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Investigation & Fraud News – Week ending 21 October 2021
12 stories this week:
Ex-Boeing test pilot indicted for fraud in 737 Max probe – 15 October 2021
Boeing’s former 737 MAX pilot, Mark Forkner, was indicted for fraud for allegedly misleading regulators about problems tied to the aircraft’s two fatal crashes. The ex-chief technical pilot is the first Boeing employee to be charged over the 737 Max’s failures. Three hundred and forty-six people perished in both accidents.
https://abcnews.go.com/Politics/boeing-pilot-indicted-fraud-737-max-probe/story?id=80561974
Court hears about complex web of companies as former Bellamy’s director Jan Cameron faces Hobart court – 19 October 2021
Ms Cameron who is the Former Bellamy’s director and Kathmandu’s founder, is facing charges of failing to disclose information in respect of a substantial holding in a company and allegedly making a false or misleading statement in a document lodged with ASIC in 2017. The prosecution told the court that Ms Cameron engaged in “share-warehousing,” or holding an interest in a company through entities or other arrangements without their name being directly linked to the holding.
https://www.abc.net.au/news/2021-10-19/tas-jan-cameron-bellamy-court-case/100550264
Unauthorised electronic transaction complaints rocket – 19 October 2021
Complaints involving unauthorised financial transactions and scams are rising fast, as use of online services during the pandemic increases and fraudsters become more active. Electronic banking grievances made to the Australian Financial Complaints Authority (AFCA) increased by 76 per cent during the year ended June 30, compared with the same period a year earlier.
NSW police charge two Central Coast men over COVID grants fraud and drug supply – 20 October 2021
Cybercrime squad detectives have charged two men over alleged COVID-19-related rorts and drug supply on the New South Wales Central Coast. One of the men, was accused of lodging fake ‘Job Saver’ and business grant applications for himself and on behalf of others, obtaining about $90,000.
https://www.abc.net.au/news/2021-10-20/two-men-accused-of-fraud-in-nsw-central-coast/100552714
Overwhelming support for fining dodgy finance executives – 20 October 2021
New polling shows that nine in ten Australians, want finance executives to pay a penalty when they break the law. The findings, from a quarterly survey by consumer advocacy group Choice, come just one week before the Coalition is expected to introduce its Compensation Scheme of Last Resort (CSLR) and Financial Accountability Regime (FAR) bills into the House of Representatives.
The compensation scheme, a recommendation from the Hayne royal commission, attempts to protect people who cannot seek redress because the financial services firm that did them wrong has collapsed.
Australian charities need to get better at mitigating fraud risks – 20 October 2021
Cybersecurity incidents in the not-for-profit sector are increasingly common and sophisticated, with recent attacks experienced with Anglicare Sydney, UnitingCare Queensland, and Oxfam Australia, to name a few. However, recent research by PwC highlights that in-house cybersecurity skills are not being prioritised, reflecting a dire need for charities to cost-effectively invest in technology that can prevent and protect them against the latest threats.
Crypto Senate inquiry recommends laws to set Australia up as digital innovation hub – 20 October 2021
A Senate inquiry has recommended changes to taxation laws, licensing and regulatory regimes to encourage digital and crypto-asset businesses to set up in Australia. Tax discounts and a new licensing regime are among the committee’s recommendations. If passed into law, the industry believes Australia could become a digital innovation hub.
Sydney Commonwealth Bank clerk admits stealing $2.4 million to buy house, luxury goods – 20 October 2021
While working as a Customer Service Specialist in 2015, CBA clerk Hsin-Yu Tsai, transferred $2.25m from one customers account into a secretly Netbank savings account. She also withdrew $150,000 in cash from the same customer’s account. She paid off a home and bought luxury items with the proceeds of her fraud.
Underpayments bill balloons to record $148 million last year – 20 October 2021
Australia’s wages watchdog (The Fair Work Ombudsman) recouped almost $150 million for workers in the last financial year, a record figure five times greater than the $30 million it recovered three years earlier and an indication employees are being underpaid on a grand scale.
Facebook whistleblower Frances Haugen tells Australian politicians to regulate social media or be ignored – 21 October 2021
A former Facebook data scientist has told Australian politicians that Facebook fears regulation and that Australia should team up with the US in a bid to rein in its power. Frances Haugen quit Facebook earlier this year and told a congressional hearing, that Facebook’s products were harming children and fuelling polarisation.
Court issues warrant for arrest of Forum Group’s Bill Papas – 21 October 2021
The Federal Court has issued a warrant for the arrest of Forum Group CEO Bill Papas, that is expected to eventually trigger his extradition from Greece to Australia, to face fraud allegations. The arrest warrant comes amid Papas’ alleged failure to adhere to court orders, breaching freezing orders and showing no intention to return to Australia to face fraud allegations from multiple banks.
https://www.arnnet.com.au/article/692358/court-issues-warrant-for-arrest-of-forum-groups-bill-papas/
Mark Zuckerberg Will Be Added as a Defendant in Lawsuit Over Cambridge Analytica Scandal – 21 October 2021
Mark Zuckerberg, CEO of Facebook, might be held personally liable for damages in a consumer protection lawsuit filed in Washington. It is alleged that the social media giant had misled consumers about its privacy policies.
Investigation & Fraud News – Week ending 15 October 2021
12 stories this week:
China billionaire involved in iron ore bribery: Dealings with Australia revealed – 6 October 2021
The Pandora papers have revealed that Du Shuanghua, a Chinese billionaire who confessed to paying bribes for Australian iron ore, continued to trade with major Aussie companies for years even after the scandal became public in 2010.
Bank fraud syndicate facing 200 charges – 7 October 2021
Two former bank employees and two accountants have been charged with more than 200 offences, over a scheme that allegedly netted hundreds of thousands of dollars in fraudulent loans. Police set up a strike force to investigate the syndicate and have now arrested eight people.
https://www.mandurahmail.com.au/story/7461051/bank-fraud-syndicate-facing-200-charges/
ACCC calls for banks to name-check transactions to stop ‘rapidly rising’ scams – 8 October 2021
It has been revealed that Australian banks do not block transactions where the name listed by the sender does not match the account details of the recipient. The ACCC has asked major to update their processes to stop customers from transferring money to fraudsters, after an industry body accused the sector of ‘victim blaming’ to avoid responsibility for scam losses.
Australia urges US to follow its lead in regulating social media giants – 9 October 2021
Facebook has been under scrutiny this week after whistleblower Frances Haugen leaked tens of thousands of documents showing it withheld research into the harms of its products.
Deputy Prime Minister Barnaby Joyce says the government is not joking over plans to regulate social media – 10 October 2021
Australia has intervened in the global push to regulate tech giants, writing to the US Senate to urge it to follow the nation’s lead to make social media companies deliver safer products.
The fallen Star: Sydney’s cleanskin casino caught in ‘dirty’ company – 10 October 2021
‘Star Entertainment’ has been enabling suspected money laundering, organised crime, large-scale fraud and foreign interference within its Australian casinos for years, even though its board was warned its anti-money-laundering controls were failing. According to multiple casino and law-enforcement agents, between 2014 and 2021, Star cultivated high-roller gamblers who are allegedly associated with criminal or foreign-influence operations
Innovation investment is key to consumer trust – 11 October 2021
The rapid digitisation of business including accelerated development of new practices and rapid on-boarding of new suppliers, has been celebrated as the silver lining of the COVID-19 pandemic, but digital identity fraud and cyber attacks will remain.
University investigates claims of research misconduct in studies on ageing – 13 October 2021
The University of NSW has launched a review of allegations of research misconduct in several taxpayer-funded studies such as the research into ageing. The review comes after a well-known scientific sleuth went public with allegations some papers showed evidence of image or data error, or manipulation.
Demands for Premier to face IBAC grilling don’t stack up – 13 October 2021
The calls for Daniel Andrews to be hauled before Victoria’s anti-corruption commission, to face coercive questioning in a public hearing about the alleged misuse of taxpayer funds for political purposes are misguided as IBAC tends to hold a public hearing only if it has strong evidence of alleged wrongdoing.
Sydney inner west man charged over $20m payroll fraud – 14 October 2021
A Sydney man has become the 14th person to face charges over an elaborate $20 million payroll tax fraud and money laundering scheme. It is alleged that the man received and possessed a total of $456,150 that was proceeds of an illegal scheme to siphon off money that should have been remitted to the ATO, and that he was reckless as to the fact that the money was the proceeds of crime.
https://www.miragenews.com/sydney-inner-west-man-charged-over-20m-payroll-648763/
Bill Papas’s companies earned $500 million from fraud, liquidators allege – 14 October 2021
Alleged fraudster Bill Papas may have committed criminal offences according to liquidators, after allegedly siphoning off more than $500 million from Westpac and other major banks since 2013. That is the key finding of a damning liquidators’ report looking into the failure of his equipment leasing company Forum Finance and its related entities. He is also being investigated by the Financial Crimes Squad (a division of NSW Police)
https://www.abc.net.au/news/2021-10-14/bill-papas-forum-fraud-liquidator/100534900
Singapore patrol robots stoke fears of surveillance state – 16 October 2021
Singapore has trialled patrol robots that blast warnings at people engaging in “undesirable social behaviour”, adding to an arsenal of surveillance technology in the tightly controlled city-state that is fuelling privacy concerns.
Investigation & Fraud News – Week ending 8 October 2021
12 stories this week:
Tech firms asked to clarify fraud and scam prevention controls – 1 October 2021
The UK’s Treasury department is questioning tech giants such as Google (GOOGL), eBay (EBAY), Facebook (FB), and Amazon (AMZN) on what they are doing to fight economic crime, prevent fraud, and protect consumers on their platforms.
FCC proposes new rules to combat SIM swapping scams – 1 October 2021
SIM swapping scams have been on the rise these past couple of years, and since most online services these days are tied to people’s phone numbers, the technique has the potential to ruin victims’ lives. The Federal Communications Commission is seeking to create new rules that would help prevent SIM swapping scams and port-out fraud, both of which are techniques designed to hijack people’s phone numbers and identities.
https://au.finance.yahoo.com/news/fcc-proposes-new-rules-sim-swapping-scams-093840753.html
Business woman embezzled $1m from family company – 2 October 2021
A former North Queensland lawyer and Ingham business owner has faced court after embezzling more than a million dollars from the company, she owned with her two brothers.
https://townsvilleonlinenews.com.au/nq-businesswoman-embezzled-1m-from-family-company/
(Digital Access required to read article.)
Australian financial institutions want AML loopholes solved – 4 October 2021
Australian banks and fintechs have raised concerns to the senate over major loopholes in the country’s anti-money laundering legislation. Organisations have outlined support for ‘Tranche 2’ legislation that would have Designated Non-financial Business and Professions (DNFBPs) such as law firms, accountants, and real estate agents coming under similar laws to banks, emitters, and wagering companies in relation to anti-money laundering and counter-terrorism financing regime (AML/CTF).
Scamwatch issues warning over new photo text Flubot malware – 4 October 2021
The notorious Flubot scammers have rolled out a sneaky new tactic designed to catch Aussies unawares, after their two other ploys were widely reported on. Now Australians are being duped into thinking their photos have been shared online.
‘Tearing our societies apart’: Facebook whistleblower’s revelations fuel concern in Australia – 4 October 2021
Facebook has been accused of “paying for its profits with our safety” and “causing ethnic violence around the world”. Former employee turned whistleblower Frances Haugen said the internal documents she leaked to the Wall Street Journal, demonstrate Facebook had embraced algorithms that amplified hate speech in pursuit of profits, claims the company has strongly disputed.
Clock is ticking: the walls are closing in on the $2.8tr crypto market – 4 October 2021
The cryptocurrency market is under a lot of regulatory and governmental pressure. In the US, Securities and Exchange Commission wants the power to regulate crypto assets as securities, arguing that the sector is rife with fraud, scams and abuses.
White House plans 30-country meeting on cybercrime and ransomware – 5 October 2021
Top US national security advisers will gather officials from 30 countries this month with plans to combat the growing threat of ransomware and other cyber crime. They are looking at improving law enforcement collaboration on issues like the illicit use of cryptocurrency.
Pandora Papers show mystery foreign investors making it harder for Australians to buy property – 5 October 2021
Pandora Papers show Rio Tinto continued to trade with Chinese billionaire Du Shuanghua after bribery scandal
Almost 12 million leaked documents – known as the Pandora Papers – have shed light on how complicated, offshore business structures are being used in Australia to shroud corporate ownership in secrecy. Since around 2016, there have been calls for a register of beneficial ownership, to force details of ultimate company owners into public view. https://www.abc.net.au/news/2021-10-05/pandora-papers-show-impact-of-mystery-foreign-property-investors/100515630
Home buyer caught in $100,000 bank scam hits out at ‘dismissive’ NAB – 5 October 2021
Complying with anti-money laundering laws and protecting customers against scams are two costly and mounting tasks for the major banks. NAB is working on a mammoth internal project, called Apollo, that involves examining millions of customer accounts to ensure identification details are up-to-date.
Investment scam losses reported to ACCC set to double in 2021 – 5 October 2021
Australians lost more than $851 million to scams in 2020 – the worst year on record – and it looks like 2021 will be another banner year for scammers. People aged 65 and older were the group that had lost the most to investment scams as of August this year and people aged 18 to 24 had reported $1.7 million in losses to the ACCC as of August – a 259% jump on all of 2020.
Investigation & Fraud News – Week ending 1 October 2021
13 stories this week:
Aussie crypto kid gets over seven years in US jail for Ponzi scheme – 16 September 2021
Stefan Qin, a 24-year-old Brisbane man, used investor’s money on a lavish lifestyle, including a $US23,000-a-month Manhattan penthouse apartment. Federal prosecutors said Qin defrauded more than 100 people out of about AUD $123 million. Investors thought they’d found a sure thing — a hedge fund that was generating 500 per cent returns by exploiting the price gaps between cryptocurrencies on 40 exchanges throughout the world.
ANZ reports a 73% year-on-year increase in scams for the first eight months of 2021 – 23 September 2021
ANZ had seen a 73% increase in scams being detected or reported by customers, compared to the same time last year. The most prevalent and successful scam involves criminals gaining remote access to consumer customer computers and the devices. ANZ chief executive Shayne Elliot, has encouraged the Standing Committee of Economics, to prioritise the need to raise further awareness and address the rising number of scams.
Bitcoin trader takes banks to court over cryptocurrency ‘discrimination’ – 24 September 2021
The ACT Civil and & Administration Tribunal, will hear a case between Canberra man Allan Flynn and two of the nation’s biggest banks, over their decision to stop doing business with him, because he operated a cryptocurrency trading platform. If successful this could have enormous ramifications for the bitcoin-shy Australian banking sector.
Bitcoin.org website offline after being hacked – 25 September 2021
Bitcoin.org suffered a breach Thursday that has already cost unsuspecting bitcoin users lots of money. Visitors to the site were greeted with an invitation to send bitcoin to the “Bitcoin Foundation” with hackers promising they would double funds sent to the address.
https://micky.com.au/bitcoin-org-website-offline-after-being-hacked/
Australia: An Increasingly Global Approach – 27 September 2021
This article considers the major Australian government investigative, law enforcement, and regulatory agencies involved in domestic and transnational investigations, with a particular focus on their increasing need to adopt a global approach to adequately protect Australians from criminal threats, both local and international.
Foreign ownership investigation of A-League soccer teams reveals human rights concerns, match-fixing links – 27 September 2021
An investigation into foreign ownership of Australian soccer clubs, has uncovered links to an Indonesian executive, jailed over a major match-fixing scandal and accusations of “sportswashing”, by one of the wealthiest Arab states.
https://www.abc.net.au/news/2021-09-27/football-foreign-ownership-a-league-investigation/100476618
Papas executive accused of failing to act on 2018 whistleblower report – 27 September 2021
A senior executive at Bill Papas’ business has repeatedly claimed he only learned about the $400 million fraud in June this year, despite being warned of potential contract irregularities in 2018 by an internal “whistleblower”.
Anthony James Hill pleads guilty to fraud-related charges after stealing $28,000 from New Norfolk Golf Club – 27 September 2021
Anthony James Hill pleaded guilty to 37 fraud-related charges after stealing more than $28,000 from the New Norfolk Golf Club, while acting as Treasurer and being entrenched in a decade long romance scam.
Phone scams are ‘exploding’ and costing vulnerable Australians millions, new data shows – 28 September 2021
Australians have lost $63.6 million to scams involving unsolicited calls or text messages so far this year, according to the ACCC’s Scamwatch program. Indigenous Australians in particular, are seeing increasing financial losses from phone-based scams. Experts are calling for vigilance and for people to report potential fraud.
https://www.itnews.com.au/news/australians-lose-211-million-to-scammers-570381
PwC opens investigation into racist misconduct at staff event – 29 September 2021
Professional services firm PwC is facing accusations of racist misconduct among its staff at a company-run event, with one diversity and inclusion leader said to have mocked Chinese accents.
Sydney inner west man charged over $20m payroll fraud – 29 September 2021
It is alleged that an Earlwood man received and possessed $456,150 that was proceeds of an illegal scheme to siphon off money that should have been remitted to the ATO, and that he was reckless as to the fact that the money was the proceeds of crime.
Financial firms brace for ‘pitiless’ month of new laws – 30 September 2021
Banks, fund managers and insurers will from October become subject to a raft of new regulations flowing from the Hayne royal commission, including a controversial rule forcing them to “dob in” themselves and their business partners for suspected breaches of the law.
(Access to digital version of AFR required to read article.)
China bans cryptocurrency transactions – 1 October 2021
China has declared the use of digital currencies illegal, saying they disrupt the financial system and are used in money-laundering and other crimes.
