Melbourne man Ilker

2. What was the impact of the crime in terms of monetary losses? fraudulent traffic offences, public transport fines, possible costs to defend himself

3. What

non-monetary losses did you identify? Time and stress caused impacting his health & wellbeing

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Who are the victims of the crime?

-The community, especially those who are vulnerable to drug use/addition.

What was the impact of the crime in terms of monetary issues?

-Significant resources used by Police/Law enforcement, health system, Ministry of Justice/Court system.

What non-monetary losses did you identify?

-Health, Social and environmental harm

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Click here for PDF
Summary

Based on the 2019/20 New Zealand Health Survey, 1.1 percent of the total population, or an estimated 45,000 adults, had used amphetamine for recreational or non-medical purposes, or to get high, in the last 12 months. Methamphetamine is one of the most commonly used types of amphetamine.

Convictions for methamphetamine possession and/or use (including utensils) increased from 1,220 in 2011 to 3,404 in 2020.

Convictions for methamphetamine dealing and trafficking increased from 953 in 2010 to 1,831 in 2018, before declining to 1,566 in 2020.

With COVID-19 restrictions, methamphetamine prices reportedly increased significantly.

Methamphetamine was an underlying or contributory cause of, or documented as present in, 95 deaths in 2016, an increase from 46 in 2013.

Publicly-funded hospital discharges with a primary diagnosis indicating mental or behavioural disorders indicating methamphetamine more than doubled between 2015 and 2019, from 216 to 517. Over the same period, the number of publicly funded hospital discharges with a primary diagnosis of poisoning indicating methamphetamine increased from 46 to 84.

Use

The New Zealand Police National Wastewater Testing Programme results for the second quarter of 2020 showed that over the April to June 2020 period:

An average of 9.9 kgs of methamphetamine was consumed per week nationally.

The Bay of Plenty, Eastern and Northland police districts had the highest per-capita methamphetamine use.

The New Zealand Health Survey (NZHS) records the use of amphetamine (of which methamphetamine is a subset) across the population. In 2019/20, 1.1 percent of New Zealanders aged 15 years and over-an estimated 45,000 adults-had used amphetamine for recreational or non-medical purposes, or to get high, in the last 12 months. This compared to 1 percent in 2018/19. Amphetamine use was highest among Māori adults with a total of 2.7 percent (see Graph 1).

Graph 1: Amphetamine use by adults (15+ years) in selected population groups, years ending 30 June 2019 and 2020

Note: Data was collected for three-quarters of the 2019/20 survey year only. Ministry of Health New Zealand Health Survey Annual Data Explorer

For most years since 2011/12 total use by age has been the highest among 25 to 34 year-olds; 1.9 percent of people in this age range used amphetamine in 2019/20. This was an increase from 1.8 percent in 2018/19. Since 2011/12, total use by Māori has been the highest among ethnic groups. Use among Māori men was 3.9 percent (4.3 percent in 2018/19); 1.6 percent for Māori women (2.4 percent in 2018/19).

According to preliminary findings from the first online New Zealand Drug Trends Survey (NZDTS) of 2017/18, 17 percent of methamphetamine users said they were using the drug daily or near daily. Overall, 31 percent of users said they had felt dependent on methamphetamine during the previous six months. The regions with dependency levels of over 30 percent of users were Waikato, Gisborne/Hawke's Bay, Auckland, Manawatū-Whanganui and Bay of Plenty.

Charge convictions for methamphetamine possession and/or use (including utensils) increased from 1,220 in 2011 to 3,404 in 2020 (see Graph 2).

Graph 2: Methamphetamine possession and/or use (including utensils) charge convictions, calendar years ending 30 June 2011 to 2020

Note: Figures for graph two and three are from the Ministry of Justice Data tables - Methamphetamine offences

Supply

Preliminary findings of the first online 2017/18 NZDTS indicated that, across the country, methamphetamine was more readily available than cannabis. In all regions but two-Wellington and Otago- at least half of respondents classed access to methamphetamine as "very easy".

Preliminary findings of the second online NZDTS, conducted in 2018/19, indicated:

A national median price of $500 for a gram of methamphetamine, a fall from the median price of $538 in 2017/18.

Record-low median prices of $450 per gram in the Auckland, Waikato and Wellington regions.

The report's authors noted that the apparent decline in methamphetamine prices is consistent with long-term trends identified in other surveys. There remain regional variations in price: "the lower prices reported for methamphetamine in the central and upper North Island regions are consistent with their proximity to international smuggling routes...and the concentration of domestic methamphetamine manufacture in these regions."

Convictions for methamphetamine dealing or trafficking increased from 953 in 2011 to 1,831 in 2017/18. Convictions then declined to 1,566 in 2019/2020 (see Graph 3).

Graph 3: Convictions for methamphetamine dealing or trafficking, years ending 30 June 2011 to 2020

With COVID-19 restrictions disrupting international supply chains and the movement of drugs, it was reported in September 2020 that methamphetamine prices had doubled to over $1,000 a gram and $10,000 per ounce. The New Zealand Drug Foundation also warned users that the substance they acquired could vary in strength or have different ingredients substituted.

According to Police data, a 31 percent decline in methamphetamine consumption levels occurred in May, June and July 2020, with an average of 10.1kg consumed each week. This compared to an average of 14.6kg consumed weekly from April 2019 to March 2020.

For the period January to June 2020, New Zealand Customs seized about 109kg of methamphetamine, a drop from the 590kg seized in the first six months of 2019. This was accompanied by a significant fall in the amount seized of methamphetamine's pre-cursors, such as ephedrine and pseudoephedrine, and an increase from 23 to 38 in the number of meth labs 'busted' by the Police. The amount of methamphetamine seized by the Police in 2020 was 23.7kg, well down from the 615.5kg during the preceding year.

Health

Methamphetamine has had an increasing impact on the health of New Zealanders. Between 2013 and 2017, the annual number of deaths with an underlying or contributing cause of death, or nature of injury indicating methamphetamine, increased from 46 to 130 (see Graph 4).

Since 2013, methamphetamine has consistently represented at least 86 percent of the combined total of all deaths above described in relation to opium, heroin, cocaine, lysergic acid diethylamide (LSD), methylenedioxymethamphetamine (MDMA), and methamphetamine.

In 2017, provisional data indicated that methamphetamine was present in 19 accidental poisoning deaths; comparable numbers for heroin and cocaine were seven and one, respectively.

Graph 4: Deaths with an underlying or contributing cause of death, or nature of injury code indicating methamphetamine, years ending 30 June 2008 to 2017

Notes: 2017 data are provisional. Caution should be used when comparing data before 2013 with more recent data, due to the fact that better coronial data from 2013 onwards means that deaths are more likely to be coded as drug-related. Figures for Graphs four and five are from Ministry of Health Official Information Act responses (8 April 2019, 4 February 2020 and 1 February 2021).

In 2014/15, publicly funded hospitals discharged 46 cases with a primary diagnosis of poisoning indicating methamphetamine. This number peaked at 84 in 2018/19, before falling to 78 in 2019/20 (see Graph 5).

Between 2014/15 and 2019/20, the number of discharges from publicly funded hospitals with a primary diagnosis of mental or behavioural disorders indicating methamphetamine increased from 216 to 901.

Graph 5: Publicly funded hospital discharges with a primary diagnosis indicating methamphetamine, years ending 30 June 2015 to 2020

Notes: Discharge numbers do not necessarily reflect patient numbers. A patient may be discharged multiple times (for reasons such as transfer, readmission and multiple incidents).

Poisoning includes both accidental poisonings (i.e. overdoses, wrong drug given or taken in error, and drug taken inadvertently), and intentional poisonings (intentional self-harm, and assault).

Mental disorders can include withdrawal and thus does not necessarily mean that the patient was under the influence at the time of the hospitalisation.

Suggestions for further reading/links

Ministry of Health New Zealand Health Survey Annual Data Explorer

Ministry of Justice Data tables - Methamphetamine offences
Paul Bellamy and Dr Glenn Hardingham Research Services Analysts Parliamentary Library Research and Information
ISSN 2253-5624 (Print)

ISSN 2253-5632 (Online)

Disclaimer. Every effort has been made to ensure that the content of this paper is accurate, but no guarantee of accuracy can be given.

New Zealand Police Wastewater drug testing in New Zealand: Quarter Two 2020 Findings (December 2020) at 1. Nationwide wastewater testing covers up to 75 percent of New Zealand's total population. The report notes that "this quarter of reporting captures the immediate effects of national restrictions implemented in response to the COVID-19 pandemic. The significant changes in the post-COVID-19 environment, as well as the shift in quarterly reporting periods, mean that Q2 2020 is not easily comparable to previously reported quarters. April results have been excluded from Q2 2020 data as only three of the 45 sites were able to provide samples during this time due to risks associated with COVID-19".

Ministry of Health New Zealand Health Survey Annual Data Explorer Indicator: Amphetamine use in the past 12 months (total population) (November 2020). Data was collected for three-quarters of the 2019/20 survey year only; the interviewing for the NZHS was suspended on 19 March 2020 due to COVID-19, though "no adjustments or imputations" were done to account for the impact of this on the 2019/20 data. Note that the NZHS refers to amphetamine use rather than methamphetamine use. Methamphetamine is one of the most commonly used types of amphetamine. See Ministry of Health "Amphetamine Use 2015/16: New Zealand Health Survey" (December 2016) at 1.

Ministry of Health New Zealand Health Survey Annual Data Explorer Indicator, above n 2. In 2017/18, there was a change to the survey question, and caution is advised when comparing results with previous years. The ethnic groups are: Māori; Pacific; Asian; and European/other. It has been noted that the NZHS is likely to underestimate drug use like methamphetamine as interviews are conducted in person at the respondent's house, and it also excludes some people seldom at home, the homeless etc.

Chris Wilkins, Jitesh Prasad, Marta Rychert, Jose S. Romeo and Thomas Graydon-Guy "Which regions reported higher levels of methamphetamine and cannabis dependency and need for help with substance use problems? Social and Health Outcomes Research and Evaluation [SHORE] and Whariki Research Centre College of Health, Massey University Bulletin 2 (March 2018) at 1 and 2.

Chris Wilkins, Jitesh Prasad, Marta Rychert, Jose S. Romeo and Thomas Graydon-Guy "What drug is more available in New Zealand: Cannabis or Methamphetamine? SHORE & Whariki Research Centre College of Health, Massey University Bulletin 1 (March 2018) at 1.

Chris Wilkins, Marta Rychert, Jose S. Romeo and Thomas Graydon-Guy "What is the price of methamphetamine, cannabis, ecstasy and LSD in your region? SHORE & Whariki Research Centre College of Health, Massey University (October 2019) at 1 and 4.

Sophie Cornish "Nationwide meth use dropped by almost a third during and after lockdown" Stuff (24 September 2020).

Nikki Preston "Covid 19 coronavirus: Methamphetamine harder to get and more expensive due to Covid-19" New Zealand Herald (26 May 2020).

Robin Martin "Covid 19 coronavirus: Meth lab busts on rise as pandemic affects drug imports" New Zealand Herald (2 August 2020).

Kirsty Lawrence "Year of Covid-19 put brakes on New Zealand's meth market" Stuff (5 January 2021).

Deaths coded 'nature of injury' cannot necessarily be assumed to have been caused by methamphetamine.

Ministry of Health Official Information Act responses (8 April 2019, 4 February 2020, and 1 February 2021).

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Methamphetamine in New Zealand: A snapshot of recent trends - New Zealand Parliament

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Click here for PDF Based on the 2019/20 New Zealand Health Survey, 1.1 percent of the total population, or an estimated 45,000 adults, had used amphetamine for recreational or non-medical purposes, or to get high, in the last 12 months. Methamphetamine is one of the most commonly used types of amphetamine.

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1. Who were the victims

of the crime?

Australian banking customers who hold credit card that have been involved in card fraud.

2. What was the impact of the crime in terms of monetary losses?

Australians lost $2.2 billion in 2023.

3. What

non-monetary losses did you identify?

Extra efforts and time spent by Bank. Customers loses trust on Bank, negative impact to the whole Australia economy.

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1. Who were the victims

of the crime?

Australian Community

More specifically the Melbourne community where the drugs were being shipped to

2. What was the impact of the crime in terms of monetary losses?

Funding of police force to eradicate drug use

Associated health related risks place burden on health system

3. What

non-monetary losses did you identify?

Local community safety (weapons also)

Drug related community harm

Addiction services

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Trio charged for allegedly trafficking illicit drugs, criminal proceeds in secret vehicle compartments

Editor's note: Images and vision available via Hightail.

Three men have been charged for allegedly possessing and trafficking more than 55kg of illicit drugs hidden in secret compartments within a number of vehicles transported between NSW and Victoria.

The AFP will allege two Victorian men and a NSW man were key members of an organised criminal syndicate suspected of concealing illicit drugs, including cocaine, MDMA and methamphetamine, within a fleet of vehicles and transporting them via tray trucks from Sydney to Melbourne this year.

The men allegedly used purpose-built hides, located in the rear seat area of Toyota Camry sedans, to conceal and transport the illicit drugs and more than $1 million of criminal proceeds.

The AFP, with assistance from Victoria Police, executed a number of search warrants at residential properties in Deer Park, Niddrie, and Maribyrnong, Victoria, and a vehicle at Wagga Wagga, NSW, on 25 June, 2024.

During the searches police located and seized illicit drugs, including 22kg of cocaine, 3kg of MDMA, 1kg of methamphetamine, a quantity of cash, and two loaded firearms.

The AFP arrested a 23-year-old Niddrie man at Deer Park, and a 20-year-old man from NSW at Maribyrnong.

The men were each charged with:

One count of trafficking a commercial quantity of controlled drug, contrary to section 302.2 (1) of the Criminal Code Act 1995 (Cth);

One count of possess a commercial quantity of border controlled drug that is reasonably suspected of having been unlawfully imported, contrary to section 307.8 (1) of the Criminal Code 1995 (Cth).

The Niddrie man was also charged with one count of possess a traffickable quantity of firearms, contrary to section 7C of the Firearms Act 1996 (VIC).

On 28 June 2024, police identified a third man allegedly linked to the organised crime syndicate and executed a search warrant at a Craigieburn property. Investigators seized various electronic devices for further forensic analysis and arrested a 23-year-old man.

The AFP will allege the man was responsible for 25kg of methamphetamine, 5kg of cocaine and more than $1 million of suspected criminal proceeds located and seized with the assistance of Victoria Police, in the flooring of a van at Airport West, on 16 May, 2024.

The Craigieburn man was charged with:

Two counts of trafficking a commercial quantity of controlled drug, contrary to section 302.2 (1) of the Criminal Code Act 1995 (Cth);

Two counts of possess a commercial quantity of border controlled drug that is reasonably suspected of having been unlawfully imported, contrary to section 307.8 (1) of the Criminal Code 1995 (Cth); and

Dealing with money or property believed to be proceeds of crime, and at the time of dealing the value of the money or property was $1 million or more, contrary to section 400.3 (1) of the Criminal Code 1995.

All three men have been remanded in custody and are scheduled to reappear in the Melbourne Magistrates' Court on 29 October, 2024. They are each facing a maximum penalty of life imprisonment.

AFP Detective Superintendent Simone Butcher said police suspect the vehicles were modified with secret compartments to conceal a significant amount of illicit drugs in a failed attempt to evade detection from authorities.

"Organised criminal syndicates will continue to evolve and devise creative new concealment methods to avoid detection from law enforcement," Det. Supt Butcher said.

"Our message to criminals is clear: your efforts will fail and the AFP is always one step ahead of your plans.

"I would like to thank the AFP officers involved in the investigation and highlight their relentless efforts to disrupt criminal syndicates causing Australians immense harm through the vile drug trade.

"The amount of illicit drugs seized from this syndicate had an estimated street value of more than $11 million and had the potential to facilitate more than 37,500 individual street deals, if it had reached Australian streets.

"This seizure demonstrates the importance of collaboration between the AFP and Victoria Police, working tirelessly together to disrupt attempts by organised crime groups to import and traffic large quantities of illicit drugs into Australia.

"The AFP would also like to alert members of the public about purpose-built compartments in vehicles used to hide illicit commodities and encourage people to contact Crime Stoppers on 1800 333 000 or crimestoppers.com.au, to report suspicious activity anonymously."

Note to media

Media are encouraged to include help-seeking information in stories about illicit drugs to minimise any negative impact on people in the community. The following services provide people with access to support and information.

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Trio charged for allegedly trafficking illicit drugs, criminal proceeds in secret vehicle compartments | Australian Federal Police

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Three men have been charged for allegedly possessing and trafficking more than 55kg of illicit drugs hidden in secret compartments within a number of vehicles transported between NSW and Victoria.

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Understated Business Income - (AK)

Who were the victims of the crime?

Victims of understated business income in the black economy include both individuals and broader societal institutions.

Directly, workers are victims as they miss out on entitlements like proper wages, leave, and employee protection. Honest businesses are also victimized as they are undercut by competitors who avoid tax obligations, creating an uneven playing field.

Additionally, the general public suffers because reduced tax revenues from the shadow economy mean less funding for essential public services like healthcare, education, and infrastructure

What was the impact of the crime in terms of monetary losses?

The monetary impact of understated business income is substantial.

For the fiscal year 2019-20, the Australian Taxation Office (ATO) estimated that the shadow economy accounted for $12.4 billion, which was about 30.6% of the gross tax gap. Of this, small business income tax accounted for approximately $8 billion.

These figures highlight the significant loss of potential tax revenue, which could have been used to fund public services

What non monetary losses did you identify?

Non-monetary losses from the shadow economy and understated business income include diminished trust in the tax system and broader societal norms supporting voluntary compliance. This erosion of trust can lead to a decrease in overall tax compliance.

Additionally, the exploitation of workers, who may face poor working conditions and lack proper protections, is a significant non-monetary loss. There are also broader impacts such as the distortion of competition, which can lead to the failure of honest businesses and potentially increased criminal activities as organized crime networks often benefit from shadow economy activities

Sources

Shadow economy - Australian Taxation Office

The shadow economy explained - Australian Taxation Office

Implementation of the Government Response to the Black Economy Taskforce Report - Australian National Audit Office

(ANAO)

The Shadow Economy - RDP 2018-12: Where's the Money? An Investigation into the Whereabouts and Uses of Australian Banknotes (RBA)

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1. Who were the victims of the crime?

Everyday working Australians and businesses that pay correct tax;

Government Agency like ATO; Australian communities and economy

2. What was the impact of the crime in terms of monetary loss? Cash Payment is estimated to be $50 billion or 3 per cent of GDP; RBA estimates that $1 billion of cash is warehoused by the black economy with a further $5 billion used for "operational purposes". This represents up to 8 per cent of bank notes in circulation.

3. What non-monetary losses did you identify? Law abiding Australian business will find it harder to compete, Economic growth and infrastructure development is hampered.

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Who were the victims of the crime?

NZ community and with the transnational involvement, various offshore communities are also victims. These include those harmed directly or indirectly by drugs, taxpayers and members of society, unwitting cash couriers (predominantly international students).

What was the impact of the crime in terms of monetary losses?

The amount of money laundered was estimated to be NZD$26 million

What non-monetary losses did you identify?

Non-monetary losses include the NZ economy including loss of tax on laundered funds, time investment of NZ Police, strain on healthcare system and society due to illegal drug use which is ultimately where the funds have originated from.

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By George Block of

She was the churchgoing matriarch of a prosperous Auckland family whose money exchange business funded a St Heliers mansion.

Now Ye "Cathay" Hua, who laundered what a judge says was at least $18 million for the drug cartel of Xavier Valent, is the recipient of the longest prison term for money laundering ever handed down by a New Zealand court.

In the Auckland District Court on Thursday morning, Judge David Sharp sentenced the 58-year-old to seven years and six months in prison.

Crown prosecutor Sam McMullan said it was a case without comparison in New Zealand history.

"By value, Ms Hua's offending is many magnitudes more serious than any other case which has been before a court in this country," McMullan said.

A jury found Hua guilty of 15 out of 19 money laundering charges in July following a three-week trial.

All charges, carrying a maximum penalty of seven years each, alleged she either knew the cash was the proceeds of crime, or was at least reckless as to whether it was ill-gotten gains.

Most of the charges covered money allegedly sent overseas into foreign currency from her Newmarket money shop Lidong Foreign Exchange, or converted into bitcoin, at the behest of Valent.

He was jailed for life earlier this year for his role as the kingpin of his sprawling drug syndicate, which brought more than 100kg of meth into New Zealand from 2016 to 2020.

The remainder of the charges covered transactions with two low-level drug dealers and a former key lieutenant of Valent, who became the star witness for the Crown at Hua's trial.

He gave crucial evidence that helped seal her fate and was granted anonymity and immunity from prosecution on certain charges.

The witness said the cash could become wet or sticky - one of the key red flags in the Crown case - because it was being handled by people who were manufacturing or using meth.

Valent was a micromanager during the period he was travelling the globe on the run from late 2016 to his eventual arrest at the Italian border in 2020 on an Interpol warrant.

He would tell her when to expect one of his associates to arrive at Lidong's office in Newmarket, dubbed the "money shop" or "Newmarket money lady" in messages obtained by police.

Asked at the trial what was meant by the money shop, the secret witness was unequivocal.

"That's Cathay's money shop. Number 1 Kent St, Newmarket."

All charges against Hua alleged she either knew the cash was the proceeds of crime, or was at least reckless as to whether it was ill-gotten gains.

McMullan said she repeatedly ignored red flags, including the fact the money was sometimes wet or covered in powder and arrived in supermarket bags delivered by suspicious characters.

The amount of money Hua laundered was the subject of dispute prior to sentencing. The Crown contended it was $26m while defence said about $6m to $10m was more accurate.

Judge Sharp said he had concluded at least $18m was laundered across the 15 charges.

McMullan sought a starting point of 13 years in prison.

"Any mitigation provided to her ought to be tempered by the scale of her offending and the duration," he said.

Hua's lawyer, David Jones KC, made much at her trial of what he and witnesses described as her trusting nature that could extend to naivety and gullibility.

At sentencing, Jones compared her to situation to a scam victim whom others might view as stupid, but who would say "well, I trusted them".

He acknowledged prison was inevitable.

But he asked for Hua to be given some time to arrange her affairs, given she had dependant and vulnerable family members. This was granted by the Judge, who deferred the start of the sentence by 10 days.

Judge Sharp said he did not see the seven-year maximum on each of the individual money laundering charges as limiting, given the duration of her offending.

He adopted a starting point of 10 years, tempered with discounts for personal circumstances and good character, as testified in a large volume of letters placed before the court from family, former employees, and churchgoers and ministers.

The end sentence comprised cumulative sentences of six years for the first five charges, and a year-and-a-half for the rest.

"On any appreciation this is an extreme case of money laundering," Judge Sharp said.

This article was first published by The New Zealand Herald.

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Woman gets record prison term in money laundering case

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A churchgoing matriarch of a prosperous Auckland family is believed to have laundered at least $18 million.

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1) Who were the victims of the crime?

Australian People,

Australian Government (ATO)

Legitimate tobacco sellers

Individuals who grow and pack illegal tobacco who may not be coerced into the illegal business without access to proper wages and conditions.

2)What was the impact of the crime in terms of monetary losses?

about $6 million in lost excise.

3) What non -monetary losses you identify?

Impact on the Australian Taxpayers, who fund health and education programs through legitimate tax collected.

Continued smokers who are a burden on the health systems through the consumption of illegal tobacco.

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Police have raided a number of properties in Melbourne's north and Victoria's west, seizing 3.3 tonnes of illegal tobacco.

Police allege the properties are linked to the leader of an organised crime syndicate.

What's next?

Several men face charges related to illegal tobacco and firearms offences.

Authorities in Victoria have seized more than three tonnes of illicit tobacco as part of an operation targeting the illegal cigarette market.

Officers from Victoria Police's Taskforce Lunar raided properties in Melbourne's north-west and in the state's west on Thursday, seizing tobacco, cash and illegal firearms.

Five properties in Sydenham, Delahey and Melton South were raided as part of the joint operation between Victoria Police and the Australian Tax Office.

Police found 600 kilograms of illicit tobacco at a house in Delahey, as well as $90,000 cash and a number of improperly stored firearms.

Another 600kg of tobacco was found at another house in Delahey.

At two properties in Sydenham, police found 1,100kg of illicit tobacco, improperly stored firearms and documents relating to the manufacture of illicit tobacco.

At a property in Melton South, police found 1,000kg of illicit tobacco and 1.5kg of cannabis.

Four men, aged 30, 47, 35 and 39 face charges over the raids in Melbourne.

Five large rural properties were also raided in Landsborough and Barkly in Victoria's west.

Police failed to find any illegal tobacco, but 20,000 illicit cigarettes were found at a property in Barkly.

A 40-year-old man was questioned and released pending further enquiries.

Victoria Police said the total weight of the tobacco seized in the raids was more than 3.3 tonnes and represents about $6 million in lost excise.

Detective Acting Superintendent Mark Hatt from the State Anti-Gangs Division said the properties searched were linked to the leader of an organised crime syndicate.

"We have said previously that Victoria Police is focused on targeting syndicate leaders, directors, facilitators and organisers responsible for this criminal offending," he said.

"That remains a key priority for us, and we are doing absolutely everything we can to target them, to bring this criminality to an end and to make involvement in illicit tobacco as unattractive a proposition as possible for organised crime groups."

Police urged people not to buy illegal tobacco, as the proceeds fund organised crime syndicates.

"That money can be used to commit other crimes, such as an arson attack on a business, or to obtain an illicit firearm for a shooting. It is that simple," Detective Acting Superintendent Hatt said.

"If you are aware of illicit activity linked to a tobacco store, please come forward with that information so police can act."

Anyone with information has been urged to contact CrimeStoppers on 1800 333 000.

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Tonnes of tobacco, cash and illegal guns seized by police in raids across Melbourne and regional Victoria

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Police say more than three tonnes of illegal tobacco have been seized in raids on properties in Melbourne and regional Victoria. Police allege the properties are linked to the leader of an organised crime syndicate.

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Melbourne man (Ilker) was the victim of the crime when his details were used to hire a car after his license was stolen after losing his wallet. Someone registered a car in his name with Vic Roads. Monetary loss is possible due to public transport fines . Non monetary losses are connected to his own time dealing with the bureaucratic processes linked to challenging claims against him between Vic Police and Vic Roads

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Identity fraud victim fears for his safety after hit-run committed in car hired under his name

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Melbourne man Ilker has been dealing with fraudulent traffic offences, public transport fines and financial crime for three years, since his licence details were stolen.

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Counterfeit goods goes beyond luxury designer goods such as clothes and accessories; it also extends to the health and beauty industry, electronics, toys and food to name a few.

Who are the victims of crime?

Direct financial loss to impacted business/es.

Everyone loses from tax evaded; tax is vital for public services, our health care system, education, social services, aid assistance etc which benefits every person in society.

Jobs – sales are reduced which impacts employment. Workers of counterfeit products may also be poorly paid.

What was the impact of the crime in terms of monetary losses?

It is estimated that around $1.7 to 4.5 trillion of counterfeit products are sold globally each year according to the US Patent and Trade Office.

As highlighted above, tax losses (which probably cannot be quantified).

Increased tax - i.e. government resources spent to counter-counterfeit products impacting tax payers.

What non-monetary losses did you identify?

Counterfeit products undermine intellectual property rights. It is unfair and unethical.

Counterfeit products may also be connected to organised cross-national criminal activity such as human trafficking, drug trafficking and slave labour.

Habitual counterfeit purchasing may foster poor financial habits; products create a false sense of desirable and smart spending.

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In this exclusive op-ed, RMIT University senior lecturer in marketing in the School of Economics, Finance and Marketing, Dr Marian Makkar reveals how Gen Z are fuelling a movement that embraces luxury knockoffs and the implications for high-end retailers.

Once upon a time, owning a counterfeit luxury item was considered a fashion faux pas. If consumers owned luxury knockoffs, the goal was to make sure others believed they were original; and most certainly consumers were not bragging about the money they saved or where they bought it from.

Unfortunately for luxury retailers and luxury consumers alike, the appetite for counterfeit luxury has grown. The total amount of counterfeit products sold globally each year is estimated at around $1.7 to 4.5 trillion, according to the US Patent and Trade Office.

Contrary to common thought that this is only a problem for other countries to deal with (e.g., United States), Australia is not immune. In 2022, around 160,000 items were seized by the Australian Border Force (ABF) with a value of approximately AU$60 million.

While selling counterfeits is illegal, it has become harder for the ABF and other organisations to target counterfeit shipments with the latest developments in counterfeit production; superfakes. It has become harder to decipher what is original from a superfake, especially when Australian retailers like Cosette, are allegedly selling them.
What has changed in the counterfeit world?
Luxury brands have long waged a battle against counterfeit goods. Designer knockoffs have been around for more than a century, having gained prominence in the 80s and 90s with logos becoming a status symbol.

With the dramatic improvement in the quality of fakes, the battle with counterfeit producers is tougher than ever. Today's counterfeits are not the same as yesterday's inferior quality knockoffs; they are highly sophisticated Chinese duplicates that can fool even the most trained eye, while selling for a fraction of the price. These high-quality, low-priced counterfeits are known as "triple-a fakes," "line-for-lines", and more infamously today as "reps" (short for replicas), "dupes" (short for duplicates), or "superfakes" by social media influencers.

The difference could be minor that only expert authenticators can verify-inside etchings or one less stitching than in the original.

You will not find superfakes sold in the streets of Bali. Chinese manufacturers have become increasingly skilled at replicating designer goods in such detail. These manufacturers are known to source leather from some of the same Italian suppliers as the fashion houses and often buy the real designer handbags to study how they are made.

Superfakes come with real luxury prices; they are just cheaper than the original. Due to their notoriety, superfake best sellers are not always easy to find, which makes them more appealing as an exclusive products.

The shopping culture is shifting

Gen Z are embracing a "dupe culture". According to many social media influencers that helped fuel this luxury knock-off movement, buying dupes can support a lifestyle consumers would not have been able to afford otherwise. It has provided them with the thrill of bargain-hunting.

What is different in this era is the lack of furtive hush that once came with owning a knockoff. Dupe culture leans into pride that embraces fakes. Other Gen Z consumers rationalise dupes as a way to democratise fashion, especially in an era of rising inflation and economic concerns for young individuals. They even argue that buying superfakes is a way to knock off massive corporations like LVMH or Richemont. Influencers get to tell their followers about their impressive finds, and become the "Robin Hoods" of luxury for those on a budget.

Yet dupe influencers, as they are called, are also able to promote superfakes to a larger audience that can afford them and earn greater commissions from third parties like Amazon.

The result is that we are seeing more influencers using their social and cultural capital to create an acceptance around counterfeit items, making them desirable, and their young followers feeling savvy for buying them cheaply.

While it may not seem dangerous at first-given that superfakes are cheaper than originals and therefore not as financially impactful-there needs to be greater awareness surrounding the purchase of counterfeit items at a young age.

It is not a harmless purchase as many are led to think.
Why say no to fakes?
There are many reasons why consumers should not support counterfeits of any kind. Contrary to popular belief, counterfeiting is not a victimless crime. Consumers rationalising their knockoffs as innocent purchases is naïve as counterfeits in any form are illegal. It may seem harmless until they learn where their money is going. With the production and sale of superfakes, there is a chain of criminality and victimhood that is multilayered.

The sale of superfakes not only impacts luxury brands by violating their rights as trademark holders, but it also extends to small and medium retailers that do the right thing. It further harms consumers who might unknowingly purchase a product they might have thought was an original (but with incredibly low prices) like the consumer allegations made towards Cosette. Superfakes undermine intellectual property rights for everybody.

More significantly, there is much evidence that the manufacturing of fakes is connected to organised transnational criminal activity such as human trafficking, drug trafficking and slave labour. Workers are also likely to be paid poorly and work under harsh conditions. The popularity of superfakes harms legitimate businesses in Australia by contributing to an underground, illegal and unethical economy.
Dangers for young consumers
A critical issue that is not always acknowledged is that trends like superfakes and dupe culture create a slippery slope that can cost young people in the long run and contribute to addictive shopping habits.

Popularised by Gen Z influencers, superfakes are perceived as desirable and smarter choices over the original expensive brands. However, influencers themselves are spending more money on counterfeit items, such as Australian TikToker, Benjamin Luke Giles who spent $50,000 on fakes and admitted to his followers his addiction for buying clothes. Many of his followers (and other TikTok influencers) are young consumers that are learning how to make consumption decisions.

Like other addictions that may seem harmless at first (e.g., phone addiction compared to alcohol/drug addiction), superfakes, under the guise of their low price and high quality, exacerbate the lack of young Australian consumers' financial literacy. They are being encouraging to spend more, while learning bad habits around money management and debt.

The rise of superfakes is what in social psychology is called "trickle-round effect" where fashion influencers adopt items associated with low-status groups (e.g., counterfeits). Social media normalises the trend with influencers using their social capital (followers) and cultural capital (image as trendsetters) to make superfakes the new luxury.
What does this mean for luxury retailers and Australian businesses?
From a financial perspective, superfakes are becoming a source of massive competition on a global scale. Luxury brands are concerned with both legitimate competition that captures market share and counterfeiters taking revenue away from them. As the counterfeiting industry continues to grow, it is expected that we will also see many jobs being lost, with the current loss of global employment at 2.5 million jobs, caused by counterfeiting.

From a brand reputation perspective, counterfeiting also influences consumers' ability to trust brands in an open (and online) marketplace. With superfakes making it a lot harder to detect from originals, some consumers also do not see the reason why they should pay more for luxury goods when they have the option to buy the 'same' brand name and quality for less. For these reasons, it is incumbent on brands to protect their products, their image, and their customers from the rise of superfakes.

For instance, brands can work on creating awareness of the dangers of engaging with counterfeits products; produce authentication digital technology; or they can work closely with expert authenticators to help buyers verify their luxury purchases are not fakes.

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"The appetite for counterfeit luxury has grown", RMIT expert says - Ragtrader

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Senior lecturer Marian Makkar shares how Gen Z are fuelling a luxury "superfake" trend.

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AFP confiscates more than $640,000 cash and luxury watches allegedly linked to drug trafficking

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AFP confiscates more than $640,000 cash and luxury watches allegedly linked to drug trafficking

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1.     Who were the victims of crime?

Our Community

2.     What was the impact of the crime in terms of monetary losses?

Seized $641,980.00 in cash & 2 luxury watches approx worth $90,000.00.

The restraining of criminal assets and removing the profit from crime was a key strategy to ensure offenders did not enjoy lavish lifestyles at the expense of the community or reinvest tainted wealth into other illicit ventures.

3.     What non-monetary losses did you identify?

The seizing of about 5.7kg of methamphetamine. The two men were charged with trafficking a commercial quantity of methamphetamine and money laundering as part of the criminal investigation

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AFP confiscates more than $640,000 cash and luxury watches allegedly linked to drug trafficking

Editor's note: Images available via Hightail.

The AFP-led Criminal Assets Confiscation Taskforce (CACT) has secured the forfeiture of $641,980 in cash and luxury watches estimated to be worth about $90,000, which were seized by police during a drug trafficking investigation in Perth.

The CACT began an investigation after AFP criminal investigators executed search warrants at a warehouse and hotel rooms in Malaga and Innaloo allegedly linked to two men in September 2022, where they located and seized about 5.7kg of methamphetamine, the cash and two luxury watches.

The CACT investigated the source of the assets, and successfully applied to the District Court of Western Australia under the Proceeds of Crime Act 2002 (Cth) to have the cash and two luxury watches restrained and forfeited, with the consent of the two suspects.

The two men were charged with trafficking a commercial quantity of methamphetamine and money laundering as part of the criminal investigation and remain before the courts.

AFP Criminal Assets Confiscation Commander Allison Buck said restraining criminal assets and removing the profit from crime was a key strategy to ensure offenders did not enjoy lavish lifestyles at the expense of the community or reinvest tainted wealth into other illicit ventures.

"Many law-abiding Australians are feeling the pain of cost-of-living pressures, but people who gain money illegally can buy properties or enjoy lives of luxury without the same financial restraints," Commander Buck said.

"The AFP and its partners will ensure people are able to lawfully justify the wealth and assets they accumulate.

"The successful restraint and forfeiture of these assets is testament to the ongoing collaboration of AFP criminal and CACT investigators and litigators, who work hard every day to see the legal process through to completion.

"It is satisfying for our members to maximise their impact on the criminal environment."

The Commonwealth's proceeds of crime laws provide powerful tools for the restraint of both proceeds and instruments of crime, as well as financial penalty and unexplained wealth orders, based on a civil standard of proof. These laws operate separately to any criminal prosecution and can also operate when there is no related criminal investigation or prosecution.

The AFP-led CACT brings together the resources and expertise of the AFP, Australian Border Force, Australian Taxation Office, Australian Criminal Intelligence Commission and AUSTRAC. Together these agencies trace, restrain and ultimately confiscate criminal assets.

Once forfeited to the Commonwealth, assets are liquidated by the Official Trustee in Bankruptcy (Official Trustee). The funds derived from the sale of forfeited assets are placed into the Confiscated Assets Account, managed by the Official Trustee on behalf of the Commonwealth.

These funds can be distributed by the Attorney-General to benefit the community through crime prevention measures, diversion programs or other law enforcement measures across Australia.

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AFP confiscates more than $640,000 cash and luxury watches allegedly linked to drug trafficking | Australian Federal Police

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The AFP-led Criminal Assets Confiscation Taskforce (CACT) has secured the forfeiture of $641,980 in cash and luxury watches estimated to be worth about $90,000, which were seized by police during a drug trafficking investigation in Perth. ***Images available via Hightail***

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Underpayment of wages and superannuation

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Underpayment of wages and superannuation

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The underground economy of underpayment is a significant issue affecting many industries, especially those that attract vulnerable people. A prominent case study in Australia is the 7-Eleven wage scandal, where a systematic underpayment scheme was identified. Investigations revealed that franchisees were routinely underpaying staff, often only paying half of the wage entitlement. Many of these workers were international students and temp visa holders, who were in a vulnerable position by virtue of their inherent unlikeliness to report the exploitation due to fear of losing their jobs or facing visa repercussions.

Who were the victims:

While the primary victims were the exploited workers, who endured not only financial hardship but also stress and uncertainty, it is worth pointing out that this anti-competitive behaviour also victimises other businesses in the market - who will struggle to remain competitive against business who maintain an advantage via nefarious means and the tax payer, who misses out on the associated revenue from the underpaid wages.

What was the monetary value:

In monetary terms, the impact of this was significant. The Australian Fair Work Ombudsman identified underpayments totaling AUD $173 million. While wages were impacted it was also identified that superannuation contributions were impacted, the compounding nature of this is crucial to those employees' long term financial security.

What was the non-monetary impact:

The broader impact of this scheme is substantial, it undermines trust in the labour market, distorts fair competition, and causes significant mental distress to impacted workers.

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Years after 7-Eleven pay rorting revealed, justice finally done

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The glaring issue to this day is that a big company in Australia was able to underpay workers for so long.

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1. Who were the victims of the crime?

Customers, TSB Bank

2. What was the impact of the crime in terms of monetary losses

$28,000 stole from customers

3. What non-monetary losses did you identify?

Reputational damage to TSB. Distrust in the community.

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Her actions were captured on the bank's CCTV in which she was seen counting $50 notes from her teller drawer and placing them into a canvas banking bag, with no customer at her counter.

Last week, she appeared in the New Plymouth District Court before Judge Gregory Hikaka, who said Tumapang was in a trusted position at the only locally-owned bank in the country.

He said the bank had "a really good reputation" and the offending was so serious that it warranted a starting point of imprisonment.

According to the summary of facts, Tumapang began pilfering cash on August 11 last year.

On that date, she processed a withdrawal of $350 from the account of an 84-year-old man with a long-term cognitive impairment and then set the account to "inactive".

He was not in the bank when the withdrawal was made and did not give Tumapang, who coded it as "cash withdrawal", authority to complete the transaction. This was her modus operandi going forward.

One week later, Tumapang withdrew $1000 from another account owned by the same man, and on September 15 she took $2000, then $4000 on September 22.

On September 27, the man went into the branch and was served by Tumapang.

He filled out a bank slip to withdraw $2000, asking for $1400 to be transferred into a relative's account and for the remaining $600 to be paid in cash.

Tumapang completed those transactions but dishonestly amended the slip's monetary figure to read $3000, and paid herself the additional $1000.

Another customer, an 80-year-old woman with significant health issues, had $2500 stolen from her account by Tumapang on September 1, and a third target - a couple - had the most significant amount taken.

Without authority from the couple, Tumapang withdrew $8000 from their account on October 2, coding the transaction "to premier".

But she did not transfer the money to their premier account, instead taking the cash.

Tumapang repeated the action on October 16, though this time she took $8602.10 from their term investment account.

The final victim, a 73-year-old man, had $834.70 stolen by Tumapang from an account he was unaware existed, after opening it when he was in high school.

His wife had gone into the bank to query a letter sent to him stating the funds in his dormant bank account would be forwarded to Inland Revenue if unclaimed.

Tumapang was unable to find the account at that point and told the wife to disregard the letter but later, on October 11, she accessed the account and took the man's money.

The victim later received a second letter from TSB Bank about the account and his wife returned to query it.

This time she spoke with another worker who noticed the withdrawal and referred the matter to the assistant branch manager.

Tumapang had left her job at TSB before the fraudulent activity was discovered.

The total amount she stole was $28,286.80 and the bank has since refunded all the victims.

Supervision won't cut it

In court, Tumapang, who admitted all charges, appeared for sentencing.

Defence lawyer Sam Hunt argued for an outcome of supervision but the police prosecutor, Detective Sergeant Dave McKenzie, submitted it was not punitive enough.

Hunt said Tumapang has no criminal history, had repaid TSB Bank in full, attended restorative justice with bank representatives, was engaged in counselling and was genuinely remorseful.

She said the offending would never have happened if not for Tumapang's gambling addiction, and she was addressing that issue.

However, McKenzie said a significant amount of money was taken and Tumapang's actions were premeditated and were a breach of trust, and the victims were vulnerable.

Judge Hikaka agreed with McKenzie and said Tumapang took a callous and cruel approach to her offending by "carefully selecting victims".

"It's clear that you picked your victims. Elderly, some with cognitive issues, and people who did not have online internet banking, because they preferred face-to-face contact with someone they thought they could trust.

"Your breach of trust is significant."

The judge said one of the victims was "shocked and mortified".

He said supervision did "not cut it at all given the carefully planned, premeditated dishonesty" of her offending.

Hunt emphasised prison was not warranted in Tumapang's circumstances and if an electronically monitored sentence were imposed, only community detention would be appropriate.

But she said an adjournment would be needed so an address could be found for such a sentence.

Judge Hikaka tossed up between sentencing Tumapang to jail with leave to apply for an electronically monitored sentence or to adjourn the matter.

He entered the convictions and settled on remanding her on bail for sentence in September to allow time for an address to be sorted.
Tara Shaskey joined NZME in 2022 as a news director and Open Justice reporter. She has been a reporter since 2014 and previously worked at Stuff covering crime and justice, arts and entertainment, and Māori issues.

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'Shocked and mortified': TSB Bank teller stole from customers to feed gambling habit

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A bank teller who stole more than $28,000 from customers to prop up her gambling addiction chose her victims carefully - they did not use internet banking...

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Who are the victims of crime?

Individuals

Employees

State Government

What was the impact of the the crime in terms of monetary losses?

No direct reference to monetary losses but it did state that an estimated $85 million went through the casino, which could be the proceeds of crime.

What non-monetary losses did you identify?

Abuse of power by the casino operators.

Non compliance to the law.

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In short: The Federal Court has ordered the operator of Adelaide's casino to pay a $67 million fine in a money laundering case brought on by AUSTRAC.

Allegations in court documents revealed the casino had customers with links to organised crime, loan sharking human trafficking and sex slavery.

What's next? SkyCity already had set aside more than $70 million to cover the penalty.

The operator of Adelaide's casino has been ordered to pay a $67 million fine by the Federal Court over a money laundering case brought on by financial crimes agency AUSTRAC.

The civil action against SkyCity Adelaide found the company had failed to meet its requirements under anti-money laundering and counter-terrorism laws.

Allegations in court documents revealed the casino had customers with links to organised crime, loan sharking, human trafficking, and sex slavery.

On Friday, an AUSTRAC spokesperson said Sky City failed to carry out appropriate ongoing customer due diligence.

"Australia's free and open economy can be exploited by bad actors to launder illicit funds, and money laundering remains an intractable issue that comes with significant harm to the public," the spokesperson said.

"SkyCity admitted that its contraventions made it vulnerable to criminal exploitation, and exposed the Australian community and financial system to money laundering and terrorism financing risk."

The spokesperson said the casino's failure over many years allowed high-risk customers to move millions of dollars through the casino.

"In ways that made the source and ownership of the funds unclear," they said.

"It failed to carry out required checks on 121 customers, including where SkyCity knew customers were the subject of law enforcement interest, or where there were indications that some posed a higher risk of money laundering."

The company has also been ordered to pay $3 million in costs.

AUSTRAC acting chief executive,Peter Soros said casinos, like all businesses, must take their anti-money laundering obligations seriously.

"Criminals will always seek to take advantage of the gambling sector to clean their dirty money," Mr Soros said.

"Today's result shows AUSTRAC is prepared to take action when businesses, including casinos, fail to comply with the legislation.

"Businesses who ignore their obligations are affecting the Australian community by leaving the door open to criminal activity."

In May, SkyCity Adelaide and AUSTRAC said they had filed a joint submission with the Federal Court to propose a $67 million penalty over the casino's misconduct.

South Australia's Consumer and Businesses Services department appointed retired Supreme Court judge Brian Martin KC in 2022 to investigate whether SkyCity was suitable to operate the casino.

That investigation had been put on hold while AUSTRAC pursued SkyCity through the Federal Court court.

In a separate legal case SkyCity said the High Court had agreed to hear an appeal on how state government taxes are calculated on loyalty rewards points.

The casino has been in a dispute with the South Australian government about whether the loyalty points constitute as taxable revenue when customers convert them to gamble on gaming machines.

In a statement to the stock exchange, SkyCity said it secured a High Court appeal against an earlier South Australian Supreme Court ruling.

If it is unsuccessful, SkyCity said it could be forced to pay more than $22 million.

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Adelaide casino fined $67m over money laundering case

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The Federal Court has ordered the operators of Adelaide's Casino to pay $67 million, in a money laundering case brought on by financial crimes agency AUSTRAC.

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Australian Bureau of Statistics reveal details of 'sizeable' increase in card fraud as Australians lose $2.2 billion in 2023

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1. Who were the victims of the crime?

The number of Australians affected by card fraud has climbed to 8.7 per cent in 2022-23, with people aged 45-54 the most frequently affected.

2. What was the impact of the crime in terms of monetary losses?

An Australian Bureau of Statistics report says an estimated gross amount of $2.2 billion was lost to card fraud. The net loss by all victims after reimbursement was $476 million.

3. What non-monetary losses did you identify?

Victims of fraud likely experienced increased stress levels, while institutions and police expended significant time on investigations.

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In short: There has been a "sizeable" increase in the number of Australians affected by card fraud in 2023, compared to the previous year.

An Australian Bureau of Statistics report says an estimated gross amount of $2.2 billion was lost to card fraud.

What's next? The ABS and ACCC say Australians are becoming "more and more aware" of personal fraud and scams.

Australians lost an estimated $2.2 billion to card fraud last year, according to new data released by the Australian Bureau of Statistics (ABS).

The ABS report released on Wednesday also revealed 1.8 million people (8.7 per cent) experienced card fraud in 2022-23, an increase on the previous year (8.1 per cent).

A further 514,300 (2.5 per cent) experienced some kind of scam, and just under 200,000 (1.0 per cent) were victims of identity theft.

Card fraud, according to the report, involves using "credit, debit, or EFTPOS card details "to make purchases or withdraw cash without the account owner's permission".

The number of Australians affected has climbed from 6.9 per cent in 2020-21 to 8.7 per cent in 2022-23, with people aged 45-54 the most frequently affected.

ABS head of crime and justice statistics William Milne said the organisation had seen a "sizeable increase" in those falling prey to card fraud.

"The other thing interesting is who's most at risk of card fraud," he said.

"It tends to be older people, 35-64 year olds, those in a married relationship, and those in a higher income bracket.

"When you think about it that makes perfect sense, because they're the ones who have more access to credit cards, debit cards, those sorts of financial instruments.

"Personally I think it's going to be the number of cards you're holding that increases your likelihood of card fraud."

People who were married were almost three per cent more affected than people who were unmarried.

Also more affected by card fraud were people living in capital cities, people with tertiary or post-school qualifications (including a "certificate, diploma or degree"), and people in the highest bracket of weekly household incomes.

"The median amount that was fraudulently withdrawn or spent was around $200 for each card fraud incident," Mr Milne said.

The gross amount withdrawn was $2.2 billion, an average of about $6 million per day. The net loss by all victims after reimbursement was $476 million.

The Australian Competition and Consumer Commission released its own 2023 report last week, noting more than $82 million of the final amount had been lost during the last three months of 2023.

An ACCC spokesperson told the ABC while the ABS data represented a "sample of the Australian population", Scamwatch data was "based on reports made by people who have experienced a scam."

"It is important to note that the two datasets are not measuring the same thing and use different parameters," they said.

"We note that the ABS data, like Scamwatch, shows that 'buying and selling' and 'information request or phishing' are two of the most commonly experienced scam types in Australia."

Fewer Australians falling for phishing scams

The rate of Australians falling victim to scams dipped slightly from 2.7 per cent in 2020-21 to 2.5 per cent in 2022-23, with people aged between 35-44 the most frequently affected.

A scam is a "fraudulent invitation, request, notification or offer" aiming to obtain personal details or money "or otherwise a financial benefit by deceptive means", according to the ABS report.

"In the context of the survey, experiencing a scam meant the person responded to a scam by seeking further information, providing money or personal information, or accessing links associated with the scam," it said.

"In 2022-23, the most common type of scam people experienced was a buying or selling scam (1.0 per cent or 199,200), followed by an information request or phishing scam (0.6 per cent or 134,700)."

The number of people being notified about a scam incident by their bank or a financial institution rose to 49 per cent, up from 32 per cent in the previous year.

"We're only interested in those who responded to scams this time," Mr Milne said.

"That's [people] that have actually gone in and clicked the link into the follow-up process.

"People are becoming more and more aware of it and, I'm hoping, getting more clever at recognising it before they get too invested."

Rates of identity theft increased only slightly from 0.8 per cent to 1.0 per cent between 2021-22 and 2022-23.

According to the report, "identity theft is the use of someone's personal details in stolen, fraudulent, or forged documents without permission, or otherwise illegally appropriating another's identity".

"Online impersonation occurs when someone's personal details have been purposefully misused to impersonate them online or by phone, without their permission."

In most cases of identity theft the information was used to obtain money.

"We found that about 200,000 people had had their identity stolen, and in about a third [of cases] they've actually used these documents to obtain money from a bank, super fund, or from shares or dividends," Mr Milne said.

"You sort of think, 'it's ID theft, what can they do?' They can actually create your identification and scam your money."

The ACCC has advised people who think they have been scammed to contact their bank or financial institution, then the platform on which they were scammed and inform them of the incident.

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Almost 2 million people were victims of card fraud in 2023 as hardest-hit group identified

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Australians lost an estimated $2.2 billion to card fraud last year, according to new data released by the Australian Bureau of Statistics.

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Counterfeit goods: a bargain or a costly mistake?

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Counterfeit goods: a bargain or a costly mistake?

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1. Who were the victims of the crime? Counterfeiting can affect everyone - governments, business and society.

2. What was the impact of the crime in terms of monetary losses? The value of counterfeiting is estimated by the OECD to be in the region of $250 billion per year.

3. What non-monetary losses did you identify? Counterfeiting can affect what we eat, what we watch, what medicines we take and what we wear. For example, the buying of fraudulent pharmaceuticals. There are numerous examples of disability and death caused by tainted medication.

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The production and sale of counterfeit goods is a global, multi-billion dollar problem and one that has serious economic and health ramifications for Governments, businesses and consumers. Counterfeiting is everywhere - it can affect what we eat, what we watch, what medicines we take and what we wear - and all too often the link between fake goods and transnational organized crime is overlooked in the search for knock-offs at bargain-basement prices.

The hand of organized crime

Counterfeiting is a hugely lucrative business, with criminals relying on the continued high demand for cheap goods coupled with low production and distribution costs. The illegal activities related to counterfeiting take advantage of unwitting consumers and bargain-hunters, exploiting people's appetites for cut-price brands or simply their financial position.

While the costs are difficult to quantify - and do not include non-monetary damage such as illness and death - the value of counterfeiting is estimated by the OECD to be in the region of $250 billion per year.[1] While counterfeiters continue to reap significant profits, millions of consumers are at risk from unsafe and ineffective products.

It is a truly transnational problem. The World Customs Organization noted that in 2008 counterfeit products destined for 140 countries were detected.[2] In many countries the absence of deterrent legislation encourages counterfeiters, since they have less fear of being apprehended and prosecuted than they would for other crimes. Counterfeiters engage in elaborate plans to disguise their activities. They establish fictitious businesses and front companies. They exploit border-control weaknesses and poor regulatory frameworks. And they use false documents to obtain pharmaceutical ingredients, as well as manufacturing equipment to replicate genuine products.

The criminal networks behind counterfeiting operate across national borders in activities that include the manufacture, export, import and distribution of illicit goods. The scale and ingenuity of the trade in counterfeits poses a formidable challenge to law enforcement authorities, as counterfeiters adopt extremely flexible methods in order to mimic products and prevent their detection. Criminal organizations are also often involved beyond just producing and moving counterfeit goods, with many also trafficking drugs, firearms and people.

A bargain...or is it?

Counterfeiters are involved in the illegal production of knock-offs in virtually every area - food, drinks, clothes, shoes, pharmaceuticals, electronics, auto parts, toys, currency, tickets for transport systems and concerts, alcohol, cigarettes, toiletries, building materials and much, much more. Often the temptation for consumers can be too strong to resist, with many not understanding the risks and ramifications attached to this illicit industry. Buying a counterfeit handbag or pair of jeans, for example, might not be regarded as an illegal transaction - simply a cheaper way to wear the latest fashion goods. However, often little thought is given to how the money may ultimately end up in the hands of organized crime groups or how the industries that rely on legitimate sales suffer. The buying of fraudulent pharmaceuticals can obscure the long-term risks: there are numerous examples of disability and death caused by tainted medication, and such pharmaceuticals contribute to the growth of drug-resistant diseases. Even obscure purchases like safety goggles or electrical plugs that have been illegally copied and reproduced present significant risks, given their lower quality. Counterfeit cigarettes also present multiple risks: they are even more harmful than genuine cigarettes, as they may contain much higher levels of nicotine and other dangerous chemicals such as arsenic, benzene, cadmium and formaldehyde.

The criminals behind these operations present huge challenges to all sectors of society: they threaten public health through the production of fraudulent medicines; they deprive the public sector of tax revenue through bypassing official channels; they add to public spending through increased law enforcement work to counter this illicit trade; and they increase the price of legitimate products as companies seek to recoup their losses.

More taxes, more expense, fewer jobs

The ramifications of counterfeiting affect everyone, with Governments, businesses and society being robbed of tax revenue, business income and jobs. The flood of counterfeit and pirated products creates an enormous drain on the global economy by creating an underground trade that deprives Governments of revenue for vital public services and imposes greater burdens on taxpayers. It also leads to more public resources being spent on fraud-detection methods by public sector authorities and larger intelligence and policing budgets being needed to counter sophisticated schemes and networks. Counterfeit goods also undermine employment, as products are copied and produced illegally, thereby displacing sales of original merchandise and reducing the turnover of legitimate companies. Fraudulent medicines also have a direct impact on increased medical costs due to prolonged treatment periods and medical complications in the spread of treatment-intensive diseases. The prices of products also go up because companies increase security systems to counter organized criminal activities and have to invest more in research and development.

Exhibit A: Phoney pharmaceuticals - an unfolding public health tragedy

One of the most harmful forms of counterfeit goods is fraudulent medicines. In recent years there has been a marked increase in the manufacturing, trade and consumption of these products - often with harmful results, and at times fatal. The sale of fraudulent medicines from Asia to South-East Asia and Africa alone amounts to some $1.6 billion per year[3] - a sizeable amount of money being fed into the illicit economy. The World Health Organization estimates that up to 1 per cent of medicines available in the developed world are likely to be fraudulent. This figure rises to 10 per cent in various developing countries, and in parts of Asia, Africa and Latin America, fraudulent pharmaceuticals amount to as much as 30 per cent of the market.[4] In an article in the medical journal The Lancet in mid-2012, it was noted that one third of malaria medicines used in East Asia and sub-Saharan Africa are fraudulent.[5]

Tampered formulations present particular dangers. These types of medicines are found either to contain the wrong dose of active ingredients, or none at all, or to have a completely different ingredient included. In some cases, fraudulent medicines have been found to contain highly toxic substances such as rat poison. Fraudulent medicines also deprive sick people of treatment, leaving them vulnerable to the disease they are meant to be fighting. They also make some of the world's most dangerous diseases and viruses stronger by contributing to the development of drug-resistant strains, as the active ingredients are no longer able to work correctly. More resistant strains are then passed on to other victims, and the legitimate drugs they take to fight the same disease are less effective.

All kinds of medicines - both branded and generic - can be made fraudulently, ranging from ordinary painkillers and antihistamines, to "lifestyle" medicines, such as those taken for weight loss and sexual dysfunction, to life-saving medicines including cancer treatment and heart disease drugs. Medications for treating depression, schizophrenia, diabetes, blood pressure and cholesterol are also among the commonly faked medicines.

In West Africa there has been a marked increase in fraudulent medicines, including antibiotics, antiretroviral drugs and medicines to fight life-threatening diseases such as malaria and tuberculosis. Meanwhile in Asia - a key manufacturer of legal medicine - the production of fraudulent drugs is seen to be on the rise. According to statistics from the World Customs Organization, around two thirds of counterfeits (medicines and other goods) detected globally in 2008 were shipped from East Asia.[6]

Exhibit B: Fake food - a deadly meal

Another area that continues to be exploited by counterfeiters - and one that is often not considered in the public mind when discussing fake products - is foodstuffs. Every year thousands of consumers throughout the world are deceived into buying expensive counterfeit foodstuffs. A ploy favoured by criminals is to intentionally mislabel and misrepresent foods as luxury items or as originating in certain countries, allowing them to raise prices. A recent estimate based on data from the United Kingdom Food Standards Agency[7] suggested that fraud could affect as much as 10 per cent of all the food bought in that country. One such example is that of "wild" salmon, which, it is estimated, is in fact farmed fish in one out of every seven cases.

But it is not simply a matter of people being conned into believing that they are eating superior food. In just one example of the life-threatening potential of the trade in counterfeit foodstuffs, thousands of Chinese babies became sick in 2008 after drinking contaminated milk formula containing melamine, a chemical normally used in plastics. While the chemical is banned from use in food, it is added to watered-down milk in order to make the liquid appear higher in protein when tested. The ripples of this food scare were felt internationally, with fears that the contaminated products may have reached Europe and beyond. There have also been cases where rat poison and other dangerous chemicals have been found to be present in fraudulent food in place of other more expensive and legitimate additives.

International cooperation and consumer power

The counterfeit business is a global operation spread across numerous countries and organized by cross-border criminal networks. In a bid to tackle these crimes there is an ever-growing need for action at both the local and the international level. The United Nations Convention against Transnational Organized Crime is the world's most inclusive platform for cooperation in tackling this issue.170 countries[8] are currently party to the Convention and have committed themselves to fighting organized crime locally and internationally by such means as collaboration and ensuring that domestic laws are suitably structured. In October 2012 UNODC will be hosting the Conference of the Parties to the United Nations Convention against Transnational Organized Crime. This biennial series of meetings brings together Governments from across the world to promote and review the execution of the Convention in order to ensure better implementation in tackling this international issue.

Organizations such as INTERPOL and the World Customs Organization are also central to tackling this sort of crime, particularly given the cross-border nature of the operations behind counterfeiting. This provision of a crucial link between law enforcement agencies is a good example of the kind of actions necessary to curb transnational organized crime networks.

There is also a great need to build more awareness of the scale of the problem. The responsibility for this is widespread, with international organizations, public health authorities, trade organizations, consumer groups and concerned citizens all able to play their part and make people aware of the dangers of counterfeit goods to health and safety. Private companies complicit in this trade should, for instance, be named and shamed, and codes of conduct more rigorously enforced.

Law enforcement agencies should also take a tougher stand against counterfeiters, and that stance ultimately has to be backed up by relevant and comprehensive local laws. Coordinated and cross-sector action at the international level is vital for identifying, investigating and prosecuting these criminals. One such area in which measures are lacking in many parts of the world is that of rogue Internet pharmacies, which operate with little fear.

Consumers also have a responsibility to exert their influence with their purchasing choices. While consumers often cannot identify counterfeit goods, such as medicines containing dangerous products, the more evident purchases of counterfeit products should be shunned. Counterfeiting networks can - and will - continue to operate as long as customers support this form of illegal trading.

If you know a film has been illegally copied and is being sold as a knock-off, don't buy it. If your favourite designer brand is clearly not made by your favourite designer, stay away. Beyond these obvious counterfeit products, stay alert to other warning signs. If a medicine that you know normally requires a prescription is available online without any sort of script from a doctor, then it could harm your health, perhaps irreversibly. Remember - while these purchases may save you money in the short term, the longer-term losses are far more costly.

This fact sheet has not been formally edited. The content of this fact sheet does not necessarily reflect the views or policies of UNODC or contributory organizations and neither does it imply any endorsement. The designations employed and the presentation of material in this fact sheet do not imply the expression of any opinion whatsoever on the part of UNODC concerning the legal status of any country, territory or city or its authorities, or concerning the delimitation of its frontiers and boundaries.

Sources

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un un united united nations nations office on drugs and crime office on drugs and crime

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Counterfeit goods: a bargain or a costly mistake?

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The production and sale of counterfeit goods is a global, multi-billion dollar problem and one that has serious economic and health ramifications for Governments, businesses and consumers. Counterfeiting is everywhere - it can affect what we eat, what we watch, what medicines we take and what we wear - and all too often the link between fake goods and transnational organized crime is overlooked in the search for knock-offs at bargain-basement prices.

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1. Who were the victims

of the crime?

Employees of the company at the time of employment

Community - Government tax expenditure

Businesses earnings - future services

2. What was the impact of the crime in terms of monetary losses?

Employees, loss of interest on superannuation payments

Employees, loss of wealth in retirement.'

Company director - loss of wealth

3. What non-monetary losses did you identify?

Community impact, loss of wellbeing in retirement

Further business community impact, loss of earnings

Government reduction of GST payments in future transactions.

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A day after his 52nd birthday, Andrew Christodoulou got a nasty surprise in the mail.

A letter from the Australian Taxation Office (ATO) in November last year read: "You have been issued with a director penalty notice for Superannuation Guarantee Charge amounts".

"A director's penalty notice. I've never heard of one," Mr Christodoulou tells ABC News.

"It rocks up on the doorstep. And my wife opens it with the rest of the mail. And it essentially says in no fewer words that you owe $437,000. You have 21 days to pay it."

He's thinking, 'it must be a mistake'.

"How the hell could I owe $437,000 - it is more than my mortgage," he says.

The ATO is alleging the company that Mr Christodoulou ran for 22 years, which went into voluntary administration in 2016 and shut down three years later, owes superannuation to workers it employed at the time.

Some of the alleged debts date back to April 2013 while Mr Christodoulou was a director of the security firm, Kudos Australasia.

Company directors are responsible for ensuring that the company's tax and super obligations are reported and paid on time.

If the company does not pay certain liabilities by the due date, the ATO can recover these amounts from the director personally, and do it after the fact, going after them as a former company director.

Through the pandemic, these powers were rarely used.

But after years of going easy, the tax office is back and it's going hard to recoup tax and super debts it says current and former directors owe.

The federal government is also backing the ATO.

Do you know more?

If you have more information about this story please contact Nassim Khadem at khadem.nassim@abc.net.au

It has instructed the tax office to chase more than $34 billion worth of debt owed by small businesses and self-employed Australians, many of which were put on hold during COVID.

The agency is issuing more director penalty notices, as well as garnishee notices, which allow it to take money directly from a person's bank account or employer.

This stronger action is pushing businesses into making the call to go into insolvency or face being forcibly wound up by the ATO.

It's a big reason why calls to debt helplines have skyrocketed and the rate of insolvencies is now tracking around peaks seen just after the global financial crisis.

'No clarification'

As he works to resolve the dispute, Mr Christodoulou says legal fees are piling up, and he fears the ATO may personally bankrupt him.

Mr Christodoulou agrees that workers should be paid their superannuation but argues the unpaid super debt should have been dealt with at the time.

"These debts that they are chasing were listed from 2013 - we're talking 11 years ago now," he says.

"If they [the ATO] had come to us in 2014 or 2015, and said, 'Hey, there's a $35,000 debt, or you owe John Smith $200, or you owe Frank Jones $400', we could have sorted it out," he argues.

"Back then it was absolutely doable.

But to come forward all these years later, with a figure that has no justification, no clarification around it, and give you 21 days to figure it out?"

The Brisbane-based company he set up in the 1990s installed audio-visual equipment, including security systems and CCTV technology, with IGA, McDonald's and Subway among its clients.

The company had taken on several large customer contracts, including one for the Commonwealth Games, that seemed attractive but ended up becoming more than the business owners could handle.

Cashflow dried up and debts, including unpaid super contributions, started piling.

Between 2014 and 2015, Mr Christodoulou says he applied for small business and personal loans to pay workers' superannuation guarantee charge liabilities and other debts owed.

By 2016, things had got so dire that Kudos called in administrators Mackay Goodwin to take over running of the business.

Mr Christodoulou says in late 2015, due to ill health, he stepped away from managing the company.

He adds that, as far as he knew, money owed to workers would be dealt with by the administrators as part of the voluntary administration process, where a Deed of Company Arrangement (DOCA) was entered.

A DOCA is effectively an agreement between a company and its creditors which sets out how the affairs and assets of the company will be dealt with.

Mr Christodoulou says he resigned as director of the company in July 2016 (although he remained an employee) due to ongoing stress-related health issues as well as anxiety and depression.

In October 2016 his sister became the sole director of the company, and met with Grahame Ward of Mackay Goodwin to place the company into voluntary administration.

His sister was put into bankruptcy when the company was wound up.

A 'downward spiral'

At that time the administrators calculated that the company owed more than $2 million to unsecured creditors, such as suppliers and customers.

Initial administrator reports put the superannuation owed at $137,769, but this figure was in subsequent reports altered down to $77,335.

By the end of the administration process, Mackay Goodwin was paid $449,844.

This comprised $319,735 during the DOCA and $130,109 during the liquidation.

This was higher than its initial estimates of the cost of the administration and ate into the funds available to distribute to other creditors.

"Creditors can refine debt throughout an appointment which can alter the final amount payable," Mackay Goodwin director and liquidator Grahame Ward told ABC News.

"All employee entitlements, including superannuation accrued during the administration period, were paid, in accordance with our obligations as administrator."

He said administrator fees increased significantly from the initial estimate, because that "the administration was more complex than expected involving the ongoing trading of the company leading into a Deed of Company Arrangement with variations and then a liquidation".

"While we were the administrators, all super accrued during the term of our appointment was paid in accordance with our responsibilities," Mr Ward said.

He said the company "was unable to meet its superannuation and other debts accrued up to the date of appointment of the administrators".

"The directors put forward a proposal for the company to enter a Deed of Company Arrangement, which ultimately failed after many months of trading," Mr Ward said.

"The business was however unsellable, and the company was liquidated.

"The matter was finalised in 2022."

Mr Christodoulou admits that back then mistakes were made in running the business and says, during that stressful time, he also started making bad health choices.

"You know, we choose the wrong food, we choose the wrong drink, and before you know it, you've put yourself into this spiral of unhealthy living," he says.

"It's just a downward spiral. And then you become incapable of running businesses properly."

Mr Christodoulou says it's near impossible to source records dating back more than a decade for a company that has been wound up, but that he kept some old paper pay slips in his garage.

He says, based on these records, his accountant thinks that in the worst-case scenario it may be possible the company may have owed about $40,000 for the periods of 2013 and 2014.

Tens of thousands of DPNs issued

The risk of directors being personally bankrupt if they don't pay workers' superannuation is one that the government has been warning of for some time now.

Not only were laws passed by the Gillard Labor government in 2012 to make directors personally liable for super debts, but Assistant Treasurer Stephen Jones has reiterated his view that unpaid superannuation is akin to 'wage theft' and the government will be cracking down on it.

According to ATO data obtained by ABC News, between July 1, 2023, and February 29, 2024, 13,454 DPN's were issued, and 2,881 garnishee notices were issued.

The DPN numbers are already tracking well above previous years, with 2022-2023 the year when activity began ramping up.

The ATO says "firmer debt collection actions" are needed because the agency "is committed to ensuring businesses that do not comply with their obligations aren't getting an unfair competitive advantage".

"The ATO prefers to work with taxpayers to resolve their situation through engagement rather than enforcement," an ATO spokeswoman told ABC News.

"But it is also the ATO's responsibility to ensure a level playing field, protecting other creditors, and supporting those who are doing the right thing."

However, financial counsellors worry that this sudden ramp up in activity is causing severe emotional and financial stress.

ATO debt recovery action 'leading cause' of SME financial stress

Phone calls to the National Small Business Debt Helpline have hit their highest on record, with ATO debt recovery action now being the leading cause of financial stress.

"It is the busiest we've ever been," says Anna Dooland, a financial counsellor at the Small Business Debt Helpline.

Over the past financial year there have been more than 4,000 calls to the National Small Business Debt Helpline, many on the verge of seeing their businesses collapse, and others being forced to shut shop because they can't afford to pay the tax office as fast as it's demanding.

"The phone is running hot - when we finish a call, there's another call waiting and everyone we speak to everyone is so stressed and so distressed, and many people are crying - they just they don't know what to do," Ms Dooland says.

"We're in a cost-of-living crisis, and I think all of those things together with the ATO's firmer action approach is seeing some businesses really feel the pinch."

Over May and June calls to the helpline hit unprecedented levels. In June there were 427 cases of small businesses calling in despair - the second highest in the Helpline's history.

May, which was a longer month, saw 484 reports, the highest in the Helpline's history.

On average there were 21.4 average cases being reported per business day, a 60 per cent increase compared with June 2023.

Ms Dooland says many of those being issued with DPNs are vulnerable people already in stress.

"There's been a break-up, they may still be impacted by a natural disaster, a flood or a fire, maybe their premises is still damaged and they're still going through the process of fixing this and now they have an additional thing to consider," she explains.

The personal effect of the DPN is that a director's family home and personal assets are at risk.

"That's a very frightening thing to consider when you only have 21 days to decide what to do," Ms Dooland says.

"If people do decide to liquidate their company, then they're in a situation where they've lost their business, perhaps they're putting employees out of work, and that will affect their family.

"Or if they decide to do nothing, they're actually accepting the debt as their own, and that can put their own family and their own house at risk."

Insolvencies track GFC levels

Jarvis Archer is a liquidator and says the rate of insolvencies is now tracking around peaks seen just after the global financial crisis.

"It's the highest number of insolvencies I've seen, and it's the busiest I've been in my 22-year career in insolvency," Mr Archer says.

"That's really been driven by that significant ATO debt that has been collected by the ATO with director penalty notices and wind-up notices.

"The director penalty notice has been the most used tool of the ATO since they've started their pandemic debt recovery clean-up."

In the 12 months to the end of May, company insolvencies totalled 10,774, up 36 per cent on pre-pandemic levels and exceeding the post-GFC peak of 10,757 in the 2012 financial year.

This is an average of 897 companies entering insolvency per month compared to just 661 per month pre-pandemic.

Although official ASIC numbers for June are not yet finalised, Mr Archer says preliminary numbers from available sources indicate total company insolvencies for June 2024 were 1,050, bringing the total for FY24 to over 11,040.

He says that means the rate of company insolvencies was 39 per cent higher than both FY23 and the pre-pandemic average.

Last financial year also eclipsed the previous record of annual company insolvencies, being 10,757 in FY2012 during fallout from the global financial crisis.

Mr Archer says DPNs "can come at any time and catch people off guard".

"Why that's such a significant impact for the director is that while they're dealing with the debt, trying to get their business back on track, they get this notice that gives them three weeks to sort out years of financial difficulty ," Mr Archer says.

"That then forces them to have to pay that debt, personally risking their home and personal bankruptcy."

He says many don't even know a DPN exists until years later.

"They (the DPNs) just go to the directors' personal address registered with ASIC, there's no copy of the letter sent to the accountant or to the company. And so, if the director misses that letter, there's nothing they can do. It's not a defence."

Call for the ATO to use 'greater discretion'

Ms Dooland says the Debt Helpline is also seeing increased use of garnishee notices allowing the ATO to take money directly from people's bank accounts.

She believes the ATO is being very aggressive and needs to give people more time to pay tax debts.

"Having gone from being so lenient to so quickly being having a firmer approach, especially in a time when there is a cost-of-living crisis, I think it's too soon," Ms Dooland says.

Ann Kayis-Kumar is the founding director of UNSW Tax and Business Advisory Clinic, which is also seeing more small businesses owners approach them for help on tax debts.

She says most of their clients are referred on from financial counsellors, community centres, and domestic violence support and lifeline support groups.

The average tax debt of clients that come to them is $90,000, but then that's on top of their other debts.

"DPNs are a method that they have been using, and they have issued tens of thousands of them," she says.

"Now, in many cases, that is entirely fair, and it's a very effective tool to quickly collect on debts.

"The challenge is when people who are really doing it tough get swept up in this, and there's no safety mechanism that is readily available to the ATO at its disposal to support these people."

She says it is "particularly problematic" in cases where they don't even know that they were director of that company.

"Where, for example, their abusive ex-partner has made them a director, the first time they find out that they're a director of this company for which they're going to be personally liable is when they receive that letter," she says.

Ms Kayis-Kumar says they would like to see law changes that would allow defences to a DPN being on grounds of coercive control in domestic violence cases.

She wants increased discretion for the commissioner to waive debts where people are in "financially vulnerable situations, or victims' survivors of financial abuse".

The ATO says "help and support remains available for those businesses who genuinely need it, and who engage with us early", including more time to pay through a payment arrangement, or remission of penalties and general interest charges where there are "circumstances beyond the taxpayer's control".

It says that, in certain circumstances, directors may have a valid defence that would remove their director penalty debt.

"These [removal of a DPN] are generally available for people who, for good reason, did not ever take any part in managing the company," the ATO spokeswoman said.

"Remission of the director penalty debt may also be available if the director takes certain steps within 21 days."

'No open channel for communication'

As it stands, Mr Christodoulou says his 16-year-old daughter has got more money in her bank account than he has.

He is currently working as an employee for a private company and says when he gets his personal tax refund the ATO automatically take the money out of that.

"I've also been paying $100 a month towards it as well, just so it doesn't grow any more while we try and sort this out," he says.

"But therein lies the problem. There is no open channel for communication, and there's no way of knowing how to communicate with anybody at the ATO."

He says the stress of the situation has led to him contemplating self-harm.

"I wasn't one of those business owners that Phoenixed my company, I had the business in my own name, I took full responsibility for running my company. I did everything by the book," he says.

"You're allowed to make mistakes, and you're allowed to be held accountable for those mistakes, but not 11 years down the track.

"There should be a process in place to stop the ATO from bullying people, from scaremongering people and from going after them essentially without anything holding them back."

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The ATO is cracking down on former company directors in a blitz some say will send them bankrupt

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The ATO has issued tens of thousands of director penalty notices that make people personally liable for debts, and is also more commonly using garnishee notices, which allow it to take money directly from a person's bank account or employer. That's sending more businesses under.

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Phoenixing - Example: Cycle ends in jail time for illegal phoenix operators

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Phoenixing - Example: Cycle ends in jail time for illegal phoenix operators

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Context:

The companies set up by the three men failed to remit both Goods and Services Tax (GST) and Pay as You Go (PAYG) withholding to the ATO, despite charging their clients GST and including figures supposedly withheld for PAYG on employee payslips. Significant debts for the entities were raised following audits, however, because the men were withdrawing funds from the respective entities’ accounts on a frequent basis, there were insufficient funds at the time of liquidation to enable the recovery of the outstanding tax debts. Over a 25-month period, across all six entities, $23,131,414 was withdrawn in cash by the offenders.

In some instances, there was some overlap in the operation of the entities, but in most cases, they would cease operating an entity and move on to another, beginning the cycle again.

Who were the victims of the crime:

1. Company employees and their families/dependents as they were charged on their payslips

2. Company customers (paid GST)

3. The economy/Australian community/International community

4. Regulators (ATO/Commonwealth)

5. Market competitors

6. Supply chain - contractors, suppliers, etc.

What was the impact of the crime in terms of monetary losses?

1. Defraud of $4,632,355

2. Withdrawn $23,131,414 as cash by offenders

What non-monetary losses did you identify?

1. Losses to the community - less/lack of funding to critical/essential sectors in the community such as health/education/transport

2. Loss of jobs/stability for employees and an impact on their quality of life from the changes and lack of justice/protection

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Three men have today been sentenced to jail for conspiring to defraud the Commonwealth of $4,632,355, following the orchestration of an elaborate illegal phoenix operation. Seng Leng Heng, was sentenced to 8 years' imprisonment as the 'instigator and architect of the scheme'. Nathan Sarinn, and Nay Chy were sentenced to 4 and 5 years' imprisonment respectively for their roles in the scheme. A reparation order was also imposed requiring the trio to pay back the full amount.

Mr Heng, Mr Sarinn, and Mr Chy established multiple labour hire companies to provide workers to vineyards, fruit and vegetable growers, and meat processers around South Australia and in Queensland. The companies failed to remit both Goods and Services Tax (GST) and Pay as You Go (PAYG) withholding to the ATO, despite charging their clients GST and including figures supposedly withheld for PAYG on employee payslips.

Significant debts for the entities were raised following audits, however, because the men were withdrawing funds from the respective entities' accounts on a frequent basis, there were insufficient funds at the time of liquidation to enable the recovery of the outstanding tax debts. Over a 25-month period, across all six entities, $23,131,414 was withdrawn in cash by the offenders.

In some instances, there was some overlap in the operation of the entities, but in most cases, they would cease operating an entity and move on to another, beginning the cycle again.

Assistant Commissioner Ian Read welcomed the sentence handed down today.

"This type of behaviour is blatant fraud against the Commonwealth, and we will not tolerate it. Phoenixing is an intentional act that requires planning and the alleged behaviour in this case demonstrates a deliberate attempt to defraud the tax and super system," Mr Read said.

The trio attempted to hide their illegal activities by appointing shadow directors for the companies, exploiting their relationship with employees or acquaintances living in Australia, at least three of whom were on student visas.

"Today's result demonstrates the ATO's commitment to detecting and prosecuting tax crimes. We take our responsibility to protect the tax and super systems seriously," Mr Read said.

The ATO-led Phoenix Taskforce takes a whole-of-government approach to combating illegal phoenix activity. Established in 2014, the taskforce includes 38 other Federal, State and Territory government agencies, including the Australian Securities and Investments Commission, Attorney-General's Department, the Fair Work Ombudsman and Australian Border Force.

Chair of the Phoenix Taskforce Will Day said illegal phoenix activity is an economy-wide issue that costs the Australian community billions of dollars every year, impacting businesses, employees and government.

"Tax crime is not victimless. Illegal phoenix operators gain an unfair advantage by never intending to meet their financial or tax obligations, not only disadvantaging honest businesses, but the whole Australian community who do the right thing.

"The taskforce aims to disrupt the business model of phoenix operators, bring them back into the system, or remove them from the business environment and penalise them, Mr Day said.

"The ATO's ability to identify and quickly crack down on this type of phoenix activity will be dramatically enhanced by the introduction of Director Identification Numbers, which will be required for all new directors from 1 November," Mr Day said.

Illegal phoenix activity occurs when a new company is created to continue the business of a company that has been deliberately liquidated to avoid paying its debts, including taxes, creditors and employee entitlements. This behaviour can be repeated many times. Since the taskforce was established in 2014 to 30 June 2021, the ATO has raised more than $1.54 billion in liabilities from audits and reviews of illegal phoenix activities. It's also returned more than $687 million to the community.

If you know or suspect illegal phoenix activity, report it to us by:

For more information on how to recognise a dodgy scheme visit www.ato.gov.au/phoenix

This matter was prosecuted by the Commonwealth Director of Public Prosecutions.

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Cycle ends in jail time for illegal phoenix operators

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Three men have today been sentenced to jail for conspiring to defraud the Commonwealth $4,632,355 following the orchestration of an elaborate illegal phoenix operation.

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1.       Who were the victims of the crime?

a.       Employees of the company; other businesses competing with the phoenixed company; credits of the business (typically in the form of suppliers or sub-contractors employed by the business); the community, which misses out on revenue that could have contributed to community services, particularly in the form of taxation revenue.

2.       What was the impact of the crime in terms of monetary losses?

a.       Estimated to be between $2.85 and $5.13 billion per year. This is comprised of unpaid trade creditor costs between $1,162 million and $3,171 million; $31 million - $298 million in unpaid entitlements to employees; and costs to government from unpaid taxes and compliance costs of around $1,160 million.

3.       What non-monetary losses did you identify?

a.       Further non-monetary losses can include loss of employment opportunities for employees who lose their jobs as part of the phoenixing operation; loss of confidence from suppliers, employees, and sub-contractors in willingness to do business within that industry; loss of visas where visa holders may no longer be employed by their sponsor company. Creditors and employees may also face significant mental stress as a result of being the victims of phoenixing. Regulatory agencies may also face a loss of confidence where anti-phoenixing laws are not being appropriately prosecuted.

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About illegal phoenix activity
Watch:
Illegal phoenix activity is when a company is liquidated, wound up or abandoned to avoid paying its debts. A new company is then started to continue the same business activities without the debt.

Illegal phoenix activity can occur in any industry or location. However, it is particularly prevalent in the following industries:

property and construction

labour hire

security

regional Australia - mining, agriculture, horticulture, and transport.

Phoenixing causes significant harm to the community because:

Employees miss out on wages, superannuation and entitlements.

Other businesses are put at a competitive disadvantage.

Suppliers or sub-contractors are left unpaid.

The community misses out on revenue that could have contributed to community services.

The economic impact of illegal phoenix activity on business, employees, and government is estimated to be between $2.85 billion and $5.13 billion annually. This amount includes the:

cost to business from unpaid trade creditors: between $1,162 million to $3,171 million

cost to employees through unpaid entitlements: between $31 million to $298 million

cost to government from unpaid taxes and compliance costs: around $1,660 million.

Warning signs of illegal phoenix activity

There are warning signs that indicate when a business may be involved in illegal phoenix activity. See our tips for:

- how to protect your business from phoenix companies

- how to check if the business you work for could be phoenix.

What to look for when running a business

When running your own business you can take steps to protect yourself from other businesses that may be wound up or closed. Look out for any of the following behaviours from a company you are working with:

quotes that are lower than market value

company directors who have been involved with liquidated entities before

requests for payments to a new company

changes to a company's directors and name, while the manager and staff remain the same.

Before you work with another business

Before you work with a business, check them out thoroughly by:

confirming they are registered and their Australian business number (ABN) is valid at ABN LookupExternal Link

searching the ASIC Connect registersExternal Link to check they are

a registered entity

not in liquidation or external administration

asking for references

doing a credit check on them

searching online to see if the company and its directors have any negative media reports

reviewing your terms of trade, such as

asking for upfront payments, cash on delivery or payments in instalments

ensuring you're taking a large enough deposit.

Avoid illegal phoenix advice

If your business is insolvent or struggling to pay its debts, it's important to seek specialist advice from a qualified and registered insolvency practitioner.

Registered liquidators and trustees will provide you with sound legal advice that you can rely on. Be wary of other insolvency advisers who suggest actions designed to help directors avoid paying their creditors.

What to look for if you're an employee or contractor

If you're working for a company, look out for any warning signs that your employer may be involved in illegal phoenix activities, such as:

You don't receive a payslip.

The company ABN and name changes, but the phone number or address stays the same.

Your super or other employment entitlements are not being paid.

Your pay is late, less than what it should be or you are being paid under the minimum wage.

Your payslip records a different employer name to whom you believe you work for.

You can protect yourself by:

Visa holders

If you're working in Australia on a subclass 482 temporary skill shortage (TSS) visaExternal Link or subclass 457 temporary work (skilled) visa, you must be working for your sponsor business.

If you are working for a different business, you may be missing out on employee entitlements or being paid less than the award rate.

See the Fair Work Ombudsman resources to help you check your workplace rights and entitlementsExternal Link .

Report illegal phoenix activity

We're working with other government agencies through the Phoenix Taskforce to stamp out illegal phoenix activity.

You can help us stop illegal phoenix activity by reporting it. If you know of or suspect phoenixing, report it to us by:

We take all reports seriously.

Due to privacy laws, we can't give you any updates or tell you the outcome of the information you provide.

You can also:
Authorised by the Australian Government, Canberra.

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Find out what illegal phoenix activity is, the warning signs, how to protect yourself and how to report a company.

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1. The victims of the crime: employees of the companies, business competitors, suppliers and sub-contractors who are left out-of-pocket.

2. Impact of crime re: monetary losses: cost to business from unpaid trade creditors: between $1,162 million to $3,171 million, cost to employees through unpaid entitlements: between $31 million to $298 million, cost to government from unpaid taxes and compliance costs: around $1,660 million.

3. Impact of crime re: non-monetary losses: the noncontribution of revenue towards progressing local communities, the overall wellbeing of stakeholders involved in scheme.

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Three men have today been sentenced to jail for conspiring to defraud the Commonwealth of $4,632,355, following the orchestration of an elaborate illegal phoenix operation. Seng Leng Heng, was sentenced to 8 years' imprisonment as the 'instigator and architect of the scheme'. Nathan Sarinn, and Nay Chy were sentenced to 4 and 5 years' imprisonment respectively for their roles in the scheme. A reparation order was also imposed requiring the trio to pay back the full amount.

Mr Heng, Mr Sarinn, and Mr Chy established multiple labour hire companies to provide workers to vineyards, fruit and vegetable growers, and meat processers around South Australia and in Queensland. The companies failed to remit both Goods and Services Tax (GST) and Pay as You Go (PAYG) withholding to the ATO, despite charging their clients GST and including figures supposedly withheld for PAYG on employee payslips.

Significant debts for the entities were raised following audits, however, because the men were withdrawing funds from the respective entities' accounts on a frequent basis, there were insufficient funds at the time of liquidation to enable the recovery of the outstanding tax debts. Over a 25-month period, across all six entities, $23,131,414 was withdrawn in cash by the offenders.

In some instances, there was some overlap in the operation of the entities, but in most cases, they would cease operating an entity and move on to another, beginning the cycle again.

Assistant Commissioner Ian Read welcomed the sentence handed down today.

"This type of behaviour is blatant fraud against the Commonwealth, and we will not tolerate it. Phoenixing is an intentional act that requires planning and the alleged behaviour in this case demonstrates a deliberate attempt to defraud the tax and super system," Mr Read said.

The trio attempted to hide their illegal activities by appointing shadow directors for the companies, exploiting their relationship with employees or acquaintances living in Australia, at least three of whom were on student visas.

"Today's result demonstrates the ATO's commitment to detecting and prosecuting tax crimes. We take our responsibility to protect the tax and super systems seriously," Mr Read said.

The ATO-led Phoenix Taskforce takes a whole-of-government approach to combating illegal phoenix activity. Established in 2014, the taskforce includes 38 other Federal, State and Territory government agencies, including the Australian Securities and Investments Commission, Attorney-General's Department, the Fair Work Ombudsman and Australian Border Force.

Chair of the Phoenix Taskforce Will Day said illegal phoenix activity is an economy-wide issue that costs the Australian community billions of dollars every year, impacting businesses, employees and government.

"Tax crime is not victimless. Illegal phoenix operators gain an unfair advantage by never intending to meet their financial or tax obligations, not only disadvantaging honest businesses, but the whole Australian community who do the right thing.

"The taskforce aims to disrupt the business model of phoenix operators, bring them back into the system, or remove them from the business environment and penalise them, Mr Day said.

"The ATO's ability to identify and quickly crack down on this type of phoenix activity will be dramatically enhanced by the introduction of Director Identification Numbers, which will be required for all new directors from 1 November," Mr Day said.

Illegal phoenix activity occurs when a new company is created to continue the business of a company that has been deliberately liquidated to avoid paying its debts, including taxes, creditors and employee entitlements. This behaviour can be repeated many times. Since the taskforce was established in 2014 to 30 June 2021, the ATO has raised more than $1.54 billion in liabilities from audits and reviews of illegal phoenix activities. It's also returned more than $687 million to the community.

If you know or suspect illegal phoenix activity, report it to us by:

For more information on how to recognise a dodgy scheme visit www.ato.gov.au/phoenix

This matter was prosecuted by the Commonwealth Director of Public Prosecutions.

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Cycle ends in jail time for illegal phoenix operators

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Three men have today been sentenced to jail for conspiring to defraud the Commonwealth $4,632,355 following the orchestration of an elaborate illegal phoenix operation.

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Who are the victims of the crime?

1. Drug users and the community

2. Pressure on the health system

3. Desperate users recruited to be drug mules

4. family members

What was the impact of the crime in terms of monetary losses?

1. drug treatment and drug related medical interventions

2. huge impact on the health system

3. expense to the tax payer in directing funding toward the war on drugs

What non-monetary losses did you identify?

1. excessive levels of imprisonment and overburdened judicial and penal systems

2. environmental impact of the cultivation of certain flora responsible for the manufacture of drugs

3. Mental health of users and their families as well as the impact trafficking on families

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[Counterfeit Goods] Europe’s Counterfeit Capital

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[Counterfeit Goods] Europe’s Counterfeit Capital

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1.       Who were the victims of the crime?

The consumers who believe that they are getting a good deal on a real luxury brand item.

The workers who are being exploited by working sewing machines all night, possibly without a break.

The original luxury brands are affected by loss of customers, decline in sales and the theft of intellectual property. The quality and reliability are also affected by customers who review the counterfeit goods, believing it to belong to a real brand.

The government is affected by loss of tax revenues (incl. GST) from the authentic luxury brands due to sales decline. Also, lack of tax revenues from the fake brands because they run an underground market.

The organisations who let the fake brands rent the warehouses or stores are affected because these brands are move quickly and once they are captured, their accounts are frozen, and the owner of the warehouse suffers a loss.

2.       What was the impacts of the crime in terms of monetary losses?

In 2020, there were approximately $76 billion sold in fashion counterfeit goods. In one case, one row of shops sold $700 million of counterfeit goods in a single year. In another case, counterfeit stock was confiscated, amounting to $4.8 million.

In 2023, counterfeit goods sale have tripled to approximately $7 trillion/ year, with a primary focus on fashion goods.

3.       What non-monetary loses did you identify?

The impact on authentic businesses, who had their intellectual property, reputation and customers stolen.

Consumers’ lack of trust in the future.

Loss of money being funnelled into the economy to sustain government buildings.

In most cases, counterfeiting businesses are connected to a criminal organisation that funnels money from counterfeit goods into doing other crimes, especially terrorism financing.

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It’s ‘one of the most lucrative crimes’ going, and it’s right in front of your eyes

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It’s never been easier to buy convincing fake luxury fashion online. But many buyers would be shocked to learn where their money goes.

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Moonlighting refers to a second job in addition to an individual’s regular employment. It can come in many forms, but usually becomes an issue if your employee has not disclosed their additional employment or it poses a conflict of interest for your business.

Undercover officer was found negotiating with criminals about washing dirty money by converting Australian dollars into cryptocurrency via Bitcoin in WA.

1.Who were the victims of the crime?

Defraud the Commonwealth and abuse of public office.

2.What was the impact of the crime in terms of monetary losses?

The public officer conspired to direct information technology contracts through preferred suppliers leading them to receive financial benefits. The public is entitled to have confidence in the integrity of their public officials, and to know that an Australian Public Service (APS) employee's personal interests do not conflict with his or her public duties. The APS Code of Conduct (the Code) requires employees to take reasonable steps to avoid any conflict of interest, real or apparent, in connection with their employment.

3.What non-monetary losses did you identify?

The acceptance of a gift or benefit that is connected with an employee's employment can create a real or apparent conflict of interest that should be avoided. At the extreme, it could be perceived as a bribe. Accepting a bribe is an offence under the Commonwealth Criminal Code Act 1995- external site (the Criminal Code) and a breach of the Code of Conduct. Since the converted AUD into crypto bitcoin while holding public office, it can also be considered an act of insider trading.

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A public servant moonlighting as a "runner" for a WA crime syndicate - which was laundering money in a sophisticated scheme involving tokens and cryptocurrency - has been jailed for three years after he was caught delivering half-a-million dollars to a western suburbs apartment.

Marko Knezevic, 32, was netted as part of a secret police operation that saw an undercover officer negotiating with criminals about washing dirty money by converting Australian dollars into cryptocurrency via Bitcoin last year.

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WA man caught delivering $500K for crime syndicate jailed

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A public servant moonlighting as a 'runner' for a WA crime syndicate has been jailed for three years after he was caught delivering half-a-million dollars to a western suburbs apartment.

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Zheming Zhang granted bail in Canberra court after allegedly impersonating a Chinese police officer in virtual kidnapping scam

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Zheming Zhang granted bail in Canberra court after allegedly impersonating a Chinese police officer in virtual kidnapping scam

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1. International students studying in Australia.

2. Impersonation a Chinese police officer to extract $400,000 from an international student in Canberra.

3. Students fear + threats of deportation due to failure to pay for the scam, stress and impact on their studies and perception of safety in Australia

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In short: 22-year-old Zheming Zhang has been granted conditional bail after pleading not guilty to virtual kidnapping charges in the ACT Magistrates Court.

Mr Zhang is charged with four offences after allegedly impersonating a Chinese police officer to extract $400,000 from an international student in Canberra.

What's next? He is set to reappear in court in July.

A 22-year-old man has been granted conditional bail in the ACT Magistrates Court after allegedly impersonating a Chinese police officer in a virtual kidnapping scam that garnered about $400,000 from a Canberra victim.

Court documents state that last August Zheming Zhang called the alleged victim - an international student from China living in Canberra - claiming to be her phone service provider.

She was allegedly told her account would be restricted due to suspected scam activity from her number.

In her attempts to dispute this, the victim was allegedly transferred to speak to a person who claimed to be from the Shanghai police - and followed up with her several times to investigate the suspected activity.

Police say she was pressured not to tell anyone about their communication and was eventually convinced to check into a hotel room in Belconnen - where the man attended and claimed to place her under arrest.

According to court documents, while still in the hotel room the victim made bank transfers totalling about $400,000 to overseas accounts in what she believed to be bail payments.

She was also allegedly told she would need to leave her university and would be sent back to China, and provided documentation that included a confidentiality agreement and an extradition warrant to support this.

Police acquired CCTV footage from the hotel and identified the man as Mr Zhang.

Earlier this month, he was arrested after police tracked him to an address in Queensland.

Mr Zhang faces four charges, including forcible confinement, representing himself as a police officer, kidnapping and obtaining financial advantage by deception.

In the ACT Magistrates Court on Friday he appeared via video link and pleaded not guilty to the charges.

He was joined by his mother, who travelled from China to Australia after the charges were laid to support her son emotionally and financially, the court heard.

Prosecutor Christina Muthurajah said the evidence suggested Mr Zhang may be part of a larger criminal network.

She told the court she believed the network was "sophisticated", involving multiple victims and "exorbitant" amounts of money - presuming that he has access and money through an international scam syndicate.

She also noted that Mr Zhang was facing "strikingly" similar offences in other states.

"These victims were vulnerable, and some did not report to police," Ms Muthurajah said.

The court also heard the man did not have a criminal history, and that he may have been "pressured" to commit these offences.

"He appears to have been something of a victim in the process himself," Chief Magistrate Lorraine Walker said.

Mr Zhang was granted bail with conditions, including that he remain living at his university residence in Queensland, and does not leave the country or approach the victim, including by electronic means.

He is set to reappear in court in July.

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Man pleads not guilty to impersonating Chinese police officer after allegedly extracting $400,000 from international student in Canberra

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Zheming Zhang was granted conditional bail in the ACT Magistrates Court after his arrest last week.

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Who were the victims of the crime?

-British Columbia and it's residents were the ultimate victims of the crime, due to the nature of PMLO's, the source of funds is unclear.

What was the impact of the crime in terms of monetary losses?

-For BC alone, a conservative estimate places the value of money laundered in 2018 was CAD$7.4 Billion, CAD$5 Billion being via Real Estate.

What non-monetary losses did you identify?

-BC estimates that due to this ML activity in 2018, house prices in BC were inflated by 5%, further adding to the housing affordability crisis.

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The Expert Panel on Money Laundering was appointed by the Minister of Finance in September 2018 to review money laundering in the real estate sector after two independent reports revealed that B.C.'s real estate market is vulnerable to criminal activity and market manipulation. The panel's final report (PDF, 4.7MB) was released in May 2019.

In their review of the sector, the Expert Panel estimated that more than $7 billion in dirty money was laundered in B.C. in 2018, and between $800 million and $5.3 billion was laundered through the real estate market, raising housing prices by an estimated 5%.

The Expert Panel consisted of chair Maureen Maloney, Tsur Somerville and Brigitte Unger, who are leading experts in their respective fields of policy, real estate economics and money laundering. They were tasked with presenting recommendations for change to prevent and deter money laundering in the future.

The Expert Panel was asked to:

Consider B.C.'s existing legislative framework and financial oversight:

Identify gaps in the B.C. legislation with respect to the impact of foreign investment and money-laundering in B.C. real estate

Review the compliance regime, with a focus on integrity of the system and public confidence

Evaluate work underway or completed by the provincial government that may address some of these systemic challenges

Review best practices adopted by other jurisdictions

Provide recommendations on:

Prevention of market manipulation and abuse

Monitoring and reporting on activities of real estate market and regulators

Aligning federal policy and enforcement with B.C.'s regime

Improving standards in financial services

Read the Expert Panel's final report on combatting money laundering (PDF, 4.7MB).

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Combatting Money Laundering in B.C. Real Estate

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The Expert Panel on Money Laundering was appointed by the Minister of Finance in September 2018 to review money laundering in the real estate sector after two independent reports revealed that B.C.'s real estate market is vulnerable to criminal activity and market manipulation. The panel's final report (PDF, 4.7MB) was released in May 2019.

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(1) Who were the victims of the fraud?

Immigrants who are looped into this fraud, insurance companies, and people in the community adversely impacted from the crashes.

(2) What was the impact of the crime in terms of monetary losses?

Estimated to be about $150m a year relating to fraudulent claims.

(3) What non-monetary losses did you identify?

Adverse impact to people in the community from the crashes, inefficient use of resources for various parties eg. insurance companies, community, councils to clean up crash sites, and resolving claims. Potentially higher premium for innocent insured people

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New immigrants to New Zealand are participating in motor vehicle insurance frauds worth millions of dollars, the Insurance Council claimed today.

Investigators are looking at three single fraud cases worth about $500,000 each, but in total the fraud is worth tens of millions, council chief executive Chris Ryan told NZPA.

Fraudulent schemes allegedly headed by new immigrants involved deliberately arranging motor vehicle crashes and then claiming for insured losses, and buying cheap quality cars -- usually already damaged -- and then having them intentionally stolen or crashed, the council said.

Mr Ryan claimed the frauds involved people who came from parts of the world where organised deception seemed far more prevalent than it is in New Zealand.

Mr Ryan said that other New Zealand citizens were also involved in frauds, which are costing insured New Zealanders millions of dollars a year. But he added: "What we are finding increasingly is that in the areas of organised fraud against insurance companies there is a disproportionately high percentage of new immigrants (involved)."

The insurance industry paid out $670 million in claims each year for cars, of which Mr Ryan said he believed $150 million was in fraudulent claims.

He said fraud was most common among new immigrants who came from a family group with a very strong male figure.

"That male figure has been put in a new community and lost some of the status they had in a previous community. They are approached by criminals who are expert defrauders -- and usually internationally -- and say we can provide additional income for you if you act as part of this fraud."

He said they were usually "good people", but were drawn into the fraud culture through their "loss of status".

Mr Ryan said he hoped those in the traditional system of insurance -- "which is in the European based communities" -- can educate people from new immigrant nations to understand "insurance is about utmost good faith".

"You need to be able to say to your insurance company 'I will tell you the truth' and in return get the payouts they are due."

- NZPA

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Immigrants guilty of vehicle insurance fraud, says council - NZ Herald

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