ATO scam: ‘That looks so f***ing bad’ — Tax boss’ daughter recorded on phone taps

EXCLUSIVE: DEPUTY tax commissioner’s daughter allegedly discussed how to keep money flowing through a widespread alleged fraud operation.

• ATO BOSS IN ALLEGED PHONECALL TO SON
• A MONEY TRAIL THAT SIMPLY DEFIES BELIEF

A DEPUTY tax commissioner’s daughter allegedly said “that looks so f … ing bad” as she discussed how to keep money flowing through what is alleged to be one of the nation’s most lucrative fraud operations.

Lauren Cranston and her friend Devyn Hammond are accused of account keeping for the alleged $165 million Plutus Payroll crime syndicate.

Australian Federal Police claim the women managed a critical aim of the scheme, in paying no more than 60 per cent of the required income tax to the Australian Taxation Office, where Cranston’s father­ Michael Cranston was a deputy commissioner.

Lauren Cranston leaving her Picton home yesterday. Picture: Stephen Cooper

On January 4, in a conversation recorded by police, Lauren Cranston allegedly told Hammond she was going to “drop the tax back to 60 per cent and not do 70 per cent any more”.

The two were arrested along with Lauren’s brother Adam Cranston and four other alleged conspirators last week and charged with conspiring to defraud the Commonwealth.

Michael Cranston was given a court attendance notice to face a charge of abusing his position as a public official. He is not accused­ of being involved in the alleged conspiracy.

ATO deputy commissioner Michael Cranston allegedly told his son “it stinks of you’re in a phoenix operation”.

Adam Cranston, pictured walking in Bondi while on bail yesterday, is alleged to have been a major player in a $165 million payroll tax scam. Picture: Toby Zerna

The two women were also allegedly recorded complaining about other syndicate members.

“(If) I go away you cover my arse, it’s the same f ... ing principle for all of us,” Lauren­ Cranston allegedly said, to which Hammond responded: “Except we’re the only ones that hold that f … ing principle in place.”

The pair allegedly paid millions of dollars from the accounts of Plutus Payroll to “second tier” companies, where tax was allegedly withheld and the sums recorded­ on detailed spreadsheets.

When the ATO or “straw directors”, who were paid a token fee to have the companies opened in their names, decided to take control­ of accounts, it allegedly caused headaches.

“We can’t have A2 paying A1, and the A1 paying A2, that looks so f … ing bad,” Lauren Cranston allegedly­ told Hammond in December. Police also allegedly­ recorded Hammond saying she wanted to “burn” her computer.

Lauren Cranston and her friend Devyn Hammond are accused of account keeping for the alleged $165 million Plutus Payroll crime syndicate. Picture: Stephen Cooper

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