“Bro, get Brylie to register for GST, and we’ll be able to pump 20k a month,” the unnamed brother-in-law texted Bevan in early 2022.
How one woman tried to get $115,000 in fake GST refunds
How the TikTok tax fraud overran a country town
The stories of the first four people convicted for tax fraud form a snapshot of how a scheme so simple it could be carried out online spread throughout a small community. But it spread much further, to at least 56,000 people nationally.
Catherine wanted her teeth done and new tyres for her car. Brylie said she “thought it was legit”. Walton blamed it on his brother-in-law, and Jennifer spent the money on “some stupid shit”.
The first four people to be convicted this year from the Tax Office’s Operation Protegoseparately obtained a total of $153,000 from fraudulent GST claims, in a scam which began spreading via social media influencers on TikTok in late 2020.
TikTok says it co-operated with the Tax Office to permanently ban more than 60 accounts that promoted GST fraud.
Their story is an exemplar of how a $4.6 billion fraud wave played out in one town: Mildura, in north-west Victoria. In November 2022, Victoria Police’s Mildura Crime Investigation Unit arrested 10 people aged between 20 and 53 for alleged GST fraud worth around $5 million.
It’s part of a saga that was playing out in towns and communities around Australia. The ease with which everyday Australians could link their online government services account myGov with the Australian Taxation Office and submit claims with no oversight ultimately led to billions in fraudulent claims across the country.
The scam involved individuals obtaining an Australian Business Number then using their myGov account to file fraudulent business activity statements to claim GST refunds.
Penalties for the four people convicted ranged from a suspended sentence to prison terms of one or two months, underlining the challenge the ATO faces with 100-plus arrests and more than 56,000 people facing compliance action for their part in the $4.6 billion fraud.
That figure includes $1.6 billion paid out in fraudulent GST refunds, another $2.7 billion in claims that were stopped, and another $300 million in penalties and interest.
Mildura Magistrates and County Court of Victoria hearings reveal the wide range of people caught up as the scam exploded in the town, where police reported “many, many” cases of the fraud. They also detailed systemic issues with taking government services online for convenience, but failing to provide proper checks and balances.
For Walton Bevan, the court heard, it began with a simple text exchange from his brother-in-law, who had just been released from prison.
“Bro, get Brylie to register for GST, and we’ll be able to pump 20k a month,” the unnamed brother-in-law texted Bevan in early 2022.
Brylie was Brylie Phillips, Bevan’s wife. She had an old ABN for a catering business that she reactivated. Her brother helped her make seven monthly claims for GST refunds totalling $38,765 before the ATO cancelled her GST registration, the court found.
The scam spread by text and social media in Mildura, Victoria.
‘It might come back to bite me’
Bevan, registered as a sole trader, obtained another $59,769 from his own version of the scam, which he spent on rent and repairs for his ute. A significant amount of the cash remained when he was arrested in late 2022 He said he “knew he f---ed up”, the court was told, and told police he wanted to pay back the money.
Across town, Catherine Leonia Dyason was registering a hairdressing business on February 9. She would tell police when she was arrested on December 8 that she gave her details to someone else, who set it up for her.
“It was stupid,” she said. She worried that “it might come back to bite [me] in the arse”.
Before that happened she had obtained $34,209 from fictitious GST claims, which she spent on her teeth and new tyres.
Jennifer Blanke’s case is the most poignant. Five days after Dyason was registering her hairdressing business, Blanke’s partner Nathan Finlay, 39, a former miner and grape farmer with a history of petty crime, was helping Blanke register an old dog-grooming business she had re-activated for GST.
The pair lived a “chaotic and unstable existence” in Mildura as long-time methamphetamine addicts, the County Court in Melbourne heard in July this year.
“I heard that everybody was getting tax and, yeah, I joined the club,” she told police when she was arrested last November. “Got my phone, got on My ATO, linked my myGov, and away I went.”
Refund, but a lack of business activity
Finlay helped Blanke file a February business activity statement on March 14, 2022, which reported she had spent $250,000 setting up the business, and claimed a GST refund of $20,536.
The Tax Office paid out the claim two weeks later, on March 24, but it was the last easy money the pair would see.
On April 20, Finlay helped file another BAS claiming Blanke had spent $548,790 on the dog-grooming business, and made a claim for $48,072 in GST refunds.
The ATO tries to make decisions on GST claims in 12 days. On May 2, it told Blanke it had denied the claim “because of the unusual refund activity and the lack of evidence that you were in fact carrying on business”.
The next day Finlay was arrested after he got into a fight outside Coles in Mildura. He was held for 10 days before the magistrates court sentenced him to time served plus $2300 in fines.
Finlay needed money, and even though the previous GST claim had been knocked back on May 20 he filed a new business activity statement for Blanke for April.
In an apparent attempt to show it was a functioning business, the BAS claimed she spent $605,000 on expenses but had collected $25,429 in GST from sales, after which Blanke claimed $25,927 in refunds.
The following day Finlay died in the emergency department of Mildura hospital from stab wounds, with two men arrested two days later in South Australia. It’s not clear what happened.
The refund claim that Finlay had made for Blanke was knocked back on May 27, and after Blanke made yet another unsuccessful refund claim in June for $17,000 the ATO contacted Victorian police.
None of the $20,536 she and Finlay obtained in March was left. The money “just kinda went real quick”, she told police in November. She took it out “to spend it on stupid shit”.
Bevan was sentenced to two months, Phillips to 250 hours community service, and Dyason to one month prison, while Blanke received a suspended sentence on condition she continued to work towards ending her addiction.
For these four, and for the other 56,000 people caught in the scam, life will never be the same.
Find out the inside scoop about Accenture, Deloitte, EY, KPMG, PwC and McKinsey. Sign up to our weekly Professional Life newsletter.
