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‘Client is in jail’: ATO probes $1,500 payments to prisoners, dead people

Anastasia Santoreneos
·2-min read
Hands of businessmen passing money, Australia dollar bills
Hands of businessmen passing money, Australia dollar bills

“Client is in jail” is a category of JobKeeper recipients being investigated by the Australian Taxation Office (ATO), freedom of information documents obtained by the ABC revealed.

Employers are reportedly signing up prisoners, people living abroad and even dead people to receive the $1,500 per fortnight wage subsidy, which cost the Australian Government around $130 billion.

Documents obtained by ABC showed that the ATO had around 6,000 such cases under investigation, a third of which were found to be ineligible.

While the majority didn’t make the cut because they involved employers applying under the wrong business number, there were also instances of employees being deceased, spouses being put on the books, people living overseas or in prison.

As of July last year, the ATO had rejected around 6,500 applications for JobKeeper, while more than 8,000 were forced to pay back the payments after compliance checks revealed they were never eligible.

While the tax office said the amount of fraud was lower than expected, they had a stern warning for anyone rorting the system: "We will identify those who are intentionally defrauding the system and we will use the full force of the law [to punish them]."

ATO Deputy Commissioner James O’Halloran said the vast majority of Australian businesses and business owners were doing the right thing, and honest mistakes were treated accordingly.

However, he said that wasn’t always the case.

"But there's people that perhaps have tried to rort the system, and they haven't tried to rort the ATO, they've rorted the community.

"So those people we're going to continue to be harsh on. Penalising them, stopping their payments, or in fact prosecutions."

Businesses hand back JobKeeper

It comes as big businesses hand back the wage subsidy to the Government, after posting better-than-expected earnings.

Dominos is the latest business to announce it will return $792,000 in JobKeeper payments to the Government and won’t accept any further assistance despite being eligible to do so.

It follows news that parent company of Rebel Sport, Super Retail Group, returned around $1.7 million in JobKeeper payments after an “unprecedented” first-half.

Toyota, who had claimed payments for nearly 1,400 employees, also returned a whopping $18 million to the Government after record fourth-quarter sales.

"In the end, we were very fortunate to weather the storm better than most, so our management and board decided that returning JobKeeper payments was the right thing to do as a responsible corporate citizen.”

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