The sensational bust of an alleged $165 million tax fraud which embroiled one of the Australian Taxation Office’s most senior commissioners was mostly “fake news” and should be regarded as a “good news” story for the agency, its acting boss told staff on Friday.
The ATO’s acting commissioner of taxation, Andrew Mills, took staff aside during a series of meetings within the organisation last week and coached them on how to respond to family and friends who asked about the scandal.
“You can say that a lot of this is fake news,” he said, according to a source present at the meeting.
“There’s two stories here, one is (an alleged) $165m fraud that we’ve identified in a short period of time, and the other is about a deputy commissioner who (allegedly) did the wrong thing and was caught, which shows that our internal systems worked. Things are working.”
Meanwhile, it has been revealed that the accused principals of the enormous alleged fraud were backed into a corner at the end of last month and excoriated the “draconian and unfair” tax office for freezing their bank accounts and stopping payments, in a series of emails sent just weeks before their arrest.
The increasingly threatening antics of the Plutus Payroll directors has come to light as Sydney’s The Sunday Telegraph newspaper reported tapped conversations between former ATO deputy commissioner Michael Cranston and his son Adam Cranston, an accused ringleader of the fraud, towards the end of last month and at the start of this month. “What I’m petrified about, Addy, is a massive conspiracy,” Mr Cranston allegedly told his son. “I run the phoenix (investigations) in the organisation and … oh, the media go off their head with that.”
Mr Cranston allegedly told his son they would need a “strategy”.
“You just make sure you haven’t got anything in anywhere — you could be subject to search warrants, or — I don’t want to scare you, but you could be,” The Sunday Telegraph reported.
Plutus Payroll Australia, the legitimate company whose directors are accused of siphoning money from customer payrolls, emailed its clients on May 1 and announced its business activities would be suspended immediately.
“Some of you may be affected by payments scheduled on 27 or 28 April, or today 01 May or tomorrow, 02 May,” the email said.
“Please be assured that we are working diligently to resolve the dispute and will keep you informed of our progress.
“Our aim is to recover sums that may be owed to you.”
A second email, distributed by Plutus four days later, informed customers that their missing payments were the fault of the ATO, which had frozen their bank accounts. “Acting in a draconian and unfair manner, the ATO froze Plutus’ bank accounts on 27 April without prior warning or any consultation,” the email said.
Plutus assured its contractors that, rather than placing the company into receivership, its legal team was fighting the ATO to allow the release of funds to its customers.
“The ATO has this evening refused our request. And exhausted our patience,” the email said.