Tuesday, February 27, 2024

Family of accused in alleged $180m tax fraud boasts $40m in property

 Family of accused in alleged $180m tax fraud boasts $40m in property

David Marin-GuzmanWorkplace correspondent

The alleged controlling mind of a suspected $180 million tax fraud and his family own tens of millions of dollars in property, including luxury penthouses boasting views of Sydney harbour.

The Australian Taxation Office is investigating an alleged scheme involving NSW formwork contractor Dalma and labour hire firms that it estimates caused a record $150 million to $180 million in tax losses over 15 years and which it claims Dalma director Igor Cikes may have been the “controlling mind”.
The alleged scheme would be the country’s biggest tax fraud if proven and was revealed as Assistant Treasurer Stephen Jones warned that “criminals are using sophisticated approaches to commit tax fraud”.
Property searches for Mr Cikes and asset-holding companies associated with him and his family reveal a dozen properties worth more than $40 million, including Balmain and North Sydney penthouses, industrial estates and multiple homes and apartments.
The properties are likely to become a focus of liquidator investigations into the collapsed Dalma Form Specialist Pty Ltd and other related entities allegedly involved in the scheme, which the ATO says totals about 30 companies.
According to title searches, Mr Cikes owns a lavish $4.4 million four-bedroom apartment in North Sydney’s prestigious Alexander building with panoramic views of the city and the harbour.
Igor Cikes has denied a relationship to Dalma Form Specialist. 
His company Cikes Development NSW, of which he is director and shareholder, owns four homes at Bankstown in Sydney’s west with an estimated total value of $7.6 million.
Meanwhile, his mother, a shareholder in Dalma, owns an apartment in Sydney’s north shore and a Balmain penthouse with harbour views estimated to be worth $5.3 million in total.
Yaleson Corporation, an entity whose shareholders and directors are Mr Cikes’ parents, owns an industrial estate in Mount Druitt estimated to be worth $12 million as well as two Kings Park properties and a Pymble apartment worth $10 million in total.
Dalma and Mr Cikes did not return requests for comment before publication. Mr Cikes’ parents, have not been accused of any wrongdoing. Mr Cikes has told liquidators he has no relationship to Dalma Form Specialist.
Rival insolvency experts Bruce Gleeson, who previously unravelled fraudster Melissa Caddick’s finances, and Stephen Hathway, who is funded by the ATO, are investigating the collapse of different companies in the alleged scheme.
One of four bedrooms in the North Sydney penthouse. 
However, the tax office wants Mr Hathway to take charge of the investigation and has threatened to take the matter to court to appoint him liquidator of the group.
If the tax loss is substantiated Mr Hathway is likely to focus on recovery actions for creditors including the ATO.
Assistant Treasurer Mr Jones said the government had provided more than $220 million in last year’s budget to expand the serious financial crimes taskforce because “criminals are using sophisticated approaches to commit tax fraud”.
“The government supports the ATO cracking down on these criminals with the full weight of the law, supported by the additional resourcing the government has provided,” he said.
Other formwork contractors, whose work involves laying down structures for concrete to be poured on, have complained that Dalma quoted prices for projects that were 15 to 20 per cent lower than other bidders.
A spokesman for the NSW government said it was up to builders to police subcontractors for government-funded projects.
“The NSW government construction agreements come with a range of measures and safeguards which put the onus on head contractors to deliver projects in a responsible and ethical way,” he said.
He added strict procurement policies required agencies to consider “the extent to which a head contractor can deliver a project without exposing an unacceptable actual and reputational risk”.
“This includes any risk relating to their relationship with subcontractors.”
A spokesman for Lendlease, which often engaged Dalma on major projects, said that “we maintain robust procurement processes, including engaging an independent third-party provider to undertake a financial assessment of subcontractors before any contract is awarded”.

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David Marin-Guzman writes about industrial relations, workplace, policy and leadership from Sydney. Connect with David on Twitter. Email David at david.marin-guzman@afr.com