Database dump helps ATO close in on a tax haven rich list

More than 100 wealthy Australians, including some high-profile people, have netted tens of millions of dollars in ill-gotten gains through newly discovered links to a worldwide network of tax havens, the Tax Office claims.

More than 100 wealthy Australians, including some high-profile people, have netted tens of millions of dollars in ill-gotten gains through newly discovered links to a worldwide network of tax havens, the Tax Office claims.

Deputy commissioner of serious non-compliance Greg Williams said two Australians were under criminal investigation while 65 others had been identified as "high risk" because they had each moved more than $1 million in or out of the country without declaring the money in their tax returns.

The swoop is based on a database, obtained through the Tax Office's international information exchange network, of more than 2 million documents that show how thousands of people around the world use shell companies and trusts in Singapore, the British Virgin Islands, the Cayman Islands and the Cook Islands.

Mr Williams said he expected the number of offenders to grow as the Tax Office swapped intelligence with its US and British counterparts.

"The message I've been putting out in recent times is that you think you can be clever and hide and that you are invisible in this particular system because you're dealing in some kind of offshore arrangement," Mr Williams said. "The reality is that we are starting to see this and we can see you."

After sifting through the data, the Tax Office is investigating a company in Sydney that has claimed millions of dollars in tax deductions for interest expenses on offshore borrowings. The ATO says the loans are a sham because the offshore lender is actually controlled by the Australian company.

It has also launched an audit for a Melbourne man who claimed more than $25 million in share deals were carried out on behalf of offshore clients. The Tax Office believes the man was the real owner of the shares.

The Tax Office's database appears to be the same as the one held by former Fairfax Media journalist Gerard Ryle's International Consortium of Investigative Journalists, which has published a series of reports linking secret offshore structures to individuals, including a member of the Philippines Marcos dynasty, the deputy speaker of the Mongolian parliament and Brigitte Bardot's former playboy husband. It is believed the data is a complex mix of spreadsheets, emails and other documents that required the use of sophisticated software to analyse.

"It's our ability to then link that with Austrac [the government agency that tracks international money flows] data that really paints to full picture," the Tax Office assistant commissioner for economic crime, Paul Cheetham, said.

Mr Williams declined to detail how the Tax Office gained access to the database but said it was obtained within the past 18 months and did not come from the journalist consortium.

The Tax Office also has access to thousands of client records stolen by a former employee of Liechtenstein Group Trust, the wealth management arm of the European tax haven's royal family. Those records were used as part of its Wickenby inquiry into the use of tax havens by Australians, targets of which have included actor Paul Hogan and music promoter Glenn Wheatley.

Mr Williams said those exposed in the new database were not "the average person in the street".

He said there was an international groundswell building against tax evasion.

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