Ross Greenwood: Reputations and jobs on the line as tax commissioner trades blows with Paul Hogan

Ross Greenwood: Reputations and jobs on the line as tax commissioner trades blows with Paul Hogan

This story starts with the largest attempted fraud on the Australian Tax Office.

The story now inexplicably includes Paul Hogan – Crocodile Dundee – former Australian of the Year, who was pursued by the Australian Tax Office (ATO) for more than six years for $150 million in taxes it alleged he owed. That case was settled five years ago.

It might end – depending on who’s right and who’s wrong – with the job of the most senior tax official in the land, ATO Commissioner Chris Jordan.

Here’s the background. Two weeks ago a company called Plutus Payroll and its directors and employees were raided by the Australian Federal Police as part of Operation Elbrus.

Plutus was created by a self-described fin-tech expert named Simon Anquetil. He was arrested and charged over the $165 million fraud. Among others charged was Adam Cranston, alleged to be one of the ring-leaders.

The alleged fraud was pretty basic. The company offered pay-roll services to contractors. It was supposed to pay wages, tax and super on their behalf. But the allegation is Plutus directors skimmed the tax they were supposed to have paid on behalf of others.

Those matters will eventually be heard in court.

The bomb-shell among the arrests and charges was that of Adam Cranston’s father, Michael Cranston. Michael Cranston is a deputy commissioner of the ATO and the most senior tax investigator in Australia. His pending charges – which result from allegations he made inquiries inside the ATO to discover his son’s situation – have also engulfed two other senior tax officials.

There is no secret this sent shock-waves through the tax office.

At the time of those arrests, I interviewed a number of people. One of those was Andrew Robinson from Robinson Legal – Paul Hogan’s lawyer. The reason is that Michael Cranston was the lead investigator for Operation Wickenby, which pursued Hogan for six years.

In that interview, Mr Robinson said Hogan was completely exonerated. But he also noted the terms of the settlement are the subject of strict confidentiality agreements.

Yesterday, for the first time since the Plutus Payroll raids and arrests occurred, Mr Jordan appeared in public. He fronted a Senate Estimates Committee and was grilled about the processes of the tax office and the specifics of Operation Elbrus (which inside the tax office was called Operation Crocodile).

Mr Jordan’s appearance was assured and measured, as you would expect of a professional of his standing. He said there was co-operation with the Australian Federal Police as the investigation unfolded; that no tax office files had been breached; that people could have confidence in the tax office and its administration.

He said Mr Cranston had committed a huge error of judgement.

But then Mr Jordan was asked a question by the National Senator John “Wacka” Williams. Wacka is one of the best politicians in the house. He’s tough, and can spot a story in a heart-beat. He spotted one this time.

Wacka started by asking if he knew of the interview between me and Hogan’s lawyer on my radio program Money News. Mr Jordan said he did, but that he disputed Mr Robinson’s version of events that Hogan was exonerated from the investigation.

As Wacka pressed further, Mr Jordan – who had the benefit of parliamentary privilege – inferred that Hogan paid tens of millions of dollars to have criminal charges relating to possible tax evasion charges dropped.

Though he spoke in generalities, his responses were interspersed with comments about Hogan. It was sometimes hard to separate them. Mr Jordan spoke about some people who pay tens of millions of dollars to make sure tax matters are settled. That charges are not pressed.

But those comments made Hogan white with anger. The tax office, you suspect, might not have known he was in Australia.

He came out swinging on my radio program last night, describing Mr Jordan as a “boofhead” and saying that he did not pay tens of millions of dollars to have tax evasion charges disappear – along with his tax liabilities.

In other words – to some degree or another – somebody is not telling the full story.

The problem here is that Hogan’s settlement with the tax office is the subject of a strict confidentiality agreement. Nobody can go into too much detail without breaching that agreement.

So a few things could happen from here. The Senate Economics Committee could seek to have Hogan’s settlement with the tax office tabled, under parliamentary privilege. I think that is most likely what will happen. I suspect Mr Robinson and Hogan would go one step further, and be willing to allow the documents to be released publicly.

Where that leaves the ATO Commissioner, remains to be seen. Was he right? Was Hogan right?

Reputation… and high profile jobs are almost certainly on the line.

Other previously published articles emphasising tax.

31-05-2017 9News: Paul Hogan and ATO stand off

31-05-2017 Ross Greenwood: Reputations and jobs on the line as tax commissioner trades blows with Paul Hogan

30-05-2017  I m going to extract revenge  – Paul Hogan

30-05-2017 ABA slams bank levy – Anna Bligh

30-05-2017 ATO Commissioner grilled at Senate Estimates

30-05-2017 Paul Hogan s lawyer reacts to ATO Commissioner Chris Jordan

30-05-2017 Treasurer Scott Morrison “Crackdown on Bank Execs”

29-05-2017 Money Minute – May 29 2017 Benefits Shake-Up

29-05-2017 Tax office to work with Plutus clients

23-05-2017 Money Minute – May 23 2017 “Maths Mistake”

22-05-2017 Inspector-General of Taxation: “I m ready to investigate the alleged tax fraud scandal if needed”

22-05-2017 Today Extra: “Many of these families are making money from having more children,”

22-05-2017 Westpac reveals the impact of the bank levy

19-05-2017 Money Minute – May 19 2017 “Tax Scandal”

19-05-2017 Newsletter – May 19th 2017

18-05-2017 David Coleman – Recommendations to come into effect after bank inquiry

18-05-2017 Paul Hogan s lawyer reacts to tax fraud

18-05-2017 Tax investigation:  I smelled a rat

18-05-2017 Treasurer Scott Morrison – “Let me tell you about Ken Henry…”

18-05-2017 Unprecedented! $165 million dollar tax fraud ring

16-05-2017 NAB Chairman Ken Henry wants an inquiry into the bank levy

13-05-2017 Ross Greenwood Newsletter 12 May 2017

12-05-2017 9News: CBA CEO hits back at bank tax

12-05-2017 Bank Tax War – CBA CEO Hits Back at Bank Tax

12-05-2017 Prime Minister Malcolm Turnbull

10-05-2017 9News: Budget reveals big taxes on banks

10-05-2017 Anna Bligh – Australian Bankers Association – Bank Levy

10-05-2017 Chris Bowen Shadow Treasurer

10-05-2017 Economic growth optimistic – Alan Oster NAB

10-05-2017 Jennifer Westacott – Business Council of Australia

10-05-2017 Mathias Cormann – Budget 2017

08-05-2017 Budget preview – Bob Deutsch

01-05-2017 Changes to Super are coming soon

01-05-2017 Housing affordability Gratton Insititute

Money Minute – May 31 2017 “Hogan Tax Brawl”

 

 

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