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Long-running ATO case dating back to the early noughties ends in jail term for conspirator who fled overseas.
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Resort developer gets 10-year sentence for $15m tax fraud
13 February 2024
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9 minute read
A developer who conspired to defraud the taxman out of $15 million has been sentenced to 10 years in jail after a two-decade pursuit by the ATO.
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Executive Li Zhang of golf resort developer the Hightrade Group was found guilty of lodging inflated BAS claims during the early noughties when the Chinese company was working on projects in the Hunter Valley and Sydney.
His sentencing ends a long-running case that began in 2008 after ATO audits scrutinised five years of activity by conspirators at the company.
One employee, Peter Chang, was jailed for the matter in 2016 but his co-conspirators – including Mr Zhang – fled the country while under investigation. His sentencing last week follows extradition from New Zealand in 2019.
ATO assistant commissioner Jade Hawkins welcomed the result.
“Mr Zhang conspired to lodge fraudulent BAS on behalf of two companies which he was involved with,” she said.
“These companies were part of the Hightrade Group, which developed high profile properties in the Hunter Valley and Sydney regions.”
“The fraud involved the use of multiple related companies that grossly inflated construction costs between themselves, and ultimately failed to remit the GST to the ATO. There were also claims of company purchases that simply didn’t exist.”
“The sentencing of Mr Zhang, shows that no matter where you are, we will find you and hold you accountable for your actions.”
The sentence included a non-parole period of six years and eight months and brought to an end one of the longest tax fraud investigations in Australia, Operation 4, which involved both the ATO and AFP.
Ms Hawkins said the attempted crime was a blatant fraud on the taxpayer.
“Tax crime affects the whole community. This was not an ordinary business operating legitimately – it was outright tax fraud. Mr Zhang undermined genuine businesses by heavily under-quoting, and he left business creditors and employees without their entitlements.”
“We are committed to ensuring the integrity of the tax and super system as well as levelling the playing field for businesses who do the right thing. Tax fraud also reduces the amount of revenue available to fund essential community services, like health and education.”
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