Ex-lawyer's $185m Tax Scam Stunning, Says Judge
The Age
Saturday February 2, 2008
A JUDGE has described a former Melbourne lawyer's $185 million tax fraud as being on a "stunning" scale he'd never seen before.
Former solicitor Peter Ambrosy allegedly devised and promoted schemes that claimed combined tax losses of $185 million from the tax office with none ever reporting an income. Victorian County Court Judge Michael McInerney said yesterday he found the magnitude of the fraud breathtaking. "I've been on the bench 13 years and I've never heard of a tax fraud against an individual of this dimension," he said. "It's stunning, this fraud."Australia's largest tax fraud investigation, Operation Wickenby, uncovered multiple cases worth at least $300 million. Ambrosy, 57, of East Malvern, has pleaded guilty to three counts of defrauding the Commonwealth, a charge that carries up to 10 years' jail. The bogus investment schemes were funded by Australian-based, ordinary investors and overseas preferred investors, who supposedly invested at 3.5 times the rate of locals. But the prosecution alleges there is no evidence the preferred investors exist. The court has heard the charges relate to tax returns lodged for the financial years 1997 to 1999 for investment schemes in infomercials and music merchandise. Investors in the schemes were usually clients of accounting or financial advisory firms, and they received commissions for introducing their clients. Ambrosy's lawyer David Glynn said there were a number of key figures behind the schemes and his client was never in control of the money nor enriched by the ventures. Mr Glynn said that one key figure, solicitor Warwick Mowbray, fled Australia in October 2000, a day after his office was raided as part of a tax office investigation. He said another figure, insurance executive Donald McGregor, raised money for the schemes and controlled the money in Australia, but died of natural causes in 2002. The hearing resumes on Monday.
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