Outgoing ATO boss Chris Jordan warns tax fraud and cyber breaches on the rise

Millions of Australian taxpayers are at a greater risk of falling victim to tax fraud and identity theft than ever before, the nation’s chief tax boss has warned.

In one of his last major public addresses before stepping down at the end of the month, outgoing tax commissioner Chris Jordan warned the agency had recorded a significant rise in fraud in the aftermath of Covid-19.

He said Australian employees were increasingly being ripped off by their employers who withhold tax and super from their wages while also flagging an increase in identity theft.

“We cannot allow that to stand, especially the super for employees. I think you, and the community, would agree that we cannot allow people to live off the money that’s just not theirs,” Mr Jordan told the National Press Club.

“Meanwhile, the risk of sophisticated fraud attempts through the increase in enormous data theft will only continue to grow.

“We are working to harden our systems and are putting measures in place to help people.”

Mr Jordan, who is due to leave his high-profile role as Australia’s Tax Commissioner on February 26, said he had thought the tax agency had made significant progress during his 11-year term.

He said the agency’s “landmark victories” in getting multinational giants like Apple, BHP, Facebook, Microsoft and Google to pay billions more in tax helped to lead a significant shift in global attitudes towards tax compliance.

He also called investigation of 150 ATO officials over suspicions they engaged in a GST fraud scheme “appalling” and said while it was unlikely that similar scams would emerge in the future – the threat of identity fraud was imminent.

“What is of concern to me now is what I refer to as the industrialisation of identity theft through large-scale cyber breaches,” he said.

“So, you look at … Optus – the pool of information they have on people that can be used to create an identity of someone that is not that person using it is enormous,” he said.

The ATO recently investigated an incident where 30,000 new super funds were created using stolen information taken from the dark web.

Mr Jordan said the cyber criminals involved in the hack were able to use bots to fill out online forms and called for greater government investment to curb emerging online threats.

“This is scary stuff,” he said.

“We have to keep convincing the government that is something that continuous funding will be required. The criminals are smart. But we’ve just got to keep ahead.”