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Investigation & Fraud News – Week ending 30 July 2021
12 stories this week:
Melbourne couple sentenced to prison for $54,000 COVID-19 fraud – 24 July 2021
A man and woman living in Melbourne have been sentenced to prison over a series of fraudulent COVID-19 Pandemic Leave Disaster Payments (PLDP), totalling $54,000
Who is Bill Papas, the man at the centre of Westpac’s ‘elaborate fraud’ allegations? – 24 July 2021
Westpac, Societe Generale and Sumitomo are said to have lost $400m due to alleged fraud by the Sydney businessman Bill Papas from Forum Finance. Westpac has now obtained freezing orders from the Federal Court and is trying to track down and seize any properties Mr Papas may own across the world.
Forum Group: The entity at the centre of staggering $400m fraud allegations is “open for business”https://greekcitytimes.com/2021/07/27/forum-group-the-entity-at-the-centre-of-staggering-400m-fraud-allegations-is-open-for-business/
Australians more gullible than most for tech support scams – Microsoft Survey – 26 July 2021
Australians are more likely than any other nation (except India) to be victims of tech support scams because we are an affluent target. A Microsoft report shows 31% of Australian Millennials (aged 24-37), 30% of Gen Xers (aged 38-53) and 16% of Gen Zers (aged 18-23) were the most susceptible and continued tech support scam interaction. 61% of these were males.
Growth at what cost? How CEOs of Australian banks are incentivised to take risk – 27 July 2021
The Monash University research team identified a direct link between ASIC investigating or penalising a company, and the way CEOs are paid. A recent study is among the first to directly link CEO incentive pay to adverse firm events such as fraud and money laundering of Australian banks. The research found that adverse firm events are 42% more likely to occur when the majority of CEO pay comprises stock options and shares.
When the fixer from Wagga met the conmen from Shanghai – 28 July 2021
An ABC investigation unravels how the former MP (Daryl Maguire) did favours for Mr Liu’s company, which allegedly swindled vast sums from Australians and became embroiled in a devastating international fraud.
New ASIC chair Joseph Longo warns about unregulated cryptocurrency trading and other economic threats to pandemic recovery – 29 July 2021
New ASIC boss Joseph Longo’s focus is helping people and businesses through COVID and shutting down pandemic scams. He is particularly worried about unregulated cryptocurrency investments and scams. Mr Longo says decisions to prosecute are ultimately up to the Director of Public Prosecutions.
ATM skimmers fleece millions from Melbourne bank customers – 29 July 2021
Police have released images of five men believed to be linked to an international ATM skimming scam, that has fleeced millions of dollars from Melbourne bank customers this year. At least 28 machines around Melbourne have been compromised since March, in an elaborate scheme believed to have links to Eastern European crime gangs.
(Access to the digital version of the Age required to read article.)
Premier’s office was warned about Maguire’s business associate two years before corruption inquiry – 29 July 2021
Businessman, Jimmy Yang, is accused of widespread fraud and entangled in a financial scam that took $46 million from more than 900 retirees.
https://www.abc.net.au/news/2021-07-29/premier-s-office-warned-of-liu-and-uwe-in-2018/100312594
Maptek founder accused of $38.5m tax fraud – 30 July 2021
The 74-year-old Adelaide-based mining tech entrepreneur Bob Johnson, has been charged with hiding overseas assets over 15 years to avoid $38.5 million in income tax. The Australian Federal Police (AFP) will allege that Dr Johnson failed to disclose overseas trust assets in his income tax returns, in an effort to evade income tax in Australia between 1999 and 2013.
https://www.accountantsdaily.com.au/tax-compliance/15989-maptek-founder-accused-of-38-5m-tax-fraud
ASIC sues AMP companies over fees for no services allegations – 30 July 2021
ASIC has commenced Federal Court proceedings against six companies that are, or were, part of AMP Limited (ASX: AMP), alleging the entities charged fees for no service on 1500 corporate superannuation accounts.
High-flying accountant with multiple Block properties jailed over ‘calculated’ GST fraud – 30 July 2021
David Brandi, a wealthy accountant and property-owner, whose purchased homes from ‘The Block’ and a high-profile nightclub, learned his fate in the County court, over a complex GST fraud committed more than 10 years ago. It is alleged that he ended up pocketing $135,248.67 in false GST refunds in statements lodged with the ATO.
Investigation & Fraud News – Week ending 16 July 2021
13 stories this week:
SAPOL search uncovers stash of fake driver’s licences – 16 July 2021
An ongoing SA Police investigation into identity theft has seen four alleged offenders arrested after a search of a home uncovered more than 100 fake or stolen licences, health and bank cards, along with amounts of amphetamine and drug paraphernalia.
Bigwig in the big house: Ex-education boss jailed for school funds rorts – 16 July 2021
Former Education Department chief Nino Napoli, is in prison after being jailed this week after he and family members defrauded school funds in calculated rorting over a period of seven years. Napoli approved fake invoices and dodgy contracts totalling $500,000 by concealing his connections to relatives’ businesses, and either used department money or directed banker schools to pay invoices.
Are you ready for the Fraud & Corruption Control changes? – 16 July 2021
Adam Simms Partner, Forensic Services, was invited to be part of the review of the existing Standard and gives us insights into the new Australian Standard AS8001:2008 – Fraud & Corruption Control that was released on 11 June, 2021. This Standard is considered the benchmark when it comes to how organisations can mitigate fraud and corruption risks. This Standard is of particular importance to Boards, and importantly how they assess their cyber risks.
Revealed: Alleged Westpac fraudsters in multimillion-dollar property binge – 16 July 2021
The alleged $360 million fraud by Bill Papas’ Forum Finance against Westpac has been described by a judge as “a long-running, calculated and elaborate fraud which would rank high in the catalogue of corporate misfeasance”. The fraud is alleged to have been conducted between 2018 and 2021.
Whistleblower alerted Forum auditors to potential fraud
An internal whistleblower at the Forum Group of Companies emerged within two weeks of Westpac contacting Bill Papas about anomalies regarding a contract with corporate client WesTrac.
No AMP heads on pikes after ASIC drops criminal probe – 17 July 2021
ASIC drops criminal investigation into AMP’s fees for no services scandal after the Commonwealth Director of Public Prosecutions found the case should not be taken to court.
https://www.afr.com/companies/financial-services/asic-scraps-amp-criminal-action-20210716-p58a8p
(Access to digtal version of SMH/AFR required to read this article.)
Aussie crypto mogul fights extradition to the US – 17 July 2021
Australian bitcoin mogul Greg Dwyer is fighting extradition to the United States from his home in Bermuda even after his co-accused in one of the world’s biggest cryptocurrency scandals have presented themselves to US authorities.
(Access to digtal version of SMH required to read this article.)
ClubsNSW seeks court order to stop pokies whistleblower speaking to media – 17 July 2021
ClubsNSW is aiming to stop pokies whistleblower Troy Stolz talking to the media about a case the lobby group is mounting against him, in the federal court. The move is a dramatic escalation in the legal fight between the powerful lobby group and Troy Stolz, its former anti-money laundering and counter-terrorism financing manager.
Scamwatch: Remote access scams increase 184 per cent – 19 July 2021
So far this year scammers have stolen more than $7.2 million from Australians by gaining access to home computers, an increase of 184 per cent compared to the same period last year. Australian Community Media has compiled a list of current scams identified on sites such as scamwatch.gov.au, www.cyber.gov.au and the Australian Competition and Consumer Commission’s website dedicated to informing people about fraudulent and dishonest activities.
Ex-Young Rich Lister Craig Gore loses fraud appeal = 21 July 2021
Craig Gore, who once owned a race car team and shone briefly as a Gold Coast developer, had lawyers file an appeal against a verdict that found he had swindled investors in a debenture scheme. They included everyday Australians setting up self-managed superannuation funds.
A key event in the guilty verdict centred on evidence of Gore’s knowledge of the business having a substantial debt owed to the ATO.
(Digital version of AFR required to read article.)
Westpac accuses Forum and Papas of 100 frauds – 22 July 2021
The details of the extent of Mr Papas’s fraud were detailed in a statement of claim filed by the bank this week against Mr Papas, his business partner Vincenzo Tesoriero, Forum Finance and its related companies.
AMP sexual harassment victim left fuming from Boe Pahari’s $50m payout – 22 July 2021
A sexual harassment victim (Julia Szlakowski) is furious after Boe Pahari who allegedly made inappropriate advances and drove her out of the company is set to get a $50 million “golden parachute” payout.
Firms ‘face extinction’ for failing women – 22 July 2021
Ms Szlakowski has called on companies and investors to “conduct themselves within the moral and ethical norms of their customer base, or rightly risk extinction”.
Investigation & Fraud News – Week ending 16 July 2021
15 stories this week:
New data reveals AFCA received a whopping 70,000 complaints in the last year generating millions of dollars worth of refunds to Aussies – 8 July 2021
The Australian Financial Complaints Authority (AFCA), a non-government ombudsman, received 70,000 complaints over the 2021 financial year and secured more than $240 million in compensation and refunds. The most complained about products were: Credit cards (14%) Home loans (9%) and Personal transaction accounts (8%)
https://www.finder.com.au/240m-afca-refunds-approvedaction-investigation/
Long-running, calculated and elaborate fraud’: Firm at the centre of Westpac scandal to be wound up – 9 July 2021
The Federal Court has ordered the company “Forum Finance” at the centre of an alleged $250 million fraud against banking giant Westpac be placed into liquidation, while the exact whereabouts of its football personality (Bill Papas) the director remain unknown.
Major crypto scammer sentenced to 15 years in prison – 9 July 2021
The mastermind behind what the government says is one of the largest cryptocurrency Ponzi schemes prosecuted in the US has been sentenced to 15 years in prison. Roger Nils-Jonas Karlsson, defrauded thousands of victims and stole tens of millions of dollars over 10 years.
https://au.finance.yahoo.com/news/crypto-ponzi-scam-roger-nils-jonas-karlsson-doj-071142854.html
MAFS star to face trial over fraud scam – 9 July 2021
It is alleged that Daniel Webb who was a reality television contestant, was involved with a multi-million dollar “boiler room” telemarketing scam. The prosecution argues the scam raked in about $24 million from hundreds of victims in 2013 and 2014.
https://thewest.com.au/news/crime/mafs-star-to-face-trial-over-fraud-scam-c-3355449
Queensland director hit with ASIC penalty – 9 July 2021
A Queensland director has been disqualified from managing corporations for three years following an investigation by ASIC. He “failed to exercise his powers and discharge as a director with care and diligence, good faith and in the best interest of the companies; failed to take reasonable steps to ensure that the companies complied with their obligations to keep accurate written financial records; and failed to assist the liquidators by not delivering the companies’ books and records”.
https://www.mybusiness.com.au/human-resources/8269-queensland-director-hit-with-asic-penalty
Shred Away Identity Theft – 10 July 2021
The Labor Government is reminding people to dispose of confidential documents securely, while working from home to protect themselves from identity theft. This is often done by scammers physically stealing personal information through mailboxes or discarded documents or fake emails.
https://www.miragenews.com/shred-away-identity-theft-593580/
Australians lost $7.2 million in home computer scam – 12 July 2021
ACCC’s Scamwatch said scammers have stolen more than $7.2 million from Australians by gaining access to home computers so far this year. Scammers take advantage of the ability to remotely access people’s computers or smart phones.
https://infotechlead.com/security/australians-lost-7-2-million-in-home-computer-scam-67466
‘Real and present danger’: Government considers making company directors personally liable for cyber attacks – 13 July 2021
Company directors could be held personally responsible for cyber attacks, under new standards being discussed with industry.
Corporate watchdog takes SmileDirectClub to court, alleging thousands misled by teeth straightening insurance claims – 13 July 2021
Tens of thousands of Australians ordered clear teeth aligners and underwent treatment after allegedly being incorrectly told, their health insurance would cover part of it. ASIC has alleged this was false and misleading.
Australians losing billions of dollars to cyber crime: Report – 13 July 2021
A report published by the Australian Institute of Criminology (AIC) said citizens were losing billions of dollars every year to cyber crime. It found that Australians spend A$1.4 billion on preventing cyber crime every year and A$597 million on dealing with the consequences of cyber attacks.
British police seize record $545m haul of cryptocurrency – 14 July 2021
British police have seized record hauls of cryptocurrency totalling A$545 million as part of an investigation into money laundering, after organised crime groups moved into cyptocurrencies to wash their dirty money.
https://www.itnews.com.au/news/british-police-seize-record-545m-haul-of-cryptocurrency-567311
Japan bank reveals $100 million Forum Finance exposure – 14 July 2021
Sumitomo Mitsui Banking of Japan has become the latest major bank trapped by an alleged fraud carried out by Sydney-based firm Forum Finance, with an exposure of nearly $100 million.
Finfluencers are on the rise, so are they friend or foe? It can be murky territory – 14 July 2021
The laws around providing unlicensed financial advice are murky. Recently there have been calls for more regulation and oversight with the influx of finfluencers. https://www.abc.net.au/news/2021-07-14/finfluencer-tik-tok-instagram-social-media-financial-advice/100289102
Cyber criminals increasingly target builders – 14 July 2021
Cyber criminals are increasingly targeting the construction industry and, as large builders improve their guard and systems, hackers are training their sights on smaller companies such as consultants, contractors and suppliers.
https://www.afr.com/property/commercial/cyber-criminals-increasingly-target-builders-20210713-p589ez
Fraudsters discover the easiest way to rob a bank – 15 July 2021
A good article summarising how invoice financing fraud has occurred with the Forum Finance and Westpac situation and why these incidents continue to occur. Forum Finance, sold products (ie case waste management devices) – to large reputable customers that paid using a Westpac loan. Westpac, however, paid the money directly to the vendor business and relied on that business to pass on the lease payments that were being made by the customer. The invoices presented to the bank showing what the reputable customer owed facilitated the transfer, while the assets were the collateral that could be taken if the customer never paid. The problem is that the products allegedly didn’t exist: the invoices appear to be fabricated, while the lease payments weren’t made by the customer but by the business to keep up appearances. The whereabouts of the balance is now a mystery.
Investigation & Fraud News – Week ending 9 July 2021
12 stories this week:
ASIC warns about social media-driven ‘pump and dump’ scams – 2 July 2021
“Pump and dump” is a scam in which criminals artificially inflate the price of a stock, by promoting fake news or positive depictions of a company, in order to increase trading and profit by later selling the inflated shares. Melbourne trader Gabriel Govinda has appeared in the Magistrate’s Court faced with 23 charges of market manipulation and 19 charges of illegal dissemination of information.
Westpac alleges football tycoon’s firm engaged in $200m fraud – 2 July 2021
Federal Court proceedings have been filed against ‘Forum Finance’, after the discovery of allegedly fraudulent activity of $200 million involving a finance company controlled by the owner of the Sydney Olympic Football Club, Bill Papas.
‘Long-running, calculated and elaborate fraud’: Firm at the centre of Westpac scandal to be wound up – 9 July 2021
Dirty money: How the banks and AUSTRAC are fighting back against financial crime – 2 July 2021
Financial crimes watchdog AUSTRAC raised concerns about NABs compliance this week, as the financial industry is confronted with complex anti-money laundering, as criminals become more and more sophisticated.
Black Hats, tax havens: Australia’s biggest insider trading probe revealed – 3 July 2021
A questionable transfer of Nuix shares to Stephen Doyle’s Swiss-based brother Ross, is now part of an ASIC investigation into whether the family, may have pulled off one of the country’s biggest insider trading heists, using companies in offshore tax havens to disguise their tracks.
Senior cardinal, 9 others, face Vatican fraud tri – 3 July 2021
An influential Cardinal Angelo Becciu and nine others will be tried over alleged financial wrongdoing linked to the purchase of a plush London property. Becciu will be prosecuted over embezzlement, abuse of power and witness tampering.
https://au.news.yahoo.com/senior-cardinal-9-others-face-114840738.html
The Trump Organization has been charged with tax fraud. What could that mean for the former president’s company – 4 July 2021
Former US president Donald Trump’s company was hit with charges of criminal tax fraud this week, with allegations it helped executives cheat their own taxes.
https://www.abc.net.au/news/2021-07-04/donald-trump-organization-tax-fraud-charges/100266220
Alleged fraudster moved $8 million of clients’ money through Crown casino – 5 July 2021
Crown Resorts has called an immediate inquiry into claims an alleged fugitive corporate fraudster (Michael Gu) laundered millions of dollars through its Melbourne casino. Mr Gu then either withdrew the money or used it for gambling.
‘I smell a rat’: Westpac alleged fraud leaves trail of forged signatures, false documents – 6 July 2021
Westpac says at least seven major corporate customers including Coles, Woolworths, Veolia and WesTrac have been caught up in an alleged fraud involving fake invoices and forged signatures that could cost the bank more than $290 million.
Prison disciplinary hearings held ‘in the dark’ with little transparency – 7 July 2021
Victoria’s Ombudsman has found that prisoners were denied basic procedural fairness, because there was no formal requirement for written reasons for decisions and no internal review processes in place.
5 giveaway signs of stock market scams and how to avoid them – 7 July 2021
The Australian Competition and Consumer Commission’s (ACCC) Scamwatch reported recently that last year alone, Australians lost $176.1 million to scams, up by almost 23 per cent in 2019. Article details how investors spot stock market scammers and, more importantly, how to avoid them.
https://www.nestegg.com.au/save-money/scams/5-giveaway-signs-of-stock-market-scams-how-to-avoid-them
Family Court judge resigns amid sexual harassment investigation – 8 July 2021
Joe Harman a Family Court judge, based in Parramatta has resigned after an independent investigation found that he had sexually harassed two junior female court staff and had a history of breaching protocol. https://www.lawyersweekly.com.au/biglaw/31872-family-court-judge-resigns-amid-sexual-harassment-investigation
