Phoenix Hotline will oust dodgy directors
The Government has introduced a Phoenix Hotline in a bid to combat illegal phoenixing, which the Government estimates costs the economy around $5 billion per annum, the Minister for Revenue and Financial Services, Kelly O’Dwyer, has said.
O’Dwyer said the Hotline would make it easier to report suspected phoenix behaviour directly to the Australian Taxation Office (ATO), enabling timely action against companies and their directors.
In her interview with the ATO and the Australian Securities and Investments Commission (ASIC), the Minister said the Government would introduce a whole range of reforms, including new phoenixing offences, following the release of the Phoenix Taskforce’s recent report.
“This will mean that people who do the wrong thing can be jailed for up to ten years, or they could be fined $945,000 or three times the benefit or both,” said O’Dwyer.
She said directors would also be made personally liable for indirect taxes through the extended director penalty provisions and would further be prevented from backdating their resignations to avoid personal liability.
ASIC’s Victorian regional commissioner, Warren Day, welcomed the release of the report, and said the new strategy aims to deter directors and facilitators from engaging in illegal activity and hold them accountable if they are found to have breached the law.
“ASIC and our phoenix partners are working together to deter, disrupt and detect directors and others who engage and facilitate illegal phoenix activity and this report is very much a product of that partnership,” he said.
AUTHOR
Anastasia Santoreneos
Recommended for you
The Reserve Bank of Australia (RBA) has lowered rates to a level not seen since mid-2023.
Financial Services Minister Stephen Jones has shared further details on the second tranche of the Delivering Better Financial Outcomes reforms including modernising best interests duty and reforming Statements of Advice.
The Federal Court has found a company director guilty of operating unregistered managed investment schemes and carrying on a financial services business without holding an AFSL.
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
