ATO takes part in global action to tackle tax evasion

The action occurred as part of a series of investigations in multiple countries into an international financial institution located in central America, whose products and services are believed to be facilitating money laundering and tax evasion for customers across the globe.

According to the Australian Taxation Office (ATO), it is believed that through this institution a number of clients may be using a sophisticated system to conceal and transfer wealth anonymously to evade their tax obligations and launder the proceeds of crime.

The co-ordinated day of action involved evidence, intelligence and information collection activities such as search warrants, interviews and subpoenas.

The ATO has confirmed that further criminal, civil and regulatory action is likely from these actions in each country.

This is the first major operational activity for the Joint Chiefs of Global Tax Enforcement, known as the J5, formed in mid-2018 to lead the fight against international tax crime and money laundering.

‘First of many’

“This is the first co-ordinated set of enforcement actions undertaken on a global scale by the J5 – the first of many,” said Don Fort, US chief, Internal Revenue Service Criminal Investigation.

“Working with the J5 countries who all have the same goal, we are able to broaden our reach, speed up our investigations and have an exponentially larger impact on global tax administration. Tax cheats in the US and abroad should be on notice that their days of non-compliance are over.”

ATO deputy commissioner and Australia’s J5 chief, Will Day, said that this operation shows that the collaboration between the J5 countries is working.

“Today’s action shows the power of our combined efforts in tackling global tax crime, fraud and evasion,” he said.

The ATO has commenced investigations into Australia-based clients of this institution who are suspected to have undeclared income, with the Australian Criminal Intelligence Commission (ACIC) adopting a supportive intelligence role.

“Never before have criminals been at such risk of being detected as they are now. Our increased collaboration, data analytics and intelligence sharing mean there is no place worldwide you can hide your money to avoid contributing your obligations,” Mr Day said.