Senior tax official Michael Cranston has been linked to a criminal conspiracy behind the theft of $165 million from taxpayers to fund the "lavish lifestyles" of a group of Sydneysiders including his son and daughter.
Investigators have seized a haul of luxury items including two planes, sports cars, jewellery, artwork, firearms and at least $1 million cash found in a safety deposit box.
Nine people were charged on Wednesday including Mr Cranston's 30-year-old son, Adam, and 24-year-old daughter, Lauren.
Mr Cranston, 58, has been issued with a court attendance notice for allegedly abusing his position as a senior official of the Commonwealth.
The Australian Taxation Office deputy commissioner is yet to be officially charged but is due to face Sydney Central Court on June 13. He could face five years in jail if found guilty.
Assets seized by the Australian Federal Police also included 25 motor vehicles - luxury, vintage and racing - 18 residential properties, 12 motorbikes and vintage wines.
There was also $15 million being held in personal and business company accounts. In excess of 100 bank accounts and share trading accounts were seized in total.
More than 290 AFP officers were involved in raids on 28 homes and businesses on Wednesday following an eight-month investigation codenamed Operation Elbrus.
"The scale of this allege fraud is unprecedented," AFP deputy commissioner Leanne Close told reporters in Sydney on Thursday.
An estimated $165 million of tax obligations was not paid to the ATO, she said.
The AFP say it's one of the nation's largest white-collar crimes "in terms of the number of conspirators and the amount of money involved".
The ATO revealed four staff have been suspended without pay while subject to an internal investigation.
The fraud ring was allegedly diverting taxpayers' money to fund their "lavish lifestyles", Ms Close said.
"The syndicate members interact socially and they do have business obligations together," AFP Detective Inspector Kirsty Schofield told reporters.
Mr Cranston is "in shock", she said.
Acting Commissioner of Taxation Andrew Mills says Mr Cranston had "up until this point ... held an illustrious career".
"It is of concern that a long-standing officer has been alleged to have been involved in this," Mr Mills said in Sydney.
Ms Close said it appeared Mr Cranston's son has asked him to access certain information.
"We don't believe at this point he had any knowledge of the actual conspiracy and the defrauding," she said.
Adam Cranston was arrested in Bondi and appeared in Sydney's Central Local Court via video link on Thursday charged with conspiracy to defraud the Commonwealth.
He was released on bail on a surety of $300,000 put up by his wife and grandmother and made to surrender his passport.
Police arrested his sister Lauren in Picton. She is due to face a Sydney court on June 13 on the same charge plus another of dealing in the proceeds of crime.
The seven others arrested on Wednesday include Dev Menon, Devyn Michelle Hammond, Daniel Rostankovski, Jason Cornell Onley, Christopher James Guillan, Aaron Leo Paul and Daniel Simon Hausman.
Six additional search warrants were executed on Thursday but there were no further arrests.
The alleged fraud involved payroll services, with a company set up to provide services to legitimate clients but their payments were transferred to subcontractors controlled by syndicate members who pocketed the money.
The ATO issued a statement saying "the people being investigated have been suspended without pay".