Alleged alcohol fraud: 'Hundreds of millions' in unpaid duty

Custom authorities have seized 800,000 bottles of alcohol from an alleged criminal syndicate that could potentially defraud the taxpayer of hundreds of millions of dollars. Fifteen properties were raided in Sydney and Melbourne on December 11 2019 by 200 Australian Border Force (ABF) and Australian Federal Police (AFP) officers. Luxury watches, cars, $1 million in cash plus alcohol were among items seized.

The alleged fraud involves a sophisticated plot to avoid paying duty on alcohol brought into the country and to fraudulently claim duty refunds on alcohol being exported.
Two Sydney men were charged with offences related to defrauding the taxpayer and more charges are expected.

The licence of a depot believed to be involved in the fraud has been cancelled. Depots work under strict regulations to securely store imported goods with unpaid duty.

At least $28 million has been rorted through the scheme, but the total amount could rise to "hundreds of millions" of dollars. Investigations began in July 2019 after anomalies in duty paid or claimed through the duty drawback scheme were flagged by officials. The alleged fraud not only robs the Australian Tax Office of revenue, but undercuts businesses who pay correct duty fees on imported and exported goods.

Some batch numbers had been removed from bottles to stop customs officials tracing their origin. Alcohol retailers are urged to contact ABF if they bought wholesale quantities of alcohol with batch numbers missing. These will not be seized but the ABF needs to be aware of the problem.