One of the Australian Taxation Office's most senior and long-serving officials is expected to be charged in relation to an Australian Federal Police investigation into an alleged $165 million tax evasion syndicate.
Deputy tax commissioner Michael Cranston was issued with a court attendance notice and is expected to be charged with abusing his position as a public official, though the AFP does not believe him to be directly involved in the fraudulent activities.
Cranston's son and daughter are alleged to have been involved in the scheme and have both been charged by the AFP with conspiracy to defraud, following an eight month investigation.
At a press conference this morning, AFP deputy commissioner of operations Leanne Close explained Cranston's alleged involvement.
"It appears that his son has asked him to access some information potentially. We don't believe at this point that he had any knowledge of the actual conspiracy and defrauding," Close said.
Cranston has served at the ATO for more than 30 years and has actively worked to combat tax crime as a member of the Serious Financial Crime Taskforce. Cranston works extensively both domestically and internationally to reduce the incidence of tax crime, including having recently acted as chair of the OECD Task Force on Tax Crimes.
Also appearing at the press conference, acting commissioner of taxation Andrew Mills said that Australian Public Service (APS) Code of Conduct investigations have also been commissioned into a small number of other ATO employees and that those being investigated have been suspended without pay.
"I cannot overstate the seriousness of these matters - Australians must have a tax administration they can trust and the people of the ATO must be of utmost integrity and good judgement. This is even more important for those in leadership positions; I expect our officers not only to follow, but to champion and role model the APS Values and Code of Conduct," Mills said.
Following the execution of 28 search warrants by more than 290 AFP members yesterday, a further four people were charged with conspiracy to defraud, two others were charged with dealing with property reasonably suspected of being proceeds of crime, and a further two face charges of blackmail.
The AFP alleges the syndicate established a company to provide payroll services to legitimate clients, with money received being transferred to seven subcontracted companies - allegedly controlled by syndicate members - to process payroll. Only part of the required tax payments were processed, with funds paid by legitimate clients to service tax obligations allegedly siphoned off by the syndicate for their own personal gain, channelled through an elaborate series of companies and trusts.
"The scale of this alleged fraud is unprecedented for the AFP; the response from our members yesterday is a direct response to the level of offending that we have identified during this operation," Close said.
Cranston will face Sydney Central Local Court on 13 June 2017.