A Perth man was sentenced yesterday in the Perth District Court to two years’ imprisonment to be released after serving 12 months, after obtaining almost $110,000 in fraudulent GST refunds contrary to s134.2 of the Criminal Code (Cth). He will be released on a recognisance in the sum of $1000 to be of good behaviour for a period of 18 months in accordance with section 20(1)(b) of the Crimes Act 1914 (Cth) and was ordered to repay the amounts fraudulently obtained.
This is a result of the Australian Taxation Office’s (ATO) extensive efforts under Operation Protego, which was initiated in response to widespread GST fraud activity and includes compliance and debt recovery actions, and criminal investigations, leading to jail sentences for serious offenders.
Deputy Commissioner and Serious Financial Crime Taskforce Chief John Ford said ‘We’ve warned the community that we take attempts at GST fraud seriously. We’ve urged offenders to come forward to the ATO or face severe consequences including imprisonment.’
Justin McCormick had a registered ABN between March 2009 and February 2015, which he re-registered on 11 February 2022 with the intent to lodge business activity statements (BAS) for a business that did not exist and to claim GST on purchases that were never made.
Between February 2022 and March 2022, Mr McCormick lodged two original and three revised BAS via the ATO’s online portal which he accessed through myGov. Mr McCormick’s illegal behaviour ceased after the ATO commenced audits on the BAS lodged for each of the relevant GST reporting periods.
As a result of the false information reported in each BAS, Mr McCormick obtained $109,278 in fraudulent GST refunds, an amount to which he was not entitled.
Mr McCormick was convicted of five offences of dishonestly obtaining a financial advantage by deception from the Commissioner of Taxation.
Mr McCormick was prosecuted by the Commonwealth Director of Public Prosecutions following a referral from the ATO.
Under Operation Protego, the ATO has taken action against more than 56,000 alleged offenders, and those involved in this fraud have already been handed in the order of $300 million in penalties and interest which continues to accrue.
‘We are escalating our efforts to enforce repayment of this fraud. For those people who did receive fraudulent payments, this debt will remain against their account and interest will continue to apply. Some of these fraudsters can expect to be in debt to the ATO for many years to come and any refunds will be offset immediately to repay the debt,’ said Mr Ford.
‘Most Australians believe in a level playing field for businesses, to keep it fair for all. It’s unfair for others to gain a competitive advantage by intentionally doing the wrong thing. This puts pressure on Australians who are doing the right thing and has broader impacts on our community.’
‘Our message is clear, if you don’t run a legitimate business, you do not need an ABN and you cannot claim GST refunds,’ said Mr Ford.
You can anonymously report suspected tax evasion or crime to us by making a tip-off online or call 1800 060 062. For more information about Operation Protego visit ato.gov.au/GSTrefundfraud
Contact details:
(02) 6216 1901