1 00:00:00,020 --> 00:00:02,060 (THEME MUSIC PLAYS) 2 00:00:23,620 --> 00:00:26,260 PAUL FARRELL: Inside a well-known Sydney strip club 3 00:00:26,260 --> 00:00:26,500 PAUL FARRELL: a plan is about to be hatched. 4 00:00:26,500 --> 00:00:28,260 a plan is about to be hatched. 5 00:00:36,140 --> 00:00:37,900 SONG: # Oh, na, na, na 6 00:00:37,900 --> 00:00:39,220 # Oh, na, na, na 7 00:00:40,180 --> 00:00:42,900 # Oh, na, na, na Oh, na, na, na 8 00:00:42,900 --> 00:00:44,740 # I got the rock # I got the rock 9 00:00:44,740 --> 00:00:46,780 # I got the sauce # I got that sauce 10 00:00:46,780 --> 00:00:47,860 # I got that drip... # 11 00:00:47,860 --> 00:00:49,980 CLINTON FREE: It starts with a meeting of five men 12 00:00:49,980 --> 00:00:53,940 at Men's Gallery, a strip joint in Pitt Street in Sydney. 13 00:00:53,940 --> 00:00:55,860 # Stayin' lit # Stayin' lit 14 00:00:55,860 --> 00:00:57,860 # Yeah, till I drop # Drop, drop... # 15 00:00:57,860 --> 00:00:58,100 # Yeah, till I drop They're plotting a new business 16 00:00:58,100 --> 00:00:59,740 They're plotting a new business 17 00:00:59,740 --> 00:00:59,980 that's going to make them They're plotting a new business 18 00:00:59,980 --> 00:01:02,860 that's going to make them more than $100 million. 19 00:01:03,820 --> 00:01:08,580 That business is a scam to rip off the Australian Taxation Office. 20 00:01:10,140 --> 00:01:13,900 They name it after the Greek god of wealth, Plutus. 21 00:01:15,860 --> 00:01:19,380 There were Porsches, there were BMWs, there was an aircraft. 22 00:01:19,380 --> 00:01:22,260 This was a massive amount of money flowing around. 23 00:01:24,420 --> 00:01:28,420 Plutus will become the biggest tax fraud in Australia's history. 24 00:01:30,820 --> 00:01:33,060 It's easy to say ripping off the tax system, 25 00:01:33,060 --> 00:01:35,780 but they're ripping off everyday Australians. 26 00:01:38,140 --> 00:01:40,500 With 28,000 pages of evidence 27 00:01:40,500 --> 00:01:43,420 and 70 hours of police surveillance recordings 28 00:01:43,420 --> 00:01:45,660 never before heard outside a courtroom, 29 00:01:45,660 --> 00:01:48,660 Four Corners brings you the story of how they did it... 30 00:01:54,900 --> 00:01:57,100 ..and how it was brought down. 31 00:02:16,980 --> 00:02:19,580 SONG: # Shake that Shake that ass for some paper 32 00:02:19,580 --> 00:02:20,900 # For some paper, paper 33 00:02:20,900 --> 00:02:23,540 # Make that, make that cash... # 34 00:02:24,500 --> 00:02:28,220 It's 2014 and it's lunchtime at the Men's Gallery. 35 00:02:28,220 --> 00:02:31,380 # I'm gonna get that bag either way... # 36 00:02:31,380 --> 00:02:34,420 From the outset their intent is clear. 37 00:02:34,420 --> 00:02:38,980 One of the men hands out new phones they'll use to cover their tracks. 38 00:02:41,820 --> 00:02:44,060 JOHN COYNE: So, phones that are not linked to them, 39 00:02:44,060 --> 00:02:44,300 JOHN COYNE: So, phones with all new numbers. 40 00:02:44,300 --> 00:02:45,540 with all new numbers. 41 00:02:45,540 --> 00:02:45,780 It's an old form with all new numbers. 42 00:02:45,780 --> 00:02:49,020 It's an old form of trying to evade detection. 43 00:02:49,020 --> 00:02:51,540 It really goes to the heart of their criminal enterprise. 44 00:02:51,540 --> 00:02:51,780 It shows that they most definitely It really goes to the heart of their criminal enterprise. 45 00:02:51,780 --> 00:02:55,100 It shows that they most definitely 46 00:02:55,100 --> 00:02:56,780 knew that they were going to 47 00:02:56,780 --> 00:02:58,900 undertake a criminal activity. 48 00:03:00,340 --> 00:03:02,540 This man is Adam Cranston, 49 00:03:02,540 --> 00:03:04,980 a 27-year-old corporate player 50 00:03:04,980 --> 00:03:05,220 experienced a 27-year-old corporate player 51 00:03:05,220 --> 00:03:08,500 experienced in cleaning up broken businesses. 52 00:03:08,500 --> 00:03:13,700 He also has a love of fast cars and a surprising family connection. 53 00:03:15,260 --> 00:03:17,500 So, Adam Cranston was raised in the Sutherland Shire 54 00:03:17,500 --> 00:03:17,740 So, Adam Cranston was raised in a fairly privileged family. 55 00:03:17,740 --> 00:03:18,980 in a fairly privileged family. 56 00:03:18,980 --> 00:03:20,500 And then entered the work force 57 00:03:20,500 --> 00:03:22,980 working as a consultant to insolvent companies. 58 00:03:22,980 --> 00:03:26,100 Notably, he was the son of Michael Cranston, 59 00:03:26,100 --> 00:03:28,140 the Deputy Commissioner of the ATO. 60 00:03:29,820 --> 00:03:33,620 Also present at the meeting that day is Jay Onley, 61 00:03:33,620 --> 00:03:35,060 a former pro snowboarder 62 00:03:35,060 --> 00:03:39,300 and a risk-taker who's an expert in business turnaround. 63 00:03:41,620 --> 00:03:43,820 Then there's Simon Anquetil, 64 00:03:43,820 --> 00:03:46,940 an entrepreneur who brings the building blocks of the scheme. 65 00:03:49,500 --> 00:03:51,420 And IT recruiter Josh Kitson, 66 00:03:51,420 --> 00:03:53,900 who will soon be installed as the front man, 67 00:03:53,900 --> 00:03:56,140 the company's general manager. 68 00:03:56,940 --> 00:03:59,940 Simon Anquetil is a tech entrepreneur 69 00:03:59,940 --> 00:04:02,340 and someone who was deeply interested in startups. 70 00:04:02,340 --> 00:04:05,140 He was previously the managing director of a company 71 00:04:05,140 --> 00:04:05,380 He was previously that had gone into liquidation, 72 00:04:05,380 --> 00:04:06,860 that had gone into liquidation, 73 00:04:06,860 --> 00:04:07,100 and it appears a strong patron that had gone into liquidation, 74 00:04:07,100 --> 00:04:11,380 and it appears a strong patron of gentleman's clubs. 75 00:04:11,380 --> 00:04:14,580 Josh Kitson was one of Simon Anquetil's best friends 76 00:04:14,580 --> 00:04:20,060 and he was very effective in recruiting clients into the business 77 00:04:20,060 --> 00:04:20,300 and he was very effective in and was effectively running it. 78 00:04:20,300 --> 00:04:22,540 and was effectively running it. 79 00:04:25,100 --> 00:04:27,540 Their plan is to set up a payroll company 80 00:04:27,540 --> 00:04:31,100 that processes wages on behalf of other businesses. 81 00:04:32,540 --> 00:04:34,540 They'll rake in clients' money, 82 00:04:34,540 --> 00:04:37,380 but instead of paying the tax they owe to the government 83 00:04:37,380 --> 00:04:38,660 they'll just keep it. 84 00:04:44,460 --> 00:04:46,460 The Men's Gallery meeting ends 85 00:04:46,460 --> 00:04:50,980 and, afterwards, Anquetil and Kitson exchange a flurry of texts. 86 00:05:05,980 --> 00:05:07,900 It's the bare bones of a scheme 87 00:05:07,900 --> 00:05:11,220 that will soon morph into something much bigger. 88 00:05:22,380 --> 00:05:26,460 So, Plutus was itself set up to be a squeaky-clean company. 89 00:05:26,460 --> 00:05:26,700 So, Plutus was itself set up Its employees weren't aware 90 00:05:26,700 --> 00:05:27,980 Its employees weren't aware 91 00:05:27,980 --> 00:05:30,740 of what was going on underneath the business, 92 00:05:30,740 --> 00:05:32,300 and it certainly was operating 93 00:05:32,300 --> 00:05:35,260 for all intents and purposes in a legitimate way. 94 00:05:46,140 --> 00:05:50,860 They set up shop in the elite harbourside suburb of Double Bay. 95 00:05:54,700 --> 00:05:58,980 Plutus Payroll aggressively targets big corporate and government clients 96 00:05:58,980 --> 00:06:02,580 that contract Plutus to manage their staff's wages. 97 00:06:05,820 --> 00:06:07,300 Plutus billed itself 98 00:06:07,300 --> 00:06:11,460 as Australia's only zero-fee outsourced payroll service. 99 00:06:11,460 --> 00:06:14,620 So, it really undercut the market quite heavily 100 00:06:14,620 --> 00:06:18,940 and it was quite successful in its little niche around IT contractors. 101 00:06:23,180 --> 00:06:27,140 Within a year the syndicate steals more than $4 million. 102 00:06:28,940 --> 00:06:31,620 This is how the scam works - 103 00:06:31,620 --> 00:06:31,860 Plutus processes the gross wages This is how the scam works - 104 00:06:31,860 --> 00:06:34,660 Plutus processes the gross wages from legitimate clients 105 00:06:34,660 --> 00:06:34,900 Plutus processes the gross wages through a layer of companies 106 00:06:34,900 --> 00:06:36,140 through a layer of companies 107 00:06:36,140 --> 00:06:37,900 that sit beneath it. 108 00:06:37,900 --> 00:06:38,140 On paper they appear to be run that sit beneath it. 109 00:06:38,140 --> 00:06:41,340 On paper they appear to be run by a series of front people, 110 00:06:41,340 --> 00:06:41,580 On paper they appear to be run or dummy directors, 111 00:06:41,580 --> 00:06:42,820 or dummy directors, 112 00:06:42,820 --> 00:06:46,700 but in reality the syndicate is in control. 113 00:06:46,700 --> 00:06:49,300 While these second-tier companies do pay wages, 114 00:06:49,300 --> 00:06:53,260 they only pay a small portion of the tax they owe. 115 00:06:53,260 --> 00:06:56,140 The syndicate steals the rest of the money. 116 00:06:56,140 --> 00:06:59,660 Periodically they dump these companies, dodging the tax debts, 117 00:06:59,660 --> 00:06:59,900 Periodically they dump these and start again with new companies. 118 00:06:59,900 --> 00:07:02,620 and start again with new companies. 119 00:07:03,660 --> 00:07:05,420 MICHAEL HAYTER: Australian Taxation Office 120 00:07:05,420 --> 00:07:07,660 takes a number of months or sometimes years 121 00:07:07,660 --> 00:07:11,220 to catch onto the fact that the tax hasn't been paid, 122 00:07:11,220 --> 00:07:11,460 to catch onto the fact so, they have some breathing space. 123 00:07:11,460 --> 00:07:13,140 so, they have some breathing space. 124 00:07:13,140 --> 00:07:13,380 So, they used that breathing space to take the monies so, they have some breathing space. 125 00:07:13,380 --> 00:07:16,260 So, they used that breathing space to take the monies 126 00:07:16,260 --> 00:07:19,260 which the Australian Taxation Office would've been entitled 127 00:07:19,260 --> 00:07:21,820 and redirect them into various other companies. 128 00:07:21,820 --> 00:07:22,100 and redirect them into various other companies. So, by the time the Australian Taxation Office 129 00:07:22,100 --> 00:07:23,820 So, by the time the Australian Taxation Office 130 00:07:23,820 --> 00:07:24,060 So, by the time chases them for the monies, 131 00:07:24,060 --> 00:07:26,300 chases them for the monies, 132 00:07:26,300 --> 00:07:27,900 the monies have already gone, 133 00:07:27,900 --> 00:07:29,780 and then they've moved on to another company 134 00:07:29,780 --> 00:07:30,020 and then they've moved on to implement the same scheme. 135 00:07:30,020 --> 00:07:31,340 to implement the same scheme. 136 00:07:31,340 --> 00:07:31,580 And they started just moving these amounts of money to implement the same scheme. 137 00:07:31,580 --> 00:07:34,900 And they started just moving these amounts of money 138 00:07:34,900 --> 00:07:35,140 And they started in broken-up amounts 139 00:07:35,140 --> 00:07:37,820 in broken-up amounts 140 00:07:37,820 --> 00:07:39,780 into these different companies 141 00:07:39,780 --> 00:07:39,980 into these different companies and then into various bank accounts. 142 00:07:39,980 --> 00:07:42,220 and then into various bank accounts. 143 00:07:42,220 --> 00:07:45,220 And it just kept going through this really complex path 144 00:07:45,220 --> 00:07:48,260 of going from company to bank account to company 145 00:07:48,260 --> 00:07:51,780 and then eventually back into the bank accounts 146 00:07:51,780 --> 00:07:52,020 and then eventually of the people involved. 147 00:07:52,020 --> 00:07:53,500 of the people involved. 148 00:07:56,940 --> 00:08:01,220 Simon Anquetil has experience running a scheme very similar to this 149 00:08:01,220 --> 00:08:03,900 on a much smaller scale. 150 00:08:03,900 --> 00:08:04,140 MICHAEL HAYTER: on a much smaller scale. 151 00:08:04,140 --> 00:08:06,060 MICHAEL HAYTER: These people don't overnight 152 00:08:06,060 --> 00:08:08,060 decide to do a hundred-million-dollar fraud. 153 00:08:08,060 --> 00:08:13,380 Their conduct prior to that is on the dark side. 154 00:08:13,380 --> 00:08:15,380 And Simon Anquetil was on the dark side? 155 00:08:15,380 --> 00:08:17,980 He was on the dark side, yeah. Yeah, yeah. 156 00:08:19,220 --> 00:08:21,900 Lawyer Michael Hayter examined Anquetil 157 00:08:21,900 --> 00:08:22,140 Lawyer Michael Hayter over suspected credit card fraud 158 00:08:22,140 --> 00:08:23,820 over suspected credit card fraud 159 00:08:23,820 --> 00:08:24,060 during liquidation proceedings over suspected credit card fraud 160 00:08:24,060 --> 00:08:26,500 during liquidation proceedings in 2012. 161 00:08:26,500 --> 00:08:30,140 A small company called eStrategy Group had gone bust, 162 00:08:30,140 --> 00:08:34,540 owing more than $100,000 in tax to the ATO. 163 00:08:34,540 --> 00:08:35,860 He would use these credit cards 164 00:08:35,860 --> 00:08:39,020 to go to the strip clubs for so-called business expenses. 165 00:08:39,020 --> 00:08:39,260 to go to the strip clubs When I cross examined him about it 166 00:08:39,260 --> 00:08:40,940 When I cross examined him about it 167 00:08:40,940 --> 00:08:41,180 he said he was taking prospective When I cross examined him about it 168 00:08:41,180 --> 00:08:45,460 he said he was taking prospective clients to those strip clubs. 169 00:08:45,460 --> 00:08:51,780 Sometimes he was spending $8,000 to $12,000 a day at those strip clubs 170 00:08:51,780 --> 00:08:55,340 and sometimes on consecutive days. 171 00:08:55,340 --> 00:08:57,900 That doesn't sound like a legitimate business expense. 172 00:08:57,900 --> 00:09:00,420 (LAUGHS) No. No, it doesn't. It doesn't. And it's not. 173 00:09:02,420 --> 00:09:03,940 Liquidator Bruce Gleeson 174 00:09:03,940 --> 00:09:07,460 believes Anquetil had installed a dummy director at eStrategy Group 175 00:09:07,460 --> 00:09:10,580 and was the true mastermind of the company. 176 00:09:10,580 --> 00:09:14,500 Gleeson submitted a report to the corporate regulator, ASIC, 177 00:09:14,500 --> 00:09:16,740 but no further action was taken. 178 00:09:16,740 --> 00:09:20,340 The difficulty always is that, 179 00:09:20,340 --> 00:09:20,580 when something like eStrategy happens The difficulty always is that, 180 00:09:20,580 --> 00:09:23,100 when something like eStrategy happens 181 00:09:23,100 --> 00:09:27,340 and then they can see that the consequence is not... 182 00:09:28,300 --> 00:09:29,780 ..significant, 183 00:09:29,780 --> 00:09:32,540 then it's...it's... 184 00:09:32,540 --> 00:09:36,380 ..particularly to unscrupulous business operators, 185 00:09:36,380 --> 00:09:38,420 there's then the ability for them to say, 186 00:09:38,420 --> 00:09:38,660 there's then the ability "How can we take advantage of this?" 187 00:09:38,660 --> 00:09:40,460 "How can we take advantage of this?" 188 00:09:40,460 --> 00:09:44,860 I think what we've seen, regrettably, in the Plutus matter 189 00:09:44,860 --> 00:09:46,620 is that ... 190 00:09:46,620 --> 00:09:48,620 ..almost you could say 191 00:09:48,620 --> 00:09:53,420 eStrategy Group was a trial run for a bigger event, 192 00:09:53,420 --> 00:09:53,660 eStrategy Group was a trial run and a much bigger event at that. 193 00:09:53,660 --> 00:09:56,740 and a much bigger event at that. 194 00:09:56,740 --> 00:09:56,940 If the punishment for getting caught and a much bigger event at that. 195 00:09:56,940 --> 00:09:58,780 If the punishment for getting caught 196 00:09:58,780 --> 00:10:00,460 isn't significant, 197 00:10:00,460 --> 00:10:02,580 they get a feeling, a sense of ego 198 00:10:02,580 --> 00:10:04,100 that, "OK, I've learned 199 00:10:04,100 --> 00:10:04,300 that, "OK, I've learned "from this experience. 200 00:10:04,300 --> 00:10:05,580 "from this experience. 201 00:10:05,580 --> 00:10:08,100 "Next time I do this I'm going to be better at it." 202 00:10:13,460 --> 00:10:15,180 As their confidence grows 203 00:10:15,180 --> 00:10:17,660 so does the Plutus scheme. 204 00:10:18,620 --> 00:10:20,180 By the end of 2015 205 00:10:20,180 --> 00:10:22,660 Adam Cranston and his business partners 206 00:10:22,660 --> 00:10:24,900 are living large and spending big. 207 00:10:31,940 --> 00:10:35,340 There were Porsches, there were BMWs, there was an aircraft. 208 00:10:37,500 --> 00:10:39,900 Some of it just went into their bank accounts, 209 00:10:39,900 --> 00:10:40,140 Some of it padded their bank accounts. 210 00:10:40,140 --> 00:10:41,500 padded their bank accounts. 211 00:10:41,500 --> 00:10:41,740 Real estate. padded their bank accounts. 212 00:10:41,740 --> 00:10:43,740 Real estate. Real estate was a big one. 213 00:10:43,740 --> 00:10:44,020 Real estate. Real estate was a big one. Flashy assets - cars, planes, houses. 214 00:10:44,020 --> 00:10:46,740 Flashy assets - cars, planes, houses. 215 00:10:46,740 --> 00:10:46,980 Flashy assets - He was living far beyond his means, 216 00:10:46,980 --> 00:10:49,220 He was living far beyond his means, 217 00:10:49,220 --> 00:10:51,180 and that is a very common indicator 218 00:10:51,180 --> 00:10:57,020 that somebody is involved in something that is illicit, illegal. 219 00:10:59,540 --> 00:11:04,980 By May 2016 they've embezzled almost $50 million from the Tax Office. 220 00:11:04,980 --> 00:11:08,740 And all that cash begins to attract attention. 221 00:11:10,220 --> 00:11:11,700 JOHN COYNE: In many cases 222 00:11:11,700 --> 00:11:11,940 people who have successful JOHN COYNE: In many cases 223 00:11:11,940 --> 00:11:14,180 people who have successful criminal enterprises 224 00:11:14,180 --> 00:11:17,940 can't help themselves but share that information with others. 225 00:11:17,940 --> 00:11:20,940 And over time there's a degree of arrogance with that. 226 00:11:20,940 --> 00:11:23,460 And once that knowledge gets out there 227 00:11:23,460 --> 00:11:25,900 it spreads relatively quickly. 228 00:11:28,340 --> 00:11:31,540 At this point the AFP, acting on a tip-off, 229 00:11:31,540 --> 00:11:35,100 launches a large-scale covert surveillance operation 230 00:11:35,100 --> 00:11:37,340 involving up to 20 police investigators. 231 00:11:39,860 --> 00:11:43,300 This is one of their early recorded phone conversations. 232 00:11:43,300 --> 00:11:43,540 (PHONE LINE RINGS) This is one of their early recorded phone conversations. 233 00:11:43,540 --> 00:11:45,300 (PHONE LINE RINGS) 234 00:11:56,140 --> 00:11:59,700 It's October, just after Adam Cranston's wedding, 235 00:11:59,700 --> 00:12:03,860 and he has no idea the police are listening to every word. 236 00:12:03,860 --> 00:12:07,620 RECORDING: Yeah, no, it was good. That was epic. And it was Jay... 237 00:12:07,620 --> 00:12:12,300 By now the syndicate has pocketed around $70 million in unpaid tax, 238 00:12:12,300 --> 00:12:16,020 and the conversation reveals that there is much more going on. 239 00:12:26,940 --> 00:12:29,660 It's one of more than 450 recordings 240 00:12:29,660 --> 00:12:32,420 later used as evidence against them in court. 241 00:12:32,420 --> 00:12:34,940 RECORDING: My thoughts are we keep what he does external for this... 242 00:12:34,940 --> 00:12:38,140 JOHN COYNE: Look, they must have had something very, very significant 243 00:12:38,140 --> 00:12:40,660 in terms of initiating the investigation 244 00:12:40,660 --> 00:12:42,660 and through the quick assessment process 245 00:12:42,660 --> 00:12:46,540 in order to get telephone intercepts so early in the process 246 00:12:46,540 --> 00:12:46,780 in order to get telephone intercepts or so early in the investigation. 247 00:12:46,780 --> 00:12:48,660 or so early in the investigation. 248 00:12:48,660 --> 00:12:50,140 So, it sends a clear message 249 00:12:50,140 --> 00:12:52,660 that, from the very start, 250 00:12:52,660 --> 00:12:56,100 the officers involved, the investigators and AFP, 251 00:12:56,100 --> 00:12:58,460 corporately saw that this investigation 252 00:12:58,460 --> 00:12:58,700 corporately saw had significant dimensions to it. 253 00:12:58,700 --> 00:13:02,100 had significant dimensions to it. 254 00:13:02,100 --> 00:13:04,900 Now, at that time, it could be significant 255 00:13:04,900 --> 00:13:08,260 in terms of the linkages it has to other organised crime, 256 00:13:08,260 --> 00:13:08,500 in terms of the linkages the amount of money involved, 257 00:13:08,500 --> 00:13:10,740 the amount of money involved, 258 00:13:10,740 --> 00:13:13,100 the sophistication of the operation. 259 00:13:14,780 --> 00:13:16,660 By November 2016 260 00:13:16,660 --> 00:13:16,900 Adam has bought himself By November 2016 261 00:13:16,900 --> 00:13:19,140 Adam has bought himself a new holiday house 262 00:13:19,140 --> 00:13:22,620 and a third car, his second Porsche. 263 00:13:25,780 --> 00:13:27,540 The business is humming along, 264 00:13:27,540 --> 00:13:30,380 but beneath the surface tensions are brewing. 265 00:13:30,380 --> 00:13:34,660 Jay Onley feels like he isn't getting a decent cut of the cash. 266 00:13:45,060 --> 00:13:48,180 In late November Adam and Jay put on an event 267 00:13:48,180 --> 00:13:52,500 at this exclusive private racetrack on the New South Wales Central Coast 268 00:13:52,500 --> 00:13:56,540 with associates of one of their companies, Synep. 269 00:13:56,540 --> 00:13:58,500 (ENGINE WHIZZES) 270 00:13:58,500 --> 00:14:04,300 (ENGINES ROAR) 271 00:14:04,300 --> 00:14:06,740 (INDISTINCT CHATTER) 272 00:14:06,740 --> 00:14:06,980 Any final words, (INDISTINCT CHATTER) 273 00:14:06,980 --> 00:14:08,980 Any final words, in the passenger seat? 274 00:14:08,980 --> 00:14:10,500 No. Good luck. 275 00:14:13,540 --> 00:14:16,700 I got my lap dance. (LAUGHS) 276 00:14:32,460 --> 00:14:34,340 (LAUGHTER) Now squat! 277 00:14:34,340 --> 00:14:34,580 (LAUGHTER) (LAUGHTER) 278 00:14:34,580 --> 00:14:35,740 (LAUGHTER) 279 00:14:35,740 --> 00:14:36,940 Oh, no. 280 00:14:36,940 --> 00:14:38,220 Argh! 281 00:14:38,220 --> 00:14:39,220 (SCREAMS) 282 00:14:39,220 --> 00:14:42,700 Adam recounts a conversation with an acquaintance, 283 00:14:42,700 --> 00:14:45,220 who clocks their lavish spending. 284 00:15:09,580 --> 00:15:11,060 Unexplained wealth 285 00:15:11,060 --> 00:15:11,300 is when people, essentially, Unexplained wealth 286 00:15:11,300 --> 00:15:16,060 is when people, essentially, are living beyond their means. 287 00:15:16,060 --> 00:15:16,340 So, someone working for a payroll company is when people, essentially, are living beyond their means. 288 00:15:16,340 --> 00:15:19,740 So, someone working for a payroll company 289 00:15:19,740 --> 00:15:19,980 So, someone probably isn't making, you know, 290 00:15:19,980 --> 00:15:22,580 probably isn't making, you know, 291 00:15:22,580 --> 00:15:22,780 probably isn't making, you know, $100 million a year 292 00:15:22,780 --> 00:15:24,780 $100 million a year 293 00:15:24,780 --> 00:15:29,340 and able to buy things like multi-million-dollar homes 294 00:15:29,340 --> 00:15:32,180 and fancy vehicles and aeroplanes and boats. 295 00:15:32,180 --> 00:15:35,700 So, to break down the word, it IS unexplained wealth - 296 00:15:35,700 --> 00:15:39,020 "Where did this money come from? How did this person get the money?" 297 00:15:42,340 --> 00:15:44,140 To keep the scam going 298 00:15:44,140 --> 00:15:47,660 they're relying on a network of professional facilitators. 299 00:15:47,660 --> 00:15:49,660 The court will ultimately hear 300 00:15:49,660 --> 00:15:52,580 the syndicate used so-called 'friendly liquidators' 301 00:15:52,580 --> 00:15:52,820 the syndicate used to keep the scheme under the radar. 302 00:15:52,820 --> 00:15:55,220 to keep the scheme under the radar. 303 00:15:58,340 --> 00:16:02,660 Liquidators have a very significant position of trust in the economy. 304 00:16:02,660 --> 00:16:05,180 Their role is quasi-judicial in some ways 305 00:16:05,180 --> 00:16:05,460 Their role is quasi-judicial in some ways and they are empowered to make very significant decisions. 306 00:16:05,460 --> 00:16:08,660 and they are empowered to make very significant decisions. 307 00:16:08,660 --> 00:16:08,900 and they are empowered So, for example, they can decide 308 00:16:08,900 --> 00:16:10,540 So, for example, they can decide 309 00:16:10,540 --> 00:16:13,060 whether or not a debt is legitimate or not. 310 00:16:13,060 --> 00:16:16,660 A friendly liquidator, in their description, 311 00:16:16,660 --> 00:16:19,340 is somebody who will either look the other way 312 00:16:19,340 --> 00:16:22,180 or facilitate the process that goes on. 313 00:16:22,180 --> 00:16:23,940 If either of those things are occurring, 314 00:16:23,940 --> 00:16:27,660 it should be pretty evident to the regulator what's actually happening. 315 00:16:27,660 --> 00:16:27,900 This is all about vulnerabilities. it should be pretty evident to the regulator what's actually happening. 316 00:16:27,900 --> 00:16:29,820 This is all about vulnerabilities. 317 00:16:29,820 --> 00:16:30,060 It's about criminal groups This is all about vulnerabilities. 318 00:16:30,060 --> 00:16:32,300 It's about criminal groups trying to exploit 319 00:16:32,300 --> 00:16:35,060 real and what they perceive as vulnerabilities in the systems 320 00:16:35,060 --> 00:16:35,340 real and what they perceive as vulnerabilities in the systems to make money and to avoid detection. 321 00:16:35,340 --> 00:16:37,660 to make money and to avoid detection. 322 00:16:41,100 --> 00:16:43,300 Police will later intercept a meeting 323 00:16:43,300 --> 00:16:45,220 where Menon, Onley and Adam Cranston 324 00:16:45,220 --> 00:16:46,540 are discussing the liquidation 325 00:16:46,540 --> 00:16:49,020 of another of their associated companies. 326 00:16:49,020 --> 00:16:53,300 The conversation turns to how they will pay the liquidator. 327 00:17:16,580 --> 00:17:21,220 If there's cash payments being given to a dodgy liquidator, 328 00:17:21,220 --> 00:17:23,740 that's about as egregious as it gets in this profession. 329 00:17:23,740 --> 00:17:23,980 that's about as egregious They certainly shouldn't be allowed 330 00:17:23,980 --> 00:17:25,260 They certainly shouldn't be allowed 331 00:17:25,260 --> 00:17:28,020 to continue operating in this marketplace. 332 00:17:28,020 --> 00:17:31,140 And it defies explanation in my mind 333 00:17:31,140 --> 00:17:35,260 as to how that person hasn't been tracked down and held to account. 334 00:17:36,220 --> 00:17:39,740 John Winter runs Australia's peak body for insolvency experts, 335 00:17:39,740 --> 00:17:43,060 and believes the corporate regulator, ASIC, hasn't looked hard enough 336 00:17:43,060 --> 00:17:46,860 at the liquidation of Plutus Payroll's second-tier companies. 337 00:17:48,860 --> 00:17:50,420 The evidence has been given 338 00:17:50,420 --> 00:17:50,660 that there were friendly liquidators The evidence has been given 339 00:17:50,660 --> 00:17:52,660 that there were friendly liquidators attached to it. 340 00:17:52,660 --> 00:17:52,900 that there were friendly liquidators It's not that hard for the regulator 341 00:17:52,900 --> 00:17:55,140 It's not that hard for the regulator 342 00:17:55,140 --> 00:17:56,900 to line up who was doing the work 343 00:17:56,900 --> 00:17:57,140 and start a proper investigation to line up who was doing the work 344 00:17:57,140 --> 00:17:59,420 and start a proper investigation into those. 345 00:17:59,420 --> 00:18:01,540 We've seen no evidence of that happening. 346 00:18:04,340 --> 00:18:05,900 ASIC told Four Corners 347 00:18:05,900 --> 00:18:09,580 that it engaged with and assisted the AFP with its investigation. 348 00:18:09,580 --> 00:18:12,140 It did not answer our specific questions 349 00:18:12,140 --> 00:18:14,460 about friendly liquidators linked to the scam, 350 00:18:14,460 --> 00:18:17,500 but conceded that it can only undertake a fraction 351 00:18:17,500 --> 00:18:21,380 of the potential regulatory and enforcement action it identifies. 352 00:18:27,140 --> 00:18:30,180 Police know they need to gather more evidence. 353 00:18:30,180 --> 00:18:32,980 They need more than just phone intercepts. 354 00:18:32,980 --> 00:18:35,500 To capture the inner workings of the operation 355 00:18:35,500 --> 00:18:38,740 they need to bug their offices. 356 00:18:40,900 --> 00:18:44,460 So, putting a listening device inside a car, inside a house, 357 00:18:44,460 --> 00:18:47,620 inside a public place, as an example, 358 00:18:47,620 --> 00:18:47,860 inside a public place, are incredibly difficult activities 359 00:18:47,860 --> 00:18:50,780 are incredibly difficult activities 360 00:18:50,780 --> 00:18:51,020 with high risk, are incredibly difficult activities 361 00:18:51,020 --> 00:18:54,180 with high risk, high likelihood of detection. 362 00:18:54,180 --> 00:18:56,380 At any stage, so, had those listening devices 363 00:18:56,380 --> 00:18:56,620 At any stage, been detected at an early stage 364 00:18:56,620 --> 00:18:58,500 been detected at an early stage 365 00:18:58,500 --> 00:18:58,740 it could have imperilled been detected at an early stage 366 00:18:58,740 --> 00:19:01,660 it could have imperilled the investigation itself. 367 00:19:04,420 --> 00:19:08,060 An AFP team covertly installs a secret camera 368 00:19:08,060 --> 00:19:13,100 in Plutus Payroll's back office in the South Sydney suburb of Miranda. 369 00:19:22,660 --> 00:19:27,580 Now they have a totally new perspective of Plutus's operations. 370 00:19:34,780 --> 00:19:39,940 Working the back office is Lauren Cranston, Adam's sister. 371 00:19:39,940 --> 00:19:43,220 CLINTON FREE: Lauren Cranston's involvement in the Plutus tax fraud 372 00:19:43,220 --> 00:19:43,460 CLINTON FREE: Lauren Cranston's really was an artefact 373 00:19:43,460 --> 00:19:45,100 really was an artefact 374 00:19:45,100 --> 00:19:48,220 of the fact that she was the sister of Adam Cranston. 375 00:19:48,220 --> 00:19:48,460 She'd been really brought in of the fact that she was the sister of Adam Cranston. 376 00:19:48,460 --> 00:19:50,740 She'd been really brought in 377 00:19:50,740 --> 00:19:54,220 on the basis that Adam was right at the heart of this. 378 00:19:54,220 --> 00:19:54,460 on the basis that Adam Her role in this 379 00:19:54,460 --> 00:19:55,700 Her role in this 380 00:19:55,700 --> 00:19:55,940 Her role in this was organising a lot of the transactions 381 00:19:55,940 --> 00:19:58,860 was organising a lot of the transactions 382 00:19:58,860 --> 00:20:01,900 which occurred around the second-tier organisations. 383 00:20:04,460 --> 00:20:07,900 Federal agents are watching on here in January 2017 384 00:20:07,900 --> 00:20:11,940 to piece together how this group is moving money around. 385 00:20:12,900 --> 00:20:16,300 They've now taken almost $100 million. 386 00:20:37,260 --> 00:20:39,700 Soon cracks start to emerge. 387 00:20:39,700 --> 00:20:42,180 They underestimate one of their dummy directors, 388 00:20:42,180 --> 00:20:46,420 who goes rogue and starts withdrawing cash from some of the accounts. 389 00:20:51,180 --> 00:20:54,820 The woman takes out $25,000 in two days, 390 00:20:54,820 --> 00:20:55,060 The woman takes out $25,000 and they fear she'll take more. 391 00:20:55,060 --> 00:20:57,420 and they fear she'll take more. 392 00:21:30,420 --> 00:21:34,580 The dummy directors recruited by the syndicate in return for cash payments 393 00:21:34,580 --> 00:21:38,100 are, by design, drug-dependent and destitute people. 394 00:21:38,100 --> 00:21:42,980 They have little to no understanding of the scheme, and no assets. 395 00:21:44,740 --> 00:21:47,540 It's an appallingly criminal act. 396 00:21:47,540 --> 00:21:50,420 These people have been exploited, 397 00:21:50,420 --> 00:21:50,660 selected purely on the basis These people have been exploited, 398 00:21:50,660 --> 00:21:53,980 selected purely on the basis that they were vulnerable 399 00:21:53,980 --> 00:21:54,220 selected purely on the basis and in need of money and desperate. 400 00:21:54,220 --> 00:21:57,220 and in need of money and desperate. 401 00:21:57,220 --> 00:22:01,220 And they had no knowledge of what they were signing themselves up to. 402 00:22:01,220 --> 00:22:04,980 And they represented easy fall guys for the conspirators. 403 00:22:04,980 --> 00:22:05,260 That's a common tactic these fraudsters use. And they represented easy fall guys for the conspirators. 404 00:22:05,260 --> 00:22:07,580 That's a common tactic these fraudsters use. 405 00:22:07,580 --> 00:22:09,900 They destroy the company records, 406 00:22:09,900 --> 00:22:13,620 they put someone in who's a target, who has no assets. 407 00:22:13,620 --> 00:22:13,900 they put someone in who's a target, who has no assets. A liquidator comes in, there's no funds. 408 00:22:13,900 --> 00:22:16,820 A liquidator comes in, there's no funds. 409 00:22:16,820 --> 00:22:18,380 The liquidator will then ask 410 00:22:18,380 --> 00:22:21,460 the Australian Taxation Office for funds, or ASIC, 411 00:22:21,460 --> 00:22:21,700 the Australian Taxation Office won't get the funds 412 00:22:21,700 --> 00:22:22,940 won't get the funds 413 00:22:22,940 --> 00:22:23,180 and is left with their hands tied won't get the funds 414 00:22:23,180 --> 00:22:26,660 and is left with their hands tied as to what action they can take. 415 00:22:28,420 --> 00:22:30,340 One of the men they rely on 416 00:22:30,340 --> 00:22:33,700 to do the dirty work of recruiting dummy, or straw, directors 417 00:22:33,700 --> 00:22:38,220 is Daniel Rostankovski, also known as 'Big D'. 418 00:22:38,220 --> 00:22:42,300 He's known by the conspirators as an associate of the Comancheros. 419 00:22:43,660 --> 00:22:48,700 So, Daniel Rostankovski is, I guess, a known standover figure, 420 00:22:48,700 --> 00:22:52,980 who was involved in the recruitment of a lot of the straw directors 421 00:22:52,980 --> 00:22:57,260 who ran that second set of second-tier companies 422 00:22:57,260 --> 00:22:59,700 which were involved in the fraud. 423 00:22:59,700 --> 00:23:00,980 (INDISTINCT CHATTER) 424 00:23:00,980 --> 00:23:02,460 In the heart of Sydney 425 00:23:02,460 --> 00:23:07,780 Big D has just walked into the office of the syndicate's lawyer, Dev Menon. 426 00:23:17,540 --> 00:23:20,820 They think they can speak freely here, 427 00:23:20,820 --> 00:23:24,180 but Menon's office has now also been bugged by the AFP 428 00:23:24,180 --> 00:23:28,100 with three separate listening devices. 429 00:23:28,100 --> 00:23:32,660 Dev Menon's role in this became increasingly important. 430 00:23:32,660 --> 00:23:35,980 He was advising a lot of the actors in the fraud 431 00:23:35,980 --> 00:23:40,180 about the way in which their organisation could be structured 432 00:23:40,180 --> 00:23:40,420 about the way in which their to best avoid being detected. 433 00:23:40,420 --> 00:23:43,100 to best avoid being detected. 434 00:23:43,100 --> 00:23:43,340 MICHAEL HAYTER: to best avoid being detected. 435 00:23:43,340 --> 00:23:44,860 MICHAEL HAYTER: Well, lawyers are seen 436 00:23:44,860 --> 00:23:48,620 as being required to have a higher duty and obligations 437 00:23:48,620 --> 00:23:48,860 as being required to have in their conduct. 438 00:23:48,860 --> 00:23:50,100 in their conduct. 439 00:23:50,100 --> 00:23:51,580 They're officers of the court. 440 00:23:51,580 --> 00:23:53,740 So, to have an officer of the court 441 00:23:53,740 --> 00:23:53,980 involved in this sort So, to have an officer of the court 442 00:23:53,980 --> 00:23:57,060 involved in this sort of a criminal activity 443 00:23:57,060 --> 00:23:57,300 involved in this sort in some cases is even much worse 444 00:23:57,300 --> 00:23:59,900 in some cases is even much worse 445 00:23:59,900 --> 00:24:02,380 than having the average Joe Blow who's a criminal 446 00:24:02,380 --> 00:24:04,140 involved in this sort of activity. 447 00:24:06,620 --> 00:24:10,100 The ATO has been sending letters to some of the dummy directors, 448 00:24:10,100 --> 00:24:10,340 The ATO has been sending letters demanding they pay back 449 00:24:10,340 --> 00:24:11,780 demanding they pay back 450 00:24:11,780 --> 00:24:14,980 the tax owed by the companies they're supposedly running. 451 00:24:14,980 --> 00:24:15,220 the tax owed by the companies So far they've been eluding them. 452 00:24:15,220 --> 00:24:17,980 So far they've been eluding them. 453 00:24:19,420 --> 00:24:21,340 Onley, Menon and Adam Cranston 454 00:24:21,340 --> 00:24:24,620 start talking about covertly paying the directors off 455 00:24:24,620 --> 00:24:27,540 to ensure that they stick to the story. 456 00:24:44,420 --> 00:24:47,500 They consider paying off one particular dummy director 457 00:24:47,500 --> 00:24:47,740 They consider paying off and strategise with Big D 458 00:24:47,740 --> 00:24:49,580 and strategise with Big D 459 00:24:49,580 --> 00:24:49,820 that the man should leave town and strategise with Big D 460 00:24:49,820 --> 00:24:53,020 that the man should leave town to avoid questioning. 461 00:25:14,460 --> 00:25:16,420 They would've thought 462 00:25:16,420 --> 00:25:19,540 that they were pretty crafty, that they were pretty smart, 463 00:25:19,540 --> 00:25:22,220 that they were getting away with it for quite a long time, 464 00:25:22,220 --> 00:25:22,500 that they were getting away with it for quite a long time, when in reality they were being investigated for quite a long time 465 00:25:22,500 --> 00:25:25,980 when in reality they were being investigated for quite a long time 466 00:25:25,980 --> 00:25:29,540 in order to bring about a really strong case against them. 467 00:25:32,380 --> 00:25:35,060 Now the ATO raises the stakes, 468 00:25:35,060 --> 00:25:36,540 freezing their accounts 469 00:25:36,540 --> 00:25:40,300 to stop the flow of money from the second-tier companies. 470 00:25:40,300 --> 00:25:43,300 Plutus is still safe for now, 471 00:25:43,300 --> 00:25:46,420 but it's a severe blow to their operations. 472 00:25:46,420 --> 00:25:46,660 but it's a severe blow Lauren Cranston calls Dev Menon. 473 00:25:46,660 --> 00:25:48,660 Lauren Cranston calls Dev Menon. 474 00:25:48,660 --> 00:25:51,060 (PHONE LINE RINGS) 475 00:26:05,860 --> 00:26:07,340 With the accounts frozen 476 00:26:07,340 --> 00:26:10,540 they can't pay wages to any of their clients. 477 00:26:10,540 --> 00:26:10,780 they can't pay wages Menon immediately calls Big D. 478 00:26:10,780 --> 00:26:13,180 Menon immediately calls Big D. 479 00:26:22,140 --> 00:26:24,980 Menon tells him they need to find a dummy director 480 00:26:24,980 --> 00:26:25,220 Menon tells him to try to unlock the accounts. 481 00:26:25,220 --> 00:26:27,140 to try to unlock the accounts. 482 00:26:57,060 --> 00:26:58,820 Dev Menon is wrong. 483 00:26:58,820 --> 00:27:00,820 It IS the ATO 484 00:27:00,820 --> 00:27:02,940 using what's known as a 'garnishee order' 485 00:27:02,940 --> 00:27:06,540 to directly intervene, seizing the money owed to it. 486 00:27:06,540 --> 00:27:06,780 (PHONE LINE RINGS) to directly intervene, seizing the money owed to it. 487 00:27:06,780 --> 00:27:09,060 (PHONE LINE RINGS) 488 00:27:55,820 --> 00:27:59,540 Federal agents listening in continue to build the case against them. 489 00:27:59,540 --> 00:27:59,780 Federal agents listening in continue In this casual exchange 490 00:27:59,780 --> 00:28:01,380 In this casual exchange 491 00:28:01,380 --> 00:28:06,420 they capture a brazen admission that the scheme is ripping people off. 492 00:28:23,740 --> 00:28:27,300 Adam Cranston, Dev Menon and Simon Anquetil are in denial. 493 00:28:38,020 --> 00:28:40,860 They're clinging to a belief they can keep Plutus going. 494 00:28:41,820 --> 00:28:44,020 In an attempt to throw the ATO off 495 00:28:44,020 --> 00:28:47,180 they plan to pay just a little more tax. 496 00:28:58,980 --> 00:29:00,700 It's just the arrogance. 497 00:29:00,700 --> 00:29:03,180 You sort of sit there and you listen to that and you go, you know, 498 00:29:03,180 --> 00:29:06,060 "These people are proud of what they're doing." 499 00:29:06,060 --> 00:29:06,340 "These people are proud of what they're doing." It's easy to say ripping off the tax system, 500 00:29:06,340 --> 00:29:08,660 It's easy to say ripping off the tax system, 501 00:29:08,660 --> 00:29:11,740 but they're ripping off everyday Australians 502 00:29:11,740 --> 00:29:11,980 but they're ripping off with significant amounts of money, 503 00:29:11,980 --> 00:29:14,620 with significant amounts of money, 504 00:29:14,620 --> 00:29:20,540 and they're showing an intent to go bigger, go harder in doing so. 505 00:29:23,180 --> 00:29:28,380 Panic sets in and now they're trying desperately to cover their tracks. 506 00:29:41,700 --> 00:29:43,540 Lauren Cranston can be seen here 507 00:29:43,540 --> 00:29:43,780 bundling laptops and documents Lauren Cranston can be seen here 508 00:29:43,780 --> 00:29:46,460 bundling laptops and documents into a bag 509 00:29:46,460 --> 00:29:49,140 to destroy evidence that could incriminate them. 510 00:29:49,140 --> 00:29:49,380 to destroy evidence That needs to go. 511 00:29:49,380 --> 00:29:50,660 That needs to go. 512 00:29:52,180 --> 00:29:55,220 The court later heard that Adam Cranston was present 513 00:29:55,220 --> 00:29:58,660 as they lit a bonfire in a skip bin to destroy paperwork. 514 00:29:58,660 --> 00:29:58,900 as they lit a bonfire in a skip bin It also heard there were discussions 515 00:29:58,900 --> 00:30:00,340 It also heard there were discussions 516 00:30:00,340 --> 00:30:03,820 about which laptops "needed to go for a swim." 517 00:30:06,540 --> 00:30:09,540 As they try to mount their defences against the ATO, 518 00:30:09,540 --> 00:30:13,140 internally the syndicate is at breaking point. 519 00:30:14,100 --> 00:30:15,900 So, I think it's the case 520 00:30:15,900 --> 00:30:18,780 that if you and I had a profitable company 521 00:30:18,780 --> 00:30:20,660 we'd soon start to receive phone calls 522 00:30:20,660 --> 00:30:20,900 we'd soon from big venture-capital companies. 523 00:30:20,900 --> 00:30:22,180 from big venture-capital companies. 524 00:30:22,180 --> 00:30:22,420 from big venture-capital companies. If we're running a criminal enterprise, 525 00:30:22,420 --> 00:30:24,700 If we're running a criminal enterprise, 526 00:30:24,700 --> 00:30:25,980 we also get the phone calls, 527 00:30:25,980 --> 00:30:27,460 but those phone calls would be 528 00:30:27,460 --> 00:30:27,700 from the Comancheros but those phone calls would be 529 00:30:27,700 --> 00:30:30,220 from the Comancheros or the Hell's Angels. 530 00:30:32,140 --> 00:30:34,900 Their business partner Big D turns on them 531 00:30:34,900 --> 00:30:35,140 Their business partner Big D with a chilling blackmail demand. 532 00:30:35,140 --> 00:30:38,180 with a chilling blackmail demand. 533 00:30:48,540 --> 00:30:52,380 First he threatens violence from the Comancheros, 534 00:30:52,380 --> 00:30:52,620 then he threatens to expose them. from the Comancheros, 535 00:30:52,620 --> 00:30:55,580 then he threatens to expose them. 536 00:31:19,420 --> 00:31:22,060 Big D calls one of his dummy directors... 537 00:31:23,380 --> 00:31:25,180 ..who claims he's outside 538 00:31:25,180 --> 00:31:27,340 the Australian Federal Police headquarters 539 00:31:27,340 --> 00:31:27,580 the Australian Federal Police poised to upend the entire scheme. 540 00:31:27,580 --> 00:31:30,100 poised to upend the entire scheme. 541 00:31:49,980 --> 00:31:52,380 With the upper hand against his former allies, 542 00:31:52,380 --> 00:31:57,540 Big D demands they pay $5 million in exchange for silence. 543 00:32:19,180 --> 00:32:23,260 Big D later ups the figure to $25 million. 544 00:32:23,260 --> 00:32:26,300 Within three months they've paid it in full. 545 00:32:28,660 --> 00:32:30,860 JOHN COYNE: No honour among thieves. 546 00:32:30,860 --> 00:32:31,100 We really have to avoid feeling any form of sympathy for these people. JOHN COYNE: No honour among thieves. 547 00:32:31,100 --> 00:32:35,540 We really have to avoid feeling any form of sympathy for these people. 548 00:32:35,540 --> 00:32:39,420 They undertook a sophisticated criminal operation, 549 00:32:39,420 --> 00:32:39,700 They undertook a sophisticated criminal operation, set it up, gloated about it, manipulated people, 550 00:32:39,700 --> 00:32:44,060 set it up, gloated about it, manipulated people, 551 00:32:44,060 --> 00:32:47,740 and, so, when they were discovered by other criminal groups, 552 00:32:47,740 --> 00:32:50,620 in some ways they got their just desserts. 553 00:32:52,860 --> 00:32:56,500 Now threats are coming at them from all sides. 554 00:32:56,500 --> 00:33:00,660 A business associate extorts Jay for more money. 555 00:33:32,060 --> 00:33:34,660 On 26 April 2017 556 00:33:34,660 --> 00:33:38,300 the moment the architects of the Plutus Payroll scheme have dreaded 557 00:33:38,300 --> 00:33:39,940 finally arrives. 558 00:33:39,940 --> 00:33:43,180 Investigators are ready to take down the syndicate. 559 00:33:43,180 --> 00:33:47,740 The ATO freezes all the bank accounts operated by Plutus Payroll, 560 00:33:47,740 --> 00:33:51,500 bringing the entire scheme to a shuddering halt. 561 00:33:55,820 --> 00:33:58,020 In a final act of desperation 562 00:33:58,020 --> 00:34:00,820 Adam picks up the phone and calls his father, 563 00:34:00,820 --> 00:34:01,060 Adam picks up the phone a Deputy Commissioner of the ATO, 564 00:34:01,060 --> 00:34:02,740 a Deputy Commissioner of the ATO, 565 00:34:02,740 --> 00:34:04,420 Michael Cranston. 566 00:34:04,420 --> 00:34:04,620 (PHONE LINE RINGS) Michael Cranston. 567 00:34:04,620 --> 00:34:06,500 (PHONE LINE RINGS) 568 00:34:08,500 --> 00:34:12,500 Recordings of this call would later be used as evidence in Adam's trial. 569 00:34:12,500 --> 00:34:16,500 He gives his father a highly selective version of events, 570 00:34:16,500 --> 00:34:19,020 telling Michael he thinks Plutus's troubles 571 00:34:19,020 --> 00:34:21,460 are linked to a previous business partner. 572 00:34:31,220 --> 00:34:34,500 There is no evidence Michael Cranston is aware of his son's scheme. 573 00:34:34,500 --> 00:34:34,740 Nevertheless, he offers him advice. is aware of his son's scheme. 574 00:34:34,740 --> 00:34:36,980 Nevertheless, he offers him advice. 575 00:35:00,340 --> 00:35:02,020 Michael Cranston would later say 576 00:35:02,020 --> 00:35:04,180 he gave Adam the same general guidance 577 00:35:04,180 --> 00:35:06,220 that he would to any taxpayer. 578 00:35:07,180 --> 00:35:10,300 The average Australian doesn't have the capacity to 579 00:35:10,300 --> 00:35:10,580 contact their father whenever there's a potential issue The average Australian doesn't have the capacity to 580 00:35:10,580 --> 00:35:13,940 contact their father whenever there's a potential issue 581 00:35:13,940 --> 00:35:14,180 contact their father with the ATO. 582 00:35:14,180 --> 00:35:15,500 with the ATO. 583 00:35:15,500 --> 00:35:17,540 So, any sort of advice here, 584 00:35:17,540 --> 00:35:17,740 So, any sort of advice here, I think, is deeply problematic. 585 00:35:17,740 --> 00:35:19,580 I think, is deeply problematic. 586 00:35:20,540 --> 00:35:22,820 (PHONE LINE RINGS) 587 00:35:27,300 --> 00:35:31,740 Adam's contact with his father, Michael, continued days later. 588 00:36:03,660 --> 00:36:05,500 Michael Cranston later says 589 00:36:05,500 --> 00:36:08,420 that in this conversation he was referring to an incident 590 00:36:08,420 --> 00:36:11,460 where a former business partner of Adam's embezzled funds. 591 00:36:11,460 --> 00:36:16,700 He warns Adam that Plutus might already be on an ATO watchlist. 592 00:36:45,740 --> 00:36:48,740 Michael Cranston never follows through on these inquiries 593 00:36:48,740 --> 00:36:48,980 Michael Cranston never or accesses any tax records. 594 00:36:48,980 --> 00:36:51,020 or accesses any tax records. 595 00:36:51,020 --> 00:36:53,060 He then cautions his son 596 00:36:53,060 --> 00:36:56,420 that he needs to be able to account for his assets. 597 00:37:06,060 --> 00:37:09,580 I think this is a realisation from Michael Cranston 598 00:37:09,580 --> 00:37:12,100 that the lifestyle that his son's living 599 00:37:12,100 --> 00:37:15,460 is really out of kilter with perhaps what he's declared. 600 00:37:15,460 --> 00:37:18,660 By the time the Plutus thing has been wrapped up, 601 00:37:18,660 --> 00:37:23,340 Adam has multiple sports cars in his ownership. 602 00:37:37,380 --> 00:37:39,300 In mid-May 2017 603 00:37:39,300 --> 00:37:41,540 federal agents swoop on the syndicate, 604 00:37:41,540 --> 00:37:46,260 executing 36 search warrants and arresting nine people. 605 00:37:52,380 --> 00:37:55,980 Some of the assets and proceeds of crime seized include 606 00:37:55,980 --> 00:37:58,460 at least $15 million in cash, 607 00:37:58,460 --> 00:38:01,100 25 motor vehicles, 608 00:38:01,100 --> 00:38:03,500 18 residential properties, 609 00:38:03,500 --> 00:38:05,500 12 motorbikes, 610 00:38:05,500 --> 00:38:10,300 in excess of 100 bank accounts and share-trading accounts, 611 00:38:10,300 --> 00:38:12,940 two aircraft, 612 00:38:12,940 --> 00:38:17,020 firearms, jewellery, artwork, vintage wines 613 00:38:17,020 --> 00:38:17,260 firearms, jewellery, artwork, and also at least $1 million 614 00:38:17,260 --> 00:38:19,780 and also at least $1 million 615 00:38:19,780 --> 00:38:22,260 that we've located in a safe deposit box. 616 00:38:29,220 --> 00:38:31,540 It's absolutely not victimless. 617 00:38:31,540 --> 00:38:33,780 It feeds other crimes. 618 00:38:33,780 --> 00:38:35,780 It feeds organised crime. 619 00:38:35,780 --> 00:38:37,260 It allows these criminals 620 00:38:37,260 --> 00:38:37,460 It allows these criminals to keep operating. 621 00:38:37,460 --> 00:38:39,180 to keep operating. 622 00:38:39,180 --> 00:38:41,900 And it really does remove 623 00:38:41,900 --> 00:38:42,140 a huge amount of money And it really does remove 624 00:38:42,140 --> 00:38:45,820 a huge amount of money from public resourcing. 625 00:38:45,820 --> 00:38:48,540 Money then has to go into investigations as a result. 626 00:38:48,540 --> 00:38:55,140 It has to go into legal aid for people that are being investigated. 627 00:38:55,140 --> 00:38:57,380 So, it costs a lot of money. 628 00:38:57,380 --> 00:39:01,500 Financial crime costs a lot and it costs every single one of us. 629 00:39:01,500 --> 00:39:03,980 (CAMERA SHUTTERS CLICK) 630 00:39:03,980 --> 00:39:07,540 Deputy Commissioner Michael Cranston was charged with two counts 631 00:39:07,540 --> 00:39:10,500 of abusing his position as a public official 632 00:39:10,500 --> 00:39:12,300 to obtain a benefit for his son Adam. 633 00:39:12,300 --> 00:39:14,020 Excuse me. Why did you resign from the ATO? 634 00:39:14,020 --> 00:39:17,220 He was never accused of taking part in the tax fraud 635 00:39:17,220 --> 00:39:20,740 and was found not guilty of the charges in 2019. 636 00:39:20,740 --> 00:39:23,540 JOHN WINTER: I guess one of the more shocking aspects 637 00:39:23,540 --> 00:39:23,780 JOHN WINTER: I guess is how closely it was connected 638 00:39:23,780 --> 00:39:25,420 is how closely it was connected 639 00:39:25,420 --> 00:39:28,140 to one of the most senior people in the ATO. 640 00:39:29,100 --> 00:39:32,380 And we understand that the evidence has been brought forward 641 00:39:32,380 --> 00:39:32,660 that he didn't know of the conspiracy that was going on, And we understand that the evidence has been brought forward 642 00:39:32,660 --> 00:39:36,580 that he didn't know of the conspiracy that was going on, 643 00:39:36,580 --> 00:39:39,100 but it certainly raises your eyebrows 644 00:39:39,100 --> 00:39:42,660 when the children of a Deputy Commissioner of the ATO 645 00:39:42,660 --> 00:39:45,260 are the people leading the greatest tax fraud 646 00:39:45,260 --> 00:39:45,500 are the people in the history of Australia. 647 00:39:45,500 --> 00:39:46,980 in the history of Australia. 648 00:39:46,980 --> 00:39:47,220 It was a shocking moment in the history of Australia. 649 00:39:47,220 --> 00:39:49,140 It was a shocking moment for everybody. 650 00:39:51,380 --> 00:39:53,620 An independent review by the Tax Office 651 00:39:53,620 --> 00:39:57,300 found Michael Cranston failed to act with honesty and integrity. 652 00:39:58,260 --> 00:40:00,180 Michael Cranston told Four Corners 653 00:40:00,180 --> 00:40:02,700 he rejects the findings of the ATO review, 654 00:40:02,700 --> 00:40:04,900 that it took the recordings out of context 655 00:40:04,900 --> 00:40:08,500 and that he did not participate in it while his criminal case was ongoing. 656 00:40:08,500 --> 00:40:08,740 and that he did not participate in it (CAMERA SHUTTERS CLICK) 657 00:40:08,740 --> 00:40:11,780 (CAMERA SHUTTERS CLICK) 658 00:40:11,780 --> 00:40:14,100 Daniel Rostankovski pleaded guilty 659 00:40:14,100 --> 00:40:16,580 to blackmail, money laundering and fraud, 660 00:40:16,580 --> 00:40:19,420 and was sentenced to 10 years imprisonment. 661 00:40:21,820 --> 00:40:24,100 Simon Anquetil pleaded guilty 662 00:40:24,100 --> 00:40:24,340 to conspiring to dishonestly cause Simon Anquetil pleaded guilty 663 00:40:24,340 --> 00:40:27,420 to conspiring to dishonestly cause a loss to the Australian government 664 00:40:27,420 --> 00:40:29,940 and dealing with the proceeds of crime. 665 00:40:29,940 --> 00:40:33,980 He was sentenced to seven years imprisonment in 2020. 666 00:40:38,300 --> 00:40:40,660 ANTHONY PAYNE: The tax fraud and money-laundering conspiracies 667 00:40:40,660 --> 00:40:44,580 involved a significant level of sophistication, premeditation, 668 00:40:44,580 --> 00:40:46,100 planning and deception 669 00:40:46,100 --> 00:40:50,140 and a high degree of dishonesty and corresponding breach of trust. 670 00:40:50,140 --> 00:40:50,380 and a high degree of dishonesty (CAMERA SHUTTERS CLICK) 671 00:40:50,380 --> 00:40:51,980 (CAMERA SHUTTERS CLICK) 672 00:40:51,980 --> 00:40:56,020 Lauren Cranston was found guilty at trial of the same offences. 673 00:40:56,020 --> 00:41:00,780 She was sentenced to eight years imprisonment in March 2023. 674 00:41:02,420 --> 00:41:04,060 ANTHONY PAYNE: I have concluded 675 00:41:04,060 --> 00:41:07,300 that, whilst greed in the receipt of over $181,000 676 00:41:07,300 --> 00:41:08,660 for her involvement in the conspiracies 677 00:41:08,660 --> 00:41:11,500 forms part of the explanation for Ms Cranston's conduct, 678 00:41:11,500 --> 00:41:13,860 her participation was primarily the result 679 00:41:13,860 --> 00:41:15,260 of a misguided sense of loyalty 680 00:41:15,260 --> 00:41:17,300 to the people directing the conspiracies, 681 00:41:17,300 --> 00:41:19,580 particularly her brother, Adam Cranston. 682 00:41:21,380 --> 00:41:24,180 Adam Cranston, Dev Menon and Jay Onley 683 00:41:24,180 --> 00:41:26,140 were also found guilty at trial 684 00:41:26,140 --> 00:41:28,780 and will be sentenced in coming weeks. 685 00:41:56,380 --> 00:41:58,380 Captions by Red Bee Media 686 00:41:58,380 --> 00:42:00,580 Copyright Australian Broadcasting Corporation