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Investigation & Fraud News – Week ending 25 March 2022
15 stories this week:
Star senior manager ‘utterly misled’ bank over use of controversial credit cards at casino, inquiry told – 17 March 2022
An inquiry has been told that a senior manager at Star Entertainment Group “utterly misled” the National Australia Bank, about a controversial credit card used by high-rollers at the casino giant’s gambling venues. In 2019, a Chinese financial services company – became concerned that its cards were being used at Star venues to pay for large “suspicious” gambling transactions in breach of its rules, and passed on its concerns to NAB, with the bank then contacting the casino operator.
Surveillance Is a Huge Issue For Domestic Abuse Victims, So the Government Is Stepping In – 18 March 2022
Following a national survey by WESNET, which revealed that almost all women experiencing family violence suffered from technology abuse, the federal government will invest $104 million over the next five years into domestic violence funding.
https://thelatch.com.au/domestic-violence-australia-funding/
https://www.abc.net.au/news/2022-03-18/dv-survivors-spyware-hidden-camera/100919670
ATO flags cryptocurrency crackdown amid evasion concerns – 18 March 2022
Tax authorities will tighten scrutiny of cryptocurrencies in a bid to ensure users are accurately reporting gains and identify whether it is being used as an investment or for business purposes. The clampdown comes amid regulatory concerns that many taxpayers believe cryptocurrency operates in an anonymous digital world, or that gains are tax-free, or only taxable when holdings are cashed back into Australian dollars. ATO will also target investors correctly calculating costs such as brokerage fees, transfer and platform costs, borrowing expenses, interest on loans, and legal fees.
ACCC takes Facebook owner to court over fake cryptocurrency ads – 18 March 2022
The AC has launched a world-leading legal case against Facebook owner Meta, for publishing scam cryptocurrency ads featuring well-known Australians. The ACCC alleges this conduct is in breach of the Australian Consumer Law or the Australian Securities and Investments Commission Act.
Fraudulent GST refunds land NSW man in jail – 18 March 2022
A New South Wales man has been sentenced after obtaining more than $171,000 in fraudulent GST refunds. In addition to his criminal conviction for tax fraud, he was also ordered to repay the full amount in reparations.
https://www.nationaltribune.com.au/fraudulent-gst-refunds-land-nsw-man-in-jail/
Stolen Bitcoin, fake personas and a trip to Ukraine: Inside the case against crypto heist couple Heather Morgan and Ilya Lichtenstein – 19 March 2022
Social influencer, writer, entrepreneur and amateur rapper Heather Morgan and her husband Ilya Lichtenstein, a Russian-American tech entrepreneur, face up to 25 years in jail if found guilty of conspiring to launder stolen Bitcoin worth billions of dollars.
Mining sector sexual misconduct: FIFO sexual harassment whistleblowers tell shocking allegations to 60 Minutes – 19 March 2022
A married mother of two, who made particularly disturbing allegations of persistent sexual harassment in the mining industry to a parliamentary inquiry, is continuing her whistleblower campaign, fronting cameras to tell her story.
Former Apple employee, charged with fraud amounting to $13.47 million, has finances frozen, five properties seized – 20 March 2022
Dhirendra Prasad, a former Apple employee has been charged with defrauding the tech giant out of more than $US10 million ($13.47 million) by taking kickbacks, stealing equipment and laundering money. The federal government has seized five real estate properties and financial accounts worth about $US5 million from Mr Prasad, and will seek to keep those assets as proceeds of crime.
https://www.abc.net.au/news/2022-03-20/man-charged-defraud-apple-10m-dollars/100924870
Former Kleenmaid director sentenced for fraud and insolvent trading – 21 March 2022
On 18 March 2022, a former Kleenmaid director Andrew Eric Young, pleaded guilty to one count of aggravated fraud by dishonestly causing $330,000 to be withdrawn from a Kleenmaid company bank account, two days prior to administrators being appointed. Mr Young transferred the funds to a bank account held by a company, in which he held an interest and from which he and his wife would benefit.
https://www.abc.net.au/news/2022-03-20/man-charged-defraud-apple-10m-dollars/100924870
Australian judge accuses UN of ‘coup d’etat’ after dismissal from case involving Chinese dissidents – 21 March 2022
Australian judge Rowan Downing, QC, has accused the United Nations of an “attack upon the independence of the judiciary” and a coup d’etat after he was removed from the case of a whistleblower (Emma Reily) who had accused the global body of passing on information to Beijing about Chinese dissidents.
(Access to digital version of SMH required to read article.)
At the heart of all fraud lies deceit: building a profile of a corporate fraudster – 21 March 2022
Dean Mitchell from KPGM, provides some insights on white collar fraud and the people who commit it. He touches on patterns of behaviours and claims corporate fraudsters, according to forensic psychologists, go out of their way to refine their techniques, to avoid past mistakes and maximise what they can get away with.
https://newsroom.kpmg.com.au/heart-fraud-lies-deceit-building-profile-corporate-fraudster/
Alexei Navalny – jailed Russian Opposition Leader and vocal Putin critic – found guilty of fraud – 22 March 2022
A Russian court has found jailed Kremlin critic Alexei Navalny guilty of large-scale fraud and sentenced him to nine years in a maximum-security prison, with police detaining both of his lawyers immediately after the hearing. Navalny is one of the most prominent critics of Russian President Vladimir Putin and has dismissed the criminal case brought against him as politically motivated.
Craig Thomson, accused of AVO breach and facing fraud charges, granted bail – 23 March 2022
Former federal Labor MP Craig Thomson has been granted strict bail after spending the night in custody on the NSW Central Coast, accused of fraud offences and breaching an apprehended violence order. Police alleged he made two fake COVID-19 business grant applications, dating back two years, totalling $25,000.
https://www.abc.net.au/news/2022-03-23/craig-thomson-gets-bail-after-alleged-avo-breach/100933914
Erskine resident warns others after almost losing $300,000 to investment scam – 22 March 2022
A 73-year-old Erskine resident was almost left $300,000 out of pocket after he was targeted by an investment scam. The Australian Competition and Consumer Commission reported people lost over $27,000 to investment scams just in February, 2022. Article reminds readers to check if a financial advisor is registered via the ASIC website and check ASIC’s list of companies you should not deal with.
ASIC financial influencer crackdown targets unlicensed financial advice – 23 March 2022
The financial watchdog has put social media finance influencers on notice, with the ASIC financial influencer crackdown threatening up to five years’ jail and $1 million-plus fines for ‘influencers’ giving out financial advice without a licence.
https://www.channelnews.com.au/asic-targets-finfluencers-who-put-investors-at-risk/
Investigation & Fraud News – Week ending 18 March 2022
11 stories this week:
Unfair practices law needed to improve consumer protection, says outgoing ACCC chair Rod Sims – 4 March 2022
Ex ACCC chair, Rod Sims has said Australia needs a law banning “unfair practices”. He said such a law could help protect consumers from having their own data used against them. He mentioned practices such as false scarcity reminders such as low-stock warnings, false sales countdown timers, targeted advertising utilising consumers’ own data to exploit their individual characteristics, pre-selected add-ons and design interfaces that discourage unsubscribing.
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NSW man arrested after 2 women lost $20k – 11 March 2022
A western Sydney man has been arrested after two women were defrauded and lost savings totalling almost $20,000. NSW Police will allege in court, the man posed as an employee of a financial institution and called the women, telling them their accounts had been hacked. He then allegedly when to their homes before taking their money.
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Scamwatch: It can be hard to say no to a cute puppy but don’t rush in and fall for a scam – 11 March 2022
Australian Community Media has compiled a list of current scams identified on sites such as scamwatch.gov.au, cyber.gov.au and the Australian Competition and Consumer Commission’s website, dedicated to informing people about fraudulent and dishonest activities. This article summarises what to look out for.
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Crown v Shannon: bigwigs off the hook, small fish fried – 14 March 2022
Michael West reports on the world of deluxe double standards. For example, ASIC would NOT be pursuing Crown directors for breaching their duties. Yet ASIC is still pursuing the bank victims advocate, Geoff Shannon of the website Unhappy Banking, even trying to drag him off his hospital bed after spinal surgery to force him to face charges in another state.
https://www.michaelwest.com.au/crown-v-shannon-bigwigs-off-the-hook-small-fish-fried/
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Former Wirecard chief executive charged with fraud – 14 March 2022
Wirecard’s former chief executive Markus Braun has been formally charged by Munich public prosecutors with fraud, breach of trust and accounting manipulation after a 21-month criminal investigation into the collapse of the German payments group.
https://www.ft.com/content/c0bcaaab-546a-4e37-861e-2a29f28e1998
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Fake heiress Anna Sorokin makes new bid to fight deportation – 15 March 2022
Anna Sorokin, the convicted swindler who claimed to be a German heiress to finance a posh lifestyle in New York, is making a new bid to fight deportation. She scammed New York’s elite, hotels and banks out of hundreds of thousands of dollars.
https://www.abc.net.au/news/2022-03-16/anna-sorokin-attempts-to-fight-deportation/100914092
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Mount Gambier MP Troy Bell to face trial on theft charges after losing High Court appeal – 15 March 2022
South Australian Independent MP Troy Bell will face trial in October accused of misappropriating public funds, after he lost his High Court bid to stop the prosecution.
https://www.abc.net.au/news/2022-03-15/sa-troy-bell-high-court-loses-appeal-bid/100911124
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Accidentally paid a fraudulent invoice? Your legal position is murky – 15 March 2022
If you have accidentally paid a fraudulent invoice, are you liable to pay an invoice a second time, or is the supplier liable for failing to have adequate cyber security? The answers to this question will depend on the precise circumstances that occurred surrounding the fraudulent payments. Article reviews basic principles that have been considered.
https://www.lexology.com/library/detail.aspx?g=b88b8b74-ecbd-4236-93f9-0dd48d3d8883
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Investigation after images of Sydney home altered to include ”expansion joints’ that were never there – 15 March 2022
NSW Fair Trading is investigating allegations that builder Metricon photo shopped images of a Sydney family’s dream home, to include expansion joints” that were, in fact, not there.
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ASIC announces new whistleblower review – 16 March 2022
The corporate regulator is preparing to review whistleblower programs from a sample of companies. The upcoming review will assess how selected companies handle whistleblower disclosures, how they use the information from disclosures to address issues or change their operations, and the level of board and executive oversight of the program.
https://www.ifa.com.au/news/30901-asic-announces-new-whistleblower-review
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Mastercard says real-time payments increase risk of fraud – 16 March 2022
Mastercard is developing a new service for banks that will add card-like consumer protections to transactions sent over the real-time payment system that competes with its network.
(Digital access to AFR required to read article.)
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Melissa Caddick’s husband Anthony Koletti pens scathing letter, claiming ASIC ‘dehumanised’ his wife – 17 March 2022
Melissa Caddick’s husband says ASIC removed CCTV cameras from their Sydney home, so they will never know if his wife was murdered. He claims his wife was ‘dehumanised’ in her home by ASIC investigators.
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Mr Flamboyant’s fraud charge begs the question: How can suppliers ensure they’re paid? – 17 March 2022
Article looks at what can suppliers do to ensure they do not find themselves at the mercy of an alleged fraudster who does not pay for good and services rendered.
https://www.smartcompany.com.au/finance/fraud/mr-flamboyants-fraud-suppliers-ensure-theyre-paid/
Investigation & Fraud News – Week ending 11 March 2022
9 stories this week:
Mortgage broker frauds: Here’s how to avoid them – 5 March 2022
There are two primary types of mortgage broker frauds: fraud for profit and fraud for housing. Article explains how they differ and tips hon how to avoid them. Mortgage broker frauds: Here’s how to avoid them
Who Is Liable For Credit Card Fraud In Australia? – 5 March 2022
Card providers in Australia usually have a zero liability stance when it comes to credit card fraud. For those who follow the terms of their offer, there is no concern of liability whatsoever. Article also answers other questions such as “Do credit cards have frauid liability?” and “What Is The Punishment For Credit Card Fraud In Australia?”
https://www.ictsd.org/who-is-liable-for-credit-card-fraud-in-australia/
Half billion-dollar Bill: accused fraudster living the good life in Greece – 6 March 2022
Alleged fraudster Bill Papas has broken his silence as a joint investigation by The Age, Herald and 60 Minutes reveals his comfortable life in Greece. His statement included words such as …”I have been deprived of the opportunity to fund any meaningful engagement with federal proceedings commenced by a well-resourced financial institution. I do intend to address the matters raised at an appropriate time but for now, my primary focus is my health.” McGrathNicol partner and a liquidator to Bill Papas’ businesses, Jason Ireland, says it’s the biggest alleged fraud he’s ever seen.
ASIC moves to shut some recourse avenues for scam victims – 7 March 2022
ASIC is backing a tightening of the voluntary code of practice regulating electronic payments. The changes would limit its usefulness as a mechanism for consumers to recover losses from scams related to ATM, eftpos, card, internet and mobile banking transactions.
https://www.itnews.com.au/news/asic-moves-to-shut-some-recourse-avenues-for-scam-victims-576996
Electronic surveillance law reform a step in the right direction – 8 March 2022
The legislative framework governing electronic surveillance by Australia’s policing and intelligence agencies is undergoing major reforms. However, developing a new, concise, ‘streamlined’ and ‘future-proofed’ framework without excessively compromising right to privacy is complicated.
https://www.aspistrategist.org.au/electronic-surveillance-law-reform-a-step-in-the-right-direction/
Adelaide family loses $93,000 after bitcoin hackers empty secure offline wallet – 7 March 2022
An Adelaide dad’s plan to pay off his mortgage and retire early has backfired, after discovering his off line ”secure” cryptocurrency wallet was hacked. A report from crypto data company Chainalysis released in February found that cryptocurrency-based crime soared in 2021.
Beware the “disaster chasers”: Four ways to avoid scams amid the flood crisis – 8 March 2022
Westpac’s general manager of fraud prevention and financial crime, says scams have almost tripled through the pandemic and perpetrators have been known to pose as insurers, businesses or government organisations offering ‘help’ to victims of extreme weather events such as floods. ScamWatch advises that Australians only donate to a legitimate charity after checking that is on the national register and to be weary of ‘disaster chasers’.
https://www.smartcompany.com.au/finance/fraud/four-ways-avoid-scams-amid-the-flood-crisis/
https://www.nestegg.com.au/save-money/scams/flood-disasters-give-rise-to-scams
Elizabeth Holmes’s ex may hold her ticket to less prison time – 9 March 2022
Any new information that comes out pointing to Holmes’s former partner Ramesh “Sunny’ Balwani’s as the mastermind of the Theranos ”blood testing startup fraud”, improves Holmes’s chances of getting a reduction in prison time. She accused him of emotional and sexual abuse and the force behind everything.
Papas’ girlfriend to return to Australia to fight allegations – 10 March 2022
A lawyer for Bill Papas’ girlfriend Louise Agostino says she will return to Australia to defend allegations made by Westpac, that she was a part of a conspiracy to defraud the bank of $285 million. The bank is seeking a court order that Ms Agostino “pay damages for the tort of unlawful means conspiracy”.
(Access to digital version of AFR required to read article.)
Investigation & Fraud News – Week ending 18 February 2022
13 stories this week:
‘Whistleblowers are suffering’: Lawyers renew calls to drop Collaery prosecution – 9 February 2022
Bernard Collaery is the whistleblower that revealed that the federal government spied on neighbour Timor-Leste during tense negotiations. The proceedings returned before the ACT Supreme Court to hear the Attorney-General’s request to add further, secret evidence. This will support its attempt to reverse an ACT Court of Appeal judgment that denied the federal government a secret trial.
Australian cryptocurrency investors targeted in fake crypto app scam, but Google says it ‘takes action’ when ‘violations found’ – 10 February 2022
The Australian Tax Office estimates up to 600,000 Australians have invested in “crypto-assets”. The latest scam involves fake apps offered on stores like Google Play.
CQUniversity pilot project to byte into cybercrime menace costing Australians billions – 11 February 2022
A CQUniversity-led tech team hopes its prototype device can help Australian businesses combat an escalating cybercrime crisis, which cost the nation a staggering $33 billion last year. The device will snip and sit in the network and whenever there is a human error – such as letting the default password onto your smart device or forgetting to encrypt customer data to your database – it will identify them and prepare a report.
Nuix not out of the woods as yet as ASIC continues to probe – 12 February 2022
ASIC concluded an investigation into the Nuix prospectus and said it was not taking any further action.
(Access to digital version of SMH required to read article.)
Australia drops landmark criminal cartel case against Citi, Deutsche – 12 February 2022
A cartel lawsuit against Citigroup Inc, Deutsche Bank AG and four former executives over a $1.8 billion share issue has been withdrawn. The move ends a challenge to the way investment banks jointly underwrite capital raisings and removes the threat of jail for the former bank executives.
The “Bonnie and Clyde” of cybercrime: a record seizure of stolen bitcoins – 14 February 2022
Heather Morgan and Ilya Lichtenstein were arrested in the United States where they are suspected of having tried to launder more than three billion dollars in stolen bitcoins. The FBI says they tried to hide their tracks using “an extensive range of cutting-edge technologies”.
Trump Organization accountants say financial statements should ‘no longer be relied upon’ – 15 February 2022
The accounting firm that prepared Donald Trump’s annual financial statements says the documents “should no longer be relied upon”, after New York’s Attorney-General said they regularly misstated the value of assets. New York’s Attorney-General is investigating “fraudulent or misleading” valuations.
ACCC issues warning over surge in romance scams – 15 February 2022
Scamwatch noted 3,400 filed romance scam cases that cost Australians $56 million – a 44% increase from the year prior. Keeping in mind that only 13% of victims report the incident. Luring people into handing over money and romance baiting, to lure them into investing in cryptocurrency are the most common romance scams.
https://psnews.com.au/2022/02/16/dating-scams-deliver-financial-heartbreak/
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Fraud sentencing set for March – 15 February 2022
A former financial officer of the Mulwala Water Ski Club has been committed to the NSW District Court for sentencing on three counts of ‘dishonestly obtain financial benefit by deception’. Ms Kaye Leanne Ferguson was initially charged with 27 counts of dishonestly obtain financial advantage by deception after transferring more than $1.1 million from the club to multiple offshore bank accounts between December 2020 and January 2021.
https://www.sheppnews.com.au/news/fraud-sentencing-set-for-march/
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Hollywood email scam nets $900m – 17 February 2022
Los Angeles actor Zachary Horwitz, fabricated email communications, convincing investors to hand over cash, telling them that their money would be used to acquire film distribution rights, which would then be licensed to online platforms like Netflix and HBO. Horwitz was sentenced to 20 years behind bars after admitting he operated a multimillion-dollar Ponzi scheme.
https://ia.acs.org.au/article/2022/elaborate-hollywood-email-scam-nets–900m.html
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Criminal abuse’: record sums of illicit money in cryptocurrency, report says – 17 February 2022′
A report from Chainalysis, reveals record sums of illicit money are being channelled through cryptocurrencies, including theft and money laundering. The research estimates that $A12 billion was laundered in cryptocurrency in 2021, a 30 per cent increase from 2020.
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Warning of fraud risks as travel resumes – 18 February 2022
A new report has warned of vaccination-related fraud risks as Australia reopens to international travellers in coming months. The U4 Anti-corruption Resource Centre told the committee organised crime networks, corrupt healthcare workers and anti-vaxxers were the main perpetrators of fraud.
https://www.canberratimes.com.au/story/7625542/warning-of-fraud-risks-as-travel-resumes/?cs=14231
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Embellishing the truth in a CV is common. But here’s where you can cross the line into fraud – 18 February 2022
Article describes examples of where there’s a clear point at which an embellished CV ventures into criminal territory.
