The Australian Federal Police (AFP) has arrested the director of Plutus Payroll, the company named at the centre of a $165 million tax fraud investigation.
The outsourced payroll management service company left hundreds of IT contractors around the country without wages for weeks after its accounts were frozen by the Australian Taxation Office (ATO) in late April.
The AFP revealed on 19 May that a 33-year-old Lavender Bay man had been arrested and charged in relation to the alleged conspiracy to defraud the Federal Government.
The AFP allege that the man was a former director of the payroll company, which focused heavily on the IT sector, who continued to manage it during the alleged conspiracy to defraud the Government.
Plutus Payroll’s director, Simon Anquetil, was arrested following his return to Australia 18 May, and is the 10th person to be arrested in what is being named as Australia’s biggest ever white-collar fraud case.
Anquetil has been charged by the AFP with conspiracy to defraud. The maximum penalty for this offence is 10 years imprisonment.
The latest arrest in the comes just two days after the AFP arrested and charged nine people for their association with a syndicate allegedly responsible for the $165 million tax fraud.
Six people were charged with conspiracy to defraud the Commonwealth for their alleged role in the syndicate, while two men were charged with money laundering offences.
The AFP has alleged that the fraud involved a company established by the syndicate, Plutus Payroll – which it stresses is a legitimate business – to provide payroll services to its legitimate clients.
The money received from these companies was allegedly transferred to subcontracted companies – alleged to be controlled by syndicate members – to process payroll.
While processing these payments, funds paid by legitimate clients to service tax obligations were allegedly diverted by the syndicate for their own personal gain.
According to the AFP, ATO investigators estimate the amount of tax obligations not paid to Australia’s tax collector to be approximately $165 million.
Plutus Payroll suspended operations on 27 April after the ATO froze its accounts. The move saw the company launch legal action in the Federal Court to access funds with which to pay IT contractors on its books.
The company subsequently told its clients on 10 May that the ATO had agreed to allow the release of the wages owed to its contractors.
It remains to be seen, however, whether contractors on Plutus Payroll’s books will receive all of their entitlements, even if they do receive the wages owed to them.
“Contributions for the more recent pay periods are presently held in the Plutus bank account and it is our intention to continue to discuss this issue with the ATO and have these amounts paid within the statutory deadlines,” the company said on 10 May.