Three operators of labour hire companies in South Australia and Queensland received prison sentences for conspiring to defraud the government of AUD 4.6 million, the Australian Taxation Office announced.

It reported the three operators formed labour hire companies to provide workers to vineyards, fruit and vegetable growers as well as meat processors. However, the companies failed to remit both Goods and Services Tax and Pay as You Go withholding to the Australian Taxation Office despite charging their clients GST and including figures supposedly withheld for PAYG on employee payslips.

One of the defendants, Seng Leng Heng, received a sentence of eight years in prison as the “instigator and architect of the scheme,” according to the Australian Taxation Office. The two others, Nathan Sarinn and Nay Chy, were sentenced to four and five years’ imprisonment, respectively.

Defendants would set up a labour hire entity in one area and then cease operating only to form new entities, according to the office. They also attempted to hide illegal activities by appointing shadow directors and exploited their relationships with employees or acquaintances living in Australia, at least three of whom were on student visas.