Queensland’s building industry watchdog, the Australian Taxation Office (ATO) and ASIC have joined forces in an educational offensive against illegal phoenixing in the building industry, a practice which causes significant harm to industry members.
Illegal phoenix activity is the evasion of tax and other responsibilities, such as employee entitlements, through the deliberate, systematic and sometimes repeated liquidation of related corporate trading entities.
The seminars follow the Special Joint Taskforce led by Justice John Byrne, which investigated illegal and fraudulent building activity in Queensland and referred 108 matters to relevant law enforcement authorities, including the ATO and ASIC.
The Queensland Building and Construction Commission (QBCC), the ATO and the Australian Securities and Investments Commission (ASIC) will co-host a series of free road shows for building industry members across the State, from tomorrow (19 August).
A 2018 report commissioned by the ATO, ASIC and the Fair Work Ombudsman estimates the annual impact of illegal phoenix activity across the Australian economy on businesses, employees and the government is between $2.85 billion and $5.13 billion.
QBCC Commissioner, Brett Bassett, said the three agencies were all members of the national Phoenix Taskforce but this was the first time they had combined their resources in this way.
“This is a strong indicator of the seriousness of this issue and our determination to combat it,” Mr Bassett said.
“In the building industry, illegal phoenixing hurts everyone from mum-and-dad businesses, to subcontractors and suppliers. These seminars will help members of our industry to identify and hopefully avoid the methods used by the unscrupulous individuals who engage in this behaviour.”
The QBCC’s presentation will outline how industry members can protect themselves against this issue, manage aged debtors and make sound business decisions.
The ATO will detail the costs of illegal phoenixing, the action being taken by regulators, provide examples and case studies, and explain how to report suspected illegal phoenixing.
ASIC will discuss practices that are characteristic of illegal phoenixing, indicators of financial distress that people should be wary of, and the role of pre-insolvency advisors in illegal phoenixing.
ASIC’s Executive Director, Assessment and Intelligence, Warren Day, said that ASIC’s presentation would also discuss proposed law reforms, including the introduction of company director ID numbers to better track the relationship between individuals and entities.
“This, and other proposed legislative changes, will add to the tool kit that regulators, such as ASIC, the ATO and the QBCC, are using to fight illegal phoenix activity,” Mr Day said.
The ATO has said that this problem is not confined to the building and construction industry but is a significant risk that is prevalent in that sector.
“The ATO uses sophisticated data-matching tools to identify, manage and monitor suspected illegal phoenix operators,” Assistant Commissioner Aislinn Walwyn said.
“We support businesses who want to do the right thing and we will deal firmly with those who choose to engage in phoenix behaviour.”
Representatives from the agencies will also participate in a panel-style question and answer session at the conclusion of their presentations.
The QBCC’s technical subject at the seminars will be metal roofing construction and the best practice methods for avoiding roofing defects.
Seminar information, including registration details, is available from the QBCC website. The first seminar will be held tomorrow (Monday 19 August) at Loganholme.
Article source: https://www.qbcc.qld.gov.au/media-releases/stay-clear-sharks-building-watchdog-unites-ato-asic
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