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Investigation & Fraud News – Week ending 25 August 2023
10 stories this week:
Nuix insider lifts the lid on share market float disaster, as ASIC faces hearings into its role – 21 August 2023
A parliamentary inquiry into the performance of the ASIC, kicks off this week and it promises to be explosive. One of its case studies will be the scandal-ridden tech company Nuix, which torched billions of dollars of shareholder value. A former global vice-president at one of the country’s most disastrous share market floats in years has broken his silence and says he wasn’t surprised when the share price crashed, wiping billions of dollars from the fortunes of investors.
https://www.abc.net.au/news/2023-08-21/asix-nuix-senate-inquiry/102749880
Adam Cranston jailed over $105 million Plutus Payroll tax evasion scheme – 22 August 2023
Adam Cranston, the son of a former Australian Taxation Office (ATO) deputy commissioner, has been jailed for a maximum 15 years over his role in a $105 million tax evasion conspiracy. Between 2014 and 2017, a company called Plutus Payroll collected gross wages from employers, that should have gone to the ATO by way of GST and Pay As You Go (PAYG). They used fake subsidiary companies to carry the tax debt to give Plutus a “clean” appearance.
National Anti-Corruption Commission’s real challenge is leadership. Will it learn the lessons of the Robodebt investigation? – 22 August 2023
Finally a reality, the NACC must now prove its worth. It won’t be a test of design, nor of its powers, but rather a test of leadership. In the first 24 days of operation, the National Anti-Corruption Commission took receipt of almost 500 referrals.
https://www.abc.net.au/news/2023-08-22/national-anti-corruption-commission-robodebt/102749720
Foreign bribery: High Court rejects ‘net benefit’ approach to monetary penalties – 22 August 2023
The maximum monetary penalty for a company which bribed, or conspired to bribe, a foreign public official should not include a deduction for costs incurred in performing the contracts, according to the High Court of Court of Australia following its decision in The King v Jacobs Group (Australia) Pty Ltd [2023] HCA 23, handed down on 2 August 2023. This decision reinforces the significant monetary penalties that may apply to businesses found to have committed a foreign bribery offence.
Operation Elbrus: Trio jailed over tax fraud – 22 August 2023
Three men have been jailed for their roles in a large-scale tax fraud and money laundering syndicate, responsible for defrauding the Australian tax system of more than $105 million over three years. Operation Elbrus revealed that a group of people used payroll services companies to divert pay-as-you-go withholding tax and goods and services tax owed to the Australian Taxation Office.
https://www.miragenews.com/operation-elbrus-trio-jailed-over-tax-fraud-1069535/
Hisense Executive Jailed Over Multi Million Dollar Fraud – 22 August 2023
Aphrodite Myron, a former senior Hisense executive who was accused of stealing $3.4 million over several years to feed her gambling addiction, has been jailed. Hisense ended up paying $3,383,56 into 35 separate bank accounts set up by Myron under her and her family’s names. The call centre boss had falsified documents with payment details linked to bank accounts in her or her family’s name.
Are Aussie banks adequately addressing fraud concerns? – RFI Global – 23 August 2023
RFI’s study reveals that one in five Australians have been victims of banking fraud. Older Australians appear to be especially at risk, with about 63% having encountered communications with scammers. It’s a balancing act for banks as whilst customers demand rigorous security, they also expect a seamless banking journey.
Scammers buying Australians’ personal details on the dark web for as little as $38, research finds – 23 August 2023
The Australian Scam Culture Report by financial services firm BDO reveals 2.7 million people use the dark web each day – and scam-based activity, including accessing credit card, email and social media details, as well as corporate data, accounts for up to 23 per cent of trades over online black marketplaces. Scammers can access Australians’ hacked credit card details for just $38 on the dark web, while unauthorised Facebook and Instagram access are on sale for just over $100.
ICAC granted exemption to use illegally recorded conversations during Toplace investigation – 24 August 2023
An exemption until 2025 has been granted, that will allow the corruption watchdog in New South Wales, to listen to illegally recorded conversations during its investigation into development company Toplace. The attorney-general told NSW parliament the amendment would help ICAC’s statutory functions.
How to blow the whistle on your employer and avoid reprisal – 24 August 2023
The world of whistleblowing is treacherous. People who dob in an employer or the government run the very real risk of losing their job, going bankrupt or going to prison. The Human Rights Law Centre (HRLC) estimate that 80 per cent of whistleblowers in Australia report suffering personal reprisals for speaking up. The Whistleblower Project legal service will help guide people through the process and represent their interests as they attempt to expose misconduct.
Investigation & Fraud News – Week ending 18 August 2023
13 stories this week:
Tax accountant James Redmond Burrows jailed for stealing to fund gambling addiction – 11 August 2023
Tasmanian tax accountant James Redmond Burrows stole money from 25 clients and the ATO by claiming dividends his clients weren’t entitled to, failing to pass on income tax returns, or retaining GST refunds for himself. Burrows will need to serve four years and three months of the sentence term before applying for parole.
FTX founder Sam Bankman-Fried headed for jail after US judge revokes bail – 11 August 2023
A US judge revoked Sam Bankman-Fried’s bail, after finding probable cause that the indicted founder of the bankrupt FTX cryptocurrency exchange tampered with witnesses at least twice. The decision could complicate Bankman-Fried’s efforts to prepare for trial, where the 31-year-old former billionaire faces charges of having stolen billions of dollars in FTX customer funds to plug losses at his Alameda Research hedge fund.
AFL Hawks racism report author facing fraud claim – 11 August 2023
Phil Egan, a former AFL player has faced court accused of defrauding a Victorian Aboriginal service of hundreds of thousands of dollars. Egan faced Melbourne Magistrates Court, charged with 73 offences including obtaining financial advantage by deception from the co-op, and using false documents. It’s alleged he secretly gained $779,000 through 52 supplier invoices paid by Murray Valley Aboriginal Co-operative.
https://au.news.yahoo.com/afl-hawks-racism-report-author-072208760.html
Cops crack alleged bank card fraud plot – 13 August 2023
Five foreign nationals have been charged over an alleged plot to install ATM card skimmers and create fake bank cards to swindle Australians out of their money. They allege the accused installed ATM skimmers to clone a person’s EBT card details and PINs, then at the beginning of each month they would re-encode the cloned bank cards to visit ATMs and withdraw the newly loaded funds. During a search, US authorities found a receipt for a consignment sent to Australia and tipped off the AFP.
https://au.sports.yahoo.com/cops-crack-alleged-bank-card-231900802.html
Australia’s Biggest Tax Fraud Is A $4.6-Billion TikTok-Driven Scheme – 14 August 2023
The Australian Tax Office (ATO) has accused influencers on TikTok of perpetuating the largest tax fraud in Australian history. The ATO has admitted paying out AUD$1.2 billion in fake GST claims, after a viral trend exploded on the platform in mid-2021. The scam involved submitting fake invoices worth up to hundreds of thousands of dollars in a bid to claim back refunds on GST.
https://thedeepdive.ca/australias-biggest-tax-fraud-is-a-4-6-billion-tiktok-driven-scheme/
SkyCity Adelaide Casino sets aside $45m to cover potential penalty, court case continues – 14 August 2023
The Australian Transaction Reports and Analysis Centre (AUSTRAC) launched Federal Court action against SkyCity in December, alleging systemic non-compliance with anti-money laundering and counter terrorism financing laws. AUSTRAC’s court documents stated SkyCity “failed to carry out due diligence on 124 customers” – a breach of laws that could result in fines of more than $2 billion. SkyCity says it has set aside $45 million to cover a potential penalty.
Trump indictment: Second set of charges arising from efforts to overturn the 2020 election results – as it happened – 15 August 2023
Donald Trump has been indicted following a Georgia prosecutor’s investigation into the former US president’s efforts to overturn his 2020 election loss in the state. The former US President insists he will release his own report into the so-called “election fraud” in Georgia.
Gina Rinehart trial shown explosive memo that allegedly tried to cut children’s inheritance – 16 August 2023
A WA court has heard that Gina Rinehart has deliberately deflated the value of mining shares in a family trust to the detriment of her own children’s inheritance. The 1994 memo forms a key part of allegations previously heard in the court that Mrs Rinehart engaged in “fraud” regarding the family trust, which had been created by her late father Lang Hancock. A lawyer for her two eldest children described it as “an egregious breach of duty” and said it was part of a ploy for her to get more Hancock Prospecting shares.
https://www.abc.net.au/news/2023-08-16/gina-rinehart-mining-trial-hope-downs-royalties/102737016
Cory Fleming, friend of murderer Alex Murdaugh, sentenced after stealing millions in insurance settlements – 16 August 2023
Cory Fleming has been sentenced to nearly four years in prison for scheming to steal millions of dollars in insurance settlements. He and his law firm made about $US675,000 over the settlement, which has since been paid back. Fleming is the second associate of Murdaugh sent to prison since investigators began scrutinising every aspect of his life in June 2021 after his wife and son were shot to death at their South Carolina home.
Ilze Stephens fined for helping son defraud Department of Defence through rent allowance payments – 16 August 2023
Ilze Stephens, a grandmother who helped her son defraud the Department of Defence of close to $100,000 appeared visibly relieved as she was told she would not spend any time behind bars. The charges relate to the 71-year-old nurse’s role in a scheme led by her son, former army major Travis Stephens, that saw him receive $91,705 in rent allowance payments, which he was not entitled to.
DoorDash hit with $2m fine by ACMA for breaching spam laws – 16 August 2023
Online food delivery service DoorDash has been slapped with a $2 million fine for breaching spam rules. An investigation by the Australian Communications and Media Authority (ACMA) found DoorDash sent more than 1 million texts and emails that breached spam regulations between February and October last year. DoorDash will now have to make regular reports to the watchdog.
https://www.abc.net.au/news/2023-08-16/doordash-issued-2m-fine-for-spam-texts/102735232
How scammers use phishing attacks to ‘socially engineer’ their way into your savings – 17 August 2023
Craig McDonald, founder of Australian cybersecurity firm MailGuard, says phishing has evolved into its own underground industry. Scammers recruit qualified coders and developers and support staff from across the globe, and offer 24/7 support for customers, because they’re selling a service at the end of the day, albeit an illegal one. The fake webpages will require victims to enter personal information such as bank account details or email passwords. This information is then used to access bank accounts, where the scammer can transfer money to themselves at will.
https://www.abc.net.au/news/2023-08-16/ing-bank-scams-phishing-refunds-consumers-afca/102732906
Sixth Sydney Man Charged in Million-Dollar Cyber Scam – 17 August 2023
The AFP has arrested and charged a sixth Chinese national living in Sydney as part of an investigation into an organised criminal syndicate, involved in a cyber-enabled investment scam, that has resulted in more than US$100 million in losses worldwide. Investigators will allege the highly-sophisticated scam involved the unlawful manipulation of legitimate electronic trading platforms, normally licensed to foreign exchange brokers who then provide the software to their clients.
https://www.miragenews.com/sixth-sydney-man-charged-in-million-dollar-1067097/
Investigation & Fraud News – Week ending 11 August 2023
12 stories this week:
It started with an Alibaba order. It could end with two brothers being deported – 4 August 2023
Two brothers from Pakistan could face jail time and deportation for their role in a scam that involved 2.4 million fake Australian postage stamps. The County Court heard how federal police raided the brothers’ Brunswick East apartment complex in March 2021, finding 35 boxes filled with counterfeit postage stamps. Police determined the number of seized stamps was approximately 2.4 million Australian stamps of various denominations with a face value of approximately $6 million.
Whistleblowers claim consulting giant KPMG rorted government to the tune of $1.8 billion over last decade – 7 August 2023
Whistleblowers working for a major consulting firm and the Department of Defence have lifted the lid on an alleged $1.8 billion scandal. Two workers, one from KPMG and the other from the Department of Defence, have accused KPMG of ripping off the government by submitting exorbitant invoices and billing for hours not worked while contracted. The company has also been accused of proposing new work already covered by existing contracts, sucking up public funds, and overcharging Defence through alleged financial errors.
Former US president Donald Trump seeks new judge in election fraud case – 7 August 2023
Former US president Donald Trump will seek a new judge in his election fraud case. Prosecutors filed a protective order prohibiting Mr Trump from sharing any legal materials with unauthorised people. Mr Trump’s lawyer said the actions at the centre of the allegations against the former president were requests, not directives.
https://www.abc.net.au/news/2023-08-07/donald-trump-seek-new-judge/102696236
Queensland whistleblower laws need new act: review – 8 August 2023
A review of the Public Interest Disclosure Act 2010, led by retired Supreme Court judge Alan Wilson KC revealed that a higher disclosure threshold should be enacted to target conduct involving corruption, serious maladministration, serious misuse of public resources and serious danger to the environment or public health and safety. The report also stated that the public sector should not be burdened by public interest disclosures which are solely personal workplace grievances, ideological in nature, or trivial.
https://au.news.yahoo.com/queensland-whistleblower-laws-act-review-093935680.html
New digital ID methods could help stem scam losses – 8 August 2023
Industry bodies are hoping the introduction of new digital identification methods will stem the amount of money lost to scams and payment fraud and limit the impact of widespread data breaches. It says once digital identification is created with a provider, it can be re-used across connected services without the need to repeatedly provide identity information to those services.
Melbourne identity theft victims speak out after losing $370,000 to fraudsters – 9 August 2023
The article describes how John and Julie were victim of fraudsters who had ported John’s mobile phone and accessed email accounts, messaged friends, family, and work clients in an effort to pull others into their web. The fraudsters had drained their bank accounts by at least $325,000, sold $45,000 worth of their shares, and created 20 credit and debit accounts in their names. John and Julie say they have lost trust in their banks and their telco, and live in a constant state of fear.
Investigation finds VicForests hired a private investigator to spy on environmental campaigners – 10 August 2023
An investigation has found Victoria’s state-owned logging agency has conducted “unlawful” surveillance of private citizens by hiring a private investigator to spy on them. The investigation found that sometime in 2010 and 2011, the private investigator conducted surveillance, collected personal information and took photos and video after being hired by the previous general manager of VicForests. VicForests has now been told to publish a new surveillance policy by the end of September 2023.
Melissa Caddick investors receive first payout three years after alleged fraudster vanished – 10 August 2023
Investors who lost between $20 and $30 million in Melissa Caddick’s alleged Ponzi scheme have received their first payout, three years after the scandal came to light. The money comes from the sale of her Dover Heights property, which sold for $9.8 million in January, and her share portfolios.
https://www.abc.net.au/news/2023-08-10/melissa-caddick-investors-receive-first-payment/102714524
Australian companies hit every seven minutes by a cyber attack – 10 August 2023
A new report by CrowdStrike found the top five most targeted industries over the 12 months to June were technology, telco, retail, financial services, and manufacturing. One potential intrusion was uncovered every 7 minutes over the year, many directed at consumer focused industries – where vulnerable account data, credit card details and other personal information is stored. Businesses need to have an equal or superior reaction, making sure they have the right visibility and no security gaps.
‘Gatekeepers’ to the board: regulators’ changing expectations of general counsel – 10 August 2023
General counsel have never been under such intense scrutiny. Regulators including the Australian Securities and Investments Commission (ASIC) are zeroing in on officers like general counsel, whom ASIC regard as ‘gatekeepers’, and seeking to hold them responsible for ensuring the prevention of corporate misconduct. Article explains the regulators’ expectations of general counsel in managing and highlighting risk and how these dynamics impact the role and the potential liability of general counsel.
Tasmanian greyhound trainer Anthony Bullock under council investigation over kennel licence – 10 August 2023
Mr Bullock had his Grey hound licence suspended last week while the Office of Racing Integrity investigates conditions at his property in the state’s north, after graphic footage taken at the Exeter property was released by an animal rights group. He is now also under investigation by the West Tamar Council.
ANZ Boosts Scam Fight with Mule Account Detection – 10 August 2023
ANZ has announced it is investing in a new security capability designed to detect mule accounts being used to receive funds from scam victims and other criminal activities. Utilising AI and machine learning, the mule detection capability recognises money mules and mule accounts and is an extension of the bank’s behavioural biometric technologies. The detection of mule accounts often leads to the dismantling of additional scam networks and prevents future scams.
https://www.miragenews.com/anz-boosts-scam-fight-with-mule-account-1063000/
Investigation & Fraud News – Week ending 4 August 2023
10 stories this week:
UK billionaire whose family trust owns Tottenham soccer club pleads not guilty to insider trading – 27 July 2023
Joe Lewis, the British billionaire whose family trust owns the Tottenham Hotspur soccer club has pleaded not guilty to insider trading in New York federal court. It was alleged that he fed corporate secrets to romantic partners, personal assistants, friends and his pilots, earning them millions of dollars illegally. Mr Lewis was charged with 16 counts of securities fraud and three counts of conspiracy.
https://www.abc.net.au/news/2023-07-27/joe-lewis-tottenham-billionaire-pleades-not-guilty/102654298
PwC reveals private settlement over undisclosed matter with Tax Office, as it contended with unfolding tax leak saga – 27 July 2023
PwC has confirmed that it privately settled with the Australian Tax Office (ATO) over an undisclosed matter, while the firm contended with a confidentiality breach within its ranks. At the time the firm was still claiming its confidentiality breach was contained to a single former partner. The Treasurer said he was not aware of the arrangement, and would raise it with the ATO.
https://www.abc.net.au/news/2023-07-27/ato-settled-with-pwc-before-tax-leak-scale-known/102654506
ATO reveals more than $550M lost to online fraud – 28 July 2023
The Australian Taxation Office (ATO) lost more than $557 million to fraudsters using personal details from hacks on Optus and Medibank to create fake MyGov accounts. The cyber criminals were able to bypass the identity checks that would normally be sent to the ATO’s customers by hacking their accounts, with the help of the previously compromised credentials.
Accountant admits transferring cash to ‘fraud account’ to pay gambling debts – 31 July 2023
James Redmond Burrows has pled guilty to 113 fraud-related charges over four years totalling $1.4million. A court has heard he used his clients money to fund his gambling addiction.
https://www.abc.net.au/news/2023-07-31/james-redmond-burrows-tax-agent-fraud-guilty-plea/102668756
Victoria’s anti-corruption watchdog in spotlight as fallout from Operation Sandon report continues – 31 July 2023
A property developer at the centre of a damning report by Victoria’s anti-corruption watchdog has defended himself in a lengthy press conference in Melbourne. The five-year investigation found developer John Woodman had plied suburban councillors with hundreds of thousands of dollars in exchange for project support.
https://www.abc.net.au/news/2023-07-31/operation-sandon-ibac-report-response-john-woodman/102669444
Australia: Whistleblower protections in the private sector – 1 August 2023
This article considers whistleblower protections in Australia, including:
protected disclosure schemes;
private sector whistleblowing;
what is a ‘protected disclosure’;
confidentiality and protection from victimisation;
remedies, penalties and compensation; and
privileges and immunity.
Former banker allowed to contact husband after fraud charges – 3 August 2023
Sara Daizli, a former bank staffer will be allowed to contact her husband after they were both allegedly involved in a financial scam syndicate. She has pleaded not guilty to 237 charges of defrauding financial institutions for her own benefit. Police claim the 31-year-old used her role at the bank to open accounts in fictitious names and allegedly siphoned money into her bank account under a false name.
Hawthorn Football Club cultural safety review author Phil Egan facing fraud charges – 3 August 2023
Phil Egan, the man who accused the Hawthorn Football Club of racism has been charged with 73 offences including obtaining financial advantage by deception, the use of false documents, and secret commission. The allegations of financial mismanagement relate to Mr Egan’s time as CEO of the Murray Valley Aboriginal Cooperative.
https://www.abc.net.au/news/2023-08-03/phil-egan-charged-fraud-offences-hawthorn-afl/102683484
Fraud squad tackles NDIS rorts as payments skyrocket – 3 August 2023
More than $400 million in NDIS payments are being investigated for fraud. The investigations are being overseen by a fraud task force, set up in October to examine rorts of the scheme.
Since April, an extra $100 million worth of possible fraudulent payments are being looked at by the task force.
