Retailers urged to be wary of alcohol fraud

13 December, 2019 by Brydie Allen

This week two Sydney men were arrested in relation to large scale customs fraud, allegedly smuggling alcohol worth an estimated $28 million.

The men were allegedly part of a criminal group that used a number of businesses to illicitly import, smuggle and export alcohol, making fraudulent claims under the Duty Drawback Scheme. This Scheme gives exporters refunds on customs duty paid for imported goods, where they will be treated, processed or incorporated into other goods for export, or are exported unused since importation.

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The Australian Federal Police (AFP) and Australian Border Force (ABF) have been investigating the matter since July, when they became suspicious of anomalies in the duty paid and claimed.

One of these was the lack of batch numbers on bottles, removed by the group to make the alcohol’s origin untraceable by customs officials. ABF Commissioner Michael Outram said this is something that retailers should look out for.

If a retailer has bought wholesale alcohol and found the batch numbers to be missing, they should contact the ABF immediately. Duty evasion, serious tax evasion and illegal importation are current priorities for the ABF and they urge anyone with information to come forward.

“We’re not going to come and seize the bottle off you by the way,” Commissioner Outram said in a press conference. “But we would like to know.”

While investigations around this particular group remain ongoing, it is estimated that the total cost defrauded could be in excess of several hundred million dollars.

Commissioner Outram said: “The individuals allegedly involved in this scam have not only been defrauding the Commonwealth of significant revenue, but also undercutting legitimate businesses involved in the alcohol trade, and ripping off consumers in the process.”

The Australian Tax Office (ATO) who supported the investigation, said it’s important that criminals like this are stopped to give legitimate businesses a chance to compete.

ATO Deputy Commissioner Will Day said: “The ATO is committed to combating illicit alcohol activities and ensuring there is a level playing field for businesses who do the right thing.”

The government is pleased with the outcome so far and gave reasons for why the community should be on the look out for similar suspicious behaviour.

Assistant Minister for Customers, Jason Wood, said: “The black economy penalises honest taxpayers, undermines the integrity of Australia’s tax and welfare systems and creates an uneven playing field for the majority of businesses that are doing the right thing.”

If anyone has information relating to this matter or other potential customs fraud, they are urged to report it to Border Watch online here. Information can be provided anonymously.