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Beware of COVID-19 stimulus fraudsters

Beware of COVID-19 stimulus fraudsters

The Tax Practitioners Board (TPB) warns the community and businesses to take extra care when seeking assistance in accessing the government’s COVID-19 stimulus measures.

This follows the identification of a growing number of complaints and intelligence about fraudsters posing as tax experts, providing misleading advice and support relating to COVID-19 stimulus benefits, often provided on a ‘no benefit – no fee’ basis.

The arrangements are often promoted through social media channels, claim to offer advice and support along with unnecessary services in a subscription or locked-in contract. Some of these arrangements involve businesses with thousands of clients. The organisations involved may claim that the advice being provided is ‘assured’ by a registered tax agent. That advice may be incorrect and breach the Tax Agent Services Act (TASA).

The TPB will prioritise investigations into organisations who have been involved in such conduct.

Often, an agreement may require the client to provide personal or confidential information including Tax File Numbers or MyGov ID logins. Unregistered service providers however, often have poor IT and security controls and are susceptible to identity theft.

TPB Chair, Ian Klug AM said, ‘We are investigating organisations operating in this way to establish how, and which, services are being provided and whether they are in contravention of the law.’

‘We are concerned about protecting the consumers of taxation services as we know the accuracy of the advice given by unregistered agents is not reliable and there is no safe way to ‘assure’ advice by an unregistered tax adviser simply by involving a registered agent on the fringe of the business. Incorrect advice may prevent the full amount of the benefit from reaching its intended recipients. Also, incorrectly received benefits may have to be repaid and recipients may be liable for penalties and interest.’

The community is urged to check whether their tax practitioner is registered on the public register at www.tpb.gov.au/onlineregister and follow the TPB’s tips when seeking taxation or COVID-19 stimulus advice.

Mr Klug added, ‘If you are not a registered practitioner and your business is engaged in providing advice or services related to any of the COVID-19 stimulus benefits such as Jobkeeper, Cash Boost or Early Release from Super, you are in breach of the TASA and may be liable for a civil penalty imposed by the Federal Court.’

Any small business or individual unwittingly caught up in unfair contracts with businesses offering ‘assured’ tax services should seek legal advice.

If you become aware of a potential scam or unregistered tax practitioner, report the situation to the TPB either covid19tipoff [at] tpb.gov.au (by email) or by calling 1300 362 829 (select option 5). All reports will be treated in the strictest confidence.

About the Tax Practitioners Board

The Tax Practitioners Board regulates tax practitioners in order to protect consumers. The TPB aims to assure the community that tax practitioners meet appropriate standards of professional and ethical conduct. Follow us on Twitter @TPB_gov_au, Facebook and LinkedIn

Thursday, May 21, 2020