Hightrade Group executive Li Zhang has today been sentenced to 10 years in prison, with a non-parole period of 6 years and 8 months, for conspiring with the intention to cause a loss to the Commonwealth of $ 15 million, contrary to s135.4(3) of the Criminal Code, bringing one of our longest tax fraud investigations to a close.
This sentencing is a direct result of Operation 4, an Australian Taxation Office (ATO) investigation which commenced in 2008 after 5 years of audit activity. During the investigation multiple search warrants were executed. Mr Zhang fled Australia shortly after, eventually relocating to New Zealand.
ATO Assistant Commissioner Jade Hawkins welcomed the sentencing.
“Mr Zhang conspired to lodge fraudulent BAS on behalf of two companies which he was involved with. These companies were part of the Hightrade Group, which developed high profile properties in the Hunter Valley and Sydney regions,” Ms Hawkins said.
“The fraud involved the use of multiple related companies that grossly inflated construction costs between themselves, and ultimately failed to remit the GST to the ATO. There were also claims of company purchases that simply didn’t exist.”
“The sentencing of Mr Zhang, shows that no matter where you are, we will find you and hold you accountable for your actions.”
Mr Zhang’s conviction for two counts of conspiracy to defraud the Commonwealth followed his extradition from New Zealand, undertaken with assistance from the Australian Federal Police and the Commonwealth Director of Public Prosecutions.
“Tax crime affects the whole community. This was not an ordinary business operating legitimately – it was outright tax fraud. Mr Zhang undermined genuine businesses by heavily under-quoting, and he left business creditors and employees without their entitlements,” Ms Hawkins said.
“We are committed to ensuring the integrity of the tax and super system as well as levelling the playing field for businesses who do the right thing. Tax fraud also reduces the amount of revenue available to fund essential community services, like health and education.”
You can anonymously report tax evasion and crime activities to the ATO online at www.ato.gov.au/tipoff or by calling 1800 060 062.
This matter was prosecuted by the Commonwealth Director of Public Prosecutions.
