ATO-led taskforce issues identikit of top criminal personas to catch them out

Now the ATO-led Australia’s Serious Financial Crime Taskforce (SFCT) has just launched the images that describe the typical characters and behaviours seen among the top type of serious criminal offenders.

The personas range from hardcore criminals connected to international crime syndicates, through to professional operators who use their skills and networks to facilitate financial crime. There is also the cyber criminals, launderers, fixers, tax frauds and rorters.

Criminal ‘personas’ outlined in the Serious Financial Crime Identikit include:

• The Hardcore Criminal: the key instigator, overseer and beneficiary of the most serious financial crimes. Often, these individuals are members of or linked to organised (international) crime syndicates or groups.
• The Lieutenant: the person on the ground who works for hardcore criminals to source and manage the different resources and enablers they need. They will typically not be aware of the full extent of the crimes that ‘their employer’ is involved in. They will only know about their piece of the puzzle.
• The Enabler: enablers are professionals who use their skills, structures and networks to help facilitate serious financial crime.
• The Tax Fraud: an opportunist who takes advantage of situations as they arise, works with professional ‘enablers’ to conduct and conceal their crimes and tries to bluff their way around the system.
• The Cyber Criminal: these criminals use technology to gain access to information and sensitive data which can be used to facilitate a range of crimes, including tax crime and identity theft.
• The Fixer: a person who profits by facilitating offshore tax evasion. More specifically, they help individuals, dodgy companies and criminal syndicates conceal the source of money and how much money they have.
• The Phoenix Operator: someone who deliberately winds up or abandons a company (typically within a year) leaving its debts behind and no one to chase. They may then start another company up immediately to take over where the ‘failed’ company left off, or else they often flee the country.
• The Straw Director: the director of a company/companies destined to be liquidated within a short period of, or a shell company that has been set up with the intention of avoiding tax and other liabilities. However, in some cases, straw directors are not complicit in serious financial crimes, instead they are best described as ‘victims’.
• The Rorter: an individual who lies or withholds information to fraudulently access a range of government subsidies (including COVID-19 stimulus measures).
• The Launderer: sets up companies and money flow structures that make illegally gained proceeds (dirty money) appear legal (clean).

The Taskforce is made up of experts from a range of federal agencies (including the AFP and Australian Border Force), and together have launched The Serious Financial Crime Identikit to help stop financial crime and assist the public to know how to spot them and what to do if suspicious behaviour is noticed.

Emerging trends and areas of concern for serious financial crime including, offshore tax evasion, cybercrime and identity theft, illegal phoenix activity and crime related to the COVID stimulus measures.

SFCT Chief Day said there are too many innocent victims, and criminal activity needs to stop.

“Direct victims of serious financial crime include people who have had their life savings targeted or identities stolen, through to people and businesses that are not paid for services provided to a company they thought was legitimate,” said Mr Day.

“Meanwhile every one of us is a victim too because of the millions of dollars that doesn’t go into our tax system for essential services such as education and health.”.

The identikit also includes a checklist of warnings signs, such as spotting someone with a fancy lifestyle beyond someone’s day job, making large cash purchases, lying about income or using fake names.

Warning signs outlined in the Serious Financial Crime Identikit include:

In a business and financial context:

• Use of nominees or straw directors
• Keeping two sets of books or financial statements
• Understating income
• Failing to lodge income tax returns or business activity statements (BAS)
• Mischaracterising the true nature of transactions
• Inflating or claiming deductions to which they aren't entitled
• Withholding information from a tax professional or the ATO
• Ignoring legal advice or guidance from the ATO

Personal and purchasing behaviour:

• Concealing money or the source of money
• Unexplained wealth or wealth not commensurate with income
• Suddenly spending more, such as on luxury items or collectibles
• Using fake names
• Providing false or misleading statements
• Making large purchases with cash
• Large cash withdrawals from ATMs
• Heavy gambling
• Aggressive or out of character behaviour may be a sign of stress related to financial crime

Cybercrime and identity theft:

• Unsolicited or suspicious requests for your personal information
• Unusual emails such as password changes or verification links (delete suspicious emails and confirm your details through your own account)
• Suspicious links or downloadable files in emails, text messages or social media posts from sources that don’t appear to be genuine (do not click or download)
• Unusual activity in your accounts (report it straight away)

“The good news is Australia has never been better equipped to catch people who enable and conduct serious financial crimes, and our message for those who evade or cheat the tax system is that they have no place to hide,” Mr Day said.

The SFCT is working with governments and organisations around the world as part of a major crackdown on tax evasion on a global scale.  It is part of a connected network of investigative experts across the world including the Joint Chiefs of Global Tax Enforcement.

Mr Day, who is also the Deputy Commissioner of Integrated Compliance at the Australian Taxation Office, said members of the public can help by using the Serious Financial Crime Identikit, and by calling the ATO tip-off line on 1800 060 062 if they see something suspicious.

Tip-offs can remain anonymous.

The ATO-led SFCT focuses on cybercrime affecting the tax and superannuation systems, offshore tax evasion, illegal phoenix activity and more recently, fraud and crime against the Commonwealth’s Coronavirus Economic Response Package.

Since it was set up in 2015, more than $1 billion in liabilities has been raised as a result of its work, which has included over 1,300 audits and reviews and the conviction of 15 of Australia’s worst financial criminals.