Friday, 27 April 2012

Gold Coast tycoon extradited to Sydney


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Gold Coast tycoon extradited to Sydney


April 26, 2012
One of the Gold Coast's richest men has been extradited to Sydney after being arrested on charges of running a $67 million tax evasion and money laundering scheme.


Michael Issakidis, 67, has been charged with conspiracy to deal in the proceeds of crime and conspiracy to dishonestly cause a loss to the Australian Taxation Office.


Issakidis, who was arrested by Australian Federal Police (AFP) officers at his lavish mansion on the Sovereign Islands on Tuesday, faces up to 25 years in jail if convicted.


The AFP alleges the Greek-born property developer and company director committed tax fraud through his medical company Neumedix, and funnelled company funds through offshore accounts.
Police have seized a collection of luxury cars including four Rolls Royces, a Lamborghini, an Aston Martin, a BMW and a Mercedes as well as two yachts, a waterfront mansion on the Gold Coast and a luxury property at Northbridge in Sydney.


The AFP says more arrests are possible.


Issakidis was flown out of the Gold Coast on Thursday afternoon and is expected to apply for bail when he appears in Sydney Central Local Court on Friday.


He recently successfully sued former friend and Wheel of Fortune host "Baby" John Burgess for $30,000 in back rent and costs for living in his 71st floor Gold Coast penthouse.



Today's raids followed a seven-month joint AFP and ATO Project Wickenby investigation and is the largest tax fraud probe since Wickenby was launched in 2006.


It will be alleged in court that through a complex unit trust structure, prices of Australian patents were over inflated once transferred offshore.


Corresponding depreciation expenses were then claimed and, as a result, a benefit of about $63 million was received over a three year period.


It will be further alleged these funds were then laundered through an account in the UK - and numerous accounts in Hong Kong - before being transferred back into Australia.


The scheme was identified by the ATO Trust taskforce, which was established to focus on arrangements to exploit perceived weaknesses in tax legislation for trusts.


Project Wickenby involves the ATO, AFP, Australian Crime Commission, Australian Securities and Investments Commission, Australian Government Solicitor, the Australian Transaction Reports and Analysis Centre and the Commonwealth Director of Public Prosecutions.


The proceeds of crime action was undertaken by the Commonwealth criminal assets confiscation Taskforce. The AFP-led taskforce brings together resources from the AFP, ATO and the ACC.


This is the first time the AFP has conducted the litigation to restrain assets on behalf of the taskforce since legislation came into effect in January this year giving the AFP the power to commence and conduct proceeds of crime litigation.




Mr Issakidis is the managing director of Queensland-based NeuMedix Health Group, a consortium of 16 investment and technology companies.


It will be alleged in court that through a complex unit trust structure, prices of Australian patents were over inflated once transferred offshore.


Corresponding depreciation expenses were then claimed and, as a result, a benefit of about $63 million was received over a three-year period.


It will be further alleged these funds were then laundered through an account in the UK - and numerous accounts in Hong Kong - before being transferred back into Australia.


The scheme was identified by the ATO Trust taskforce, which was established to focus on arrangements to exploit perceived weaknesses in tax legislation for trusts.


ATO Commissioner Michael D'Ascenzo today claimed the operation uncovered a serious abuse of the integrity of the tax system and serious tax evasion involving hundreds of millions of dollars.


"Parties who rely on tax driven deals to justify the commercial viability of business transactions are on notice that we will use our anti-avoidance rules to deal with such schemes,'' he said.


"The ATO will pursue all means available, including partnering with other law enforcement agencies, to respond firmly to these tax avoidance and evasion behaviours and protect the public revenue.''
AFP Commissioner Tony Negus said the operation combined the specialist skills of the AFP and the ATO to disrupt a complex money laundering scheme.


"Taking the profit out of crime is the aim of the criminal assets confiscation taskforce, which is targeting organised crime's deep pockets,'' he said today.


"This operation demonstrates the ongoing commitment by the AFP and its partner agencies to disrupt serious criminal activity.''


Mr Issakidis was expected to appear in the Southport Magistrates' Court today to face charges of:
  • Conspiracy to deal in the proceeds of crime of $1 million or more, contrary to Sections 400.3(1) and 11.5 of the Criminal Code Act 1995 - which carries a maximum jail term of 25 years.
  • Conspiracy to dishonestly cause a loss to a third person, namely the Australian Taxation Office, contrary to Sections 135.4(3) and 11.5 of the Criminal Code Act 1995 - which carries a maximum jail term of 10 years.

 

source: http://news.smh.com.au, http://www.heraldsun.com.au, http://www.goldcoast.com.au