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Adelaide reseller faces gaol after ATO sting

Adelaide reseller faces gaol after ATO sting

Adelaide computer retailer Allen Chambers has been found guilty of 32 counts of fraud and one of organised crime after avoiding sales tax between 1992 and 1995.

The Adelaide District Court has imposed a sentence of three years jail with a minimum of 12 months to serve, and Chambers has also been asked to cough up the $77,868 he defrauded over the period of the offence.

It was proven that during 1992 and 1995, Chambers purchased and imported computer hardware through a Customs agency and quoted sales tax exemption numbers he was not entitled to use. This helped him avoid $49,161 in sales tax. It was also alleged that between 1993 and 1995, Chambers purchased computer hardware from distributors Westan, Edge Computer and Gatum Dale to resell to consumers. Chambers defrauded the government by making the purchases through a fictitious deregistered company called Donatello and by using a lapsed tax exemption number. This saved Chambers around $28,707.

The Court alleged Chambers used an "elaborate web of deceits" to mask his identity and avoid the offence being linked to him. These included using false names and addresses and the sales tax exemption numbers of other entities. He was also accused of using the particulars of old school friends and childhood acquaintances to mask his identity. To hide the paper trail, Chambers paid cash for the goods and collected from the suppliers rather than offering an address for delivery.

Judge David Smith said in his sentencing that Chambers' deceit had an effect on his competitors in Adelaide. "The clear result is that you were able to generate more profit for yourself, or at least compete more vigorously with other computer retail businesses," he said.

Chambers is now bankrupt and in debt to the Australian Taxation Office to the tune of more than $1 million. He was sentenced to three years prison, but pending good behaviour and a $5000 bond, should only face 12 months behind bars.

"Your offending here was premeditated and protracted," said the judge. "It was motivated by greed rather than need. The web of deceit surrounding the offending was so intricate and devious that it is little wonder that it went undetected for so long."

The sentence is the result of an investigation by the Australian Tax Office's (ATO) Fraud Section which is taking particular note of the computer industry. "Identifying and investigating fraudulent activity is a high priority for tax office investigators," said tax commissioner Michael Carmody. "The judge's decision to impose a minimum one-year sentence shows the court also takes a dim view of people setting out to defraud the community's tax system."


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