Australia Investigating Major Tax Crimes as Part of Crypto-Focused Tax Enforcement Taskforce

Australia’s tax agency, the Australian Tax Office (ATO), is investigating 12 major international tax avoidance schemes, with a key focus on cryptocurrency-enabled activities. The news was reported by local broadsheet The Sydney Morning Herald on June 6.

The ATO’s intensified cross-border investigations were reportedly revealed following a meeting of the J5 — also known as “The Joint Chiefs of Global Tax Enforcement.”

As previously reported, the J5 is an international taskforce of tax enforcement authorities from Australia, Canada, the Netherlands, the United Kingdom and the United States. It was established in July 2018 in a bid to tackle cryptocurrency- and cybercrime-related risks, in particular their role in transnational tax crimes and money laundering.

According to The Sydney Morning Herald, the latest J5 meeting revealed the coalition was intensively sharing data to pursue 60 global investigations, with the ATO reportedly directly involved in 12.

ATO deputy commissioner Will Day has reportedly revealed that at least one of the investigations involves a global financial institution and its intermediaries, which is believed to have helped clients conceal assets and income data. In his statement, Day singled out the risks posed by cryptocurrencies in particular, noting that:

“We're seeing the use of cryptocurrencies in ways that we haven't seen before. At the Australian level, there is definitely legitimate use for investment in cryptocurrencies, but we're also seeing the use of them to facilitate tax crimes."

The J5’s cooperation has reportedly enabled more organized and intensive data exchange and analysis across borders. The Sydney Morning Herald reports that the Dutch tax authorities recently shuttered a crypto mixer due to the combined efforts of the J5 members.

Day emphasized that the taskforce’s activities means that “at no other time have criminals been at greater risk of being caught.”

As reported earlier this spring, the ATO has revealed it is seeking to contact crypto traders personally about tax issues as part of a new data collection scheme.

In conjunction with the Australian Securities and Investment Commission and the Australian Transaction Reports and Analysis Centre, the agency is identifying crypto traders using data sourced from domestic cryptocurrency exchanges.