Hundreds of Australians have been caught up in a global tax sting targeting money laundering and tax evasion.
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The Australian Tax Office (ATO) on Friday revealed it had taken part in a major operational activity together with tax authorities from the UK, US, Canada and the Netherlands.
The sting was part of an investigation into a financial institution in Central America, which is believed to have been used to launder money for clients across the planet.
The day included subpoenas, search warrants and interviews, with the ATO expecting criminal penalties to arise in each country.
The five countries formed the Joint Chiefs of Global Tax Enforcement (J5) in 2018 to take on international money laundering, with the coordinated strike the first action from the group.
“Working with the J5 countries who all have the same goal, we are able to broaden our reach, speed up our investigations and have an exponentially larger impact on global tax administration,” Don Fort, US Chief, Internal Revenue Service criminal investigation.
“Tax cheats in the US and abroad should be on notice that their days of non-compliance are over.”
ATO deputy commission and Australia’s J5 chief Will Day said the action highlighted the “power of our combined efforts”.
“This multi-agency, multi-country activity should degrade the confidence of anyone who was considering an offshore location as a way to evade tax or launder the proceeds of crime,” Day said.
“Never before have criminals been at such risk of being detected as they are now. Our increased collaboration, data analytics and intelligence sharing mean there is no place worldwide you can hide your money to avoid contributing your obligations.”
What next for Australians?
The ATO has begun investigating Australian clients of the Central American Bank, with the Australian Criminal Intelligence Commission also investigating those implicated.
“International tax evasion robs our public services of vital funds, undermines economies and, left unchecked, can enrich the dishonest at the expense of the honest majority,” Simon York, chief and director of Her Majesty’s Revenue and Customs (HMRC)’s Fraud Investigation Service said.
“Working together... [we] are closing the net on tax criminals, wherever they are, to ensure nobody is beyond our reach. The message to them is clear – the J5 are closing in.”
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