iscoverSuspected shadow economy activity across Darwin restaurants has led to the ATO and Fair Work Ombudsman conducting surprise site visits in an attempt to catch them in the act.
‘Cooking the books’: Darwin hospo businesses under ATO, FWO microscope
01 September 2025
•
8 minute read
The Tax Office and Fair Work Ombudsman have teamed up to perform surprise visits to food sector and hospitality businesses in Darwin following suspected reports of fraudulent activities.
As part of their investigation, codenamed Operation Sentinel, the ATO and FWO acted on valuable information and tip-offs received from the community and workers.
You’re out of free articles for this month
To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
Between 26 and 28 August, the regulators visited more than 30 businesses, including fast food outlets, restaurants and cafes, which were suspected to be engaged in shadow economy activities such as worker exploitation and alcohol excise avoidance.
The random visits were conducted to remind the businesses under investigation of their tax, super and employer obligations, with investigations set to continue.
Tony Goding, ATO assistant commissioner, said the joint actions in Darwin were driven by the Shadow Economy Taskforce, responsible for addressing and protecting the community from shadow economy behaviour.
“We’ve visited more than 30 businesses this week in Darwin who were suspected of unlawfully taking advantage of their workers and/or avoiding their tax and super obligations,” he said.
“Cooking the books by ripping off your workers and dodging your tax and super obligations doesn’t pass the pub test. Businesses that engage in the shadow economy are deliberately undercutting their competitors, gaining an unfair advantage over honest businesses doing the right thing and stealing from their employees’ futures. We will find out about it and take action.”
According to the ATO and the FWO, the 30 businesses visited were suspected of paying workers cash-in-hand to avoid legal obligations, paying employees’ wages below award rates and not paying their entitlements, under-reporting or omitting income, compliance issues with reporting and record-keeping, as well as avoiding alcohol excise obligations.
Goding noted it was important for the ATO to be wary of establishments attempting to operate outside the law by evading their excise and GST obligations with alcoholic beverages, as this allowed them to “undercut legitimate businesses, creating unfair competition and posing risks to public safety”.
FWO Anna Booth said her priority was protecting workers’ rights and holding food sector employers to account.
“Improving compliance in the fast food, restaurants and cafes industry is a priority for us, including protecting the sector’s many visa holders and young workers who are vulnerable,” she said.
“The Operation Sentinel investigations in Darwin are part of our efforts to ensure those who are doing the wrong thing are being found out and held to account. Fast food, restaurant and café workers with concerns about their pay or entitlements are urged to come forward to directly seek assistance.”
The regulators warned all Australian businesses of the “serious consequences” for non-compliance including fines and penalties for businesses that engaged in shadow economy behaviours at the expense of their employees.
“If you run a business, don’t think you can get away with exploiting your workers or ripping off the community, as we have a range of sophisticated measures to uncover shadow economy activities. We also work closely with our partner agencies like the FWO to catch those doing the wrong thing.”
You need to be a member to post comments. Become a member for free today!
