AFP had ATO boss Michael Cranston in sights as they made tax fraud ring swoop
EXCLUSIVE: FEDERAL police were considering serious fraud charges against Australia’s deputy tax boss Michael Cranston when they swooped on 28 properties to crack a $165 million tax fraud ring.
NSW
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FEDERAL cops were considering serious fraud charges against Australia’s deputy tax boss Michael Cranston when they swooped on 28 properties to crack a $165 million tax fraud ring.
A search warrant used in Wednesday’s raids showed investigators were looking for enough evidence to support a “conspire to defraud the Commonwealth” charge for both Australian Taxation Office Deputy Commissioner Michael and his son Adam.
“The AFP always needed to consider whether Michael Cranston was involved in the conspiracy, however subsequent investigation clearly demonstrated he was not involved,” an AFP spokeswoman said yesterday.
“Michael Cranston is not being considered for conspiracy to defraud the commonwealth.”
The search warrant stated the AFP believed there was “reasonable grounds” for suspecting Wednesday’s raids would yield evidence “that between 1 February 2017 and 2 May 2017, Michael Bede Cranston, born 29 May 1959 and Adam Michael Cranston, born 14 January 1987, did conspire to defraud the Commonwealth being the Australian Taxation Office.”
Adam did receive the fraud charge, which carries a possible 10-year prison sentence, after he was cuffed shirtless outside his Bondi home by Australian Federal Police at 6.30am.
His father was given a court attendance notice to face the lesser charge of abusing his position as a public official, punishable by five years jail, on June 13.
AFP allege Michael Cranston tried to access information on an ATO audit into Adam, after his son reached out for help.
Tapped phone calls tendered in court documents, which were revealed on Sunday, allegedly included Michael warning his son “you could be the subject of search warrants”.
Relevant parts of the Commonwealth Criminal Code state an official commits an offence if they exercise the influence of their position with intention of “dishonestly obtaining a benefit for himself or for another person”.
WHITE COLLAR FRAUD CASE IS GETTING MURKIER
The Daily Telegraph can also reveal a text message showing how the 30-year-old Adam tried to distance himself from Plutus Payroll, the company at the centre of the scandal, when the ATO caught a whiff it was owned money.
The ATO froze Plutus’ accounts in April, meaning workers for its clients around the country stopped getting wages.
An online forum lit-up with furious workers, some of which started contacting Adam, the managing director and co-chairman of SYNEP, the company which controlled Plutus.
“I am not sure why you have been given my number,” he texted to one worker who had not been paid for a month.
“I only work for synep and have no involvement in the management of Plutus.
“Plutus is a private equity firm like Macquarie Bank and does no take an active role in the businesses they invest in.
“I have been told by Plutus management team that they are currently working on a solution I apologise for the inconvenience.”
HOW THE ALLEGED SCAM WORKED:
■ Plutus Payroll Australia provided a payroll administration service for a large number of corporate companies.
■ The companies made regular payments to Plutus on the understanding those funds would be used to pay the wages and superannuation of employees and also to pay the ATO their required pay-as-you-go tax.
■ The syndicate allegedly recruited “straw directors” to act as directors of a series of “second tier” or “straw” companies.
■ Plutus allegedly transferred the payroll funds and a percentage of the PAYG tax to the second-tier companies.
■ However not all of the PAYG commitments were paid to the ATO.
■ Instead, police allege remaining funds were transferred to the syndicate members through false invoices and the bank accounts of front companies.
■ The straw companies would keep logs on the differences between what the ATO was paid and what the syndicate took.
■ The scheme allegedly raked in $165 million
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