I just love it when they catch the big fish cheating the system
Businessman posts $1.5m bail but authorities hold onto $40m assets
May 3, 2012
A MILLIONAIRE businessman charged over a $63 million tax evasion and money laundering scheme has been allowed to return to his Gold Coast mansion after posting bail of $1.5 million.
But more than $40 million in luxury assets, including houses, cars and yachts owned by Michael John Issakidis, 67, and an associate will remain in the hands of the authorities after being seized in raids last month.
The Australian Federal Police and Australian Tax Officesay the seven-month investigation into Mr Issakidis is the largest under Project Wickenby, the federal government’s pursuit of wealthy alleged tax evaders.
Prime real estate in Sydney and on the Gold Coast as well as several Rolls-Royces, a Lamborghini, an Aston Martin, a Mercedes-Benz and yachts have been seized under the new federal proceeds of crime laws, the AFP said.
Mr Issakidis faced Central Local Court last week charged with dealing in the proceeds of crime of more than $1 million and conspiring to cause loss to the Tax Office.
Magistrate Antony Townsden granted him bail on the condition he live at his Paradise Point home on a $1 million bail. Rhonda Laraine Issakidis and Nance Beverley Toope also agreed to each post $250,000 with the court.
Earlier this year, Mr Issakidis sued ”Baby” John Burgess for $30,000 in unpaid rent the former TV host owed on his sub-penthouse in the Gold Coast’s Q1 building.
Greek-born Mr Issakidis is the managing director of NeuMedix Health Group, a group of investment and health technology companies.
His bail conditions prevent him from contacting NeuMedix’s co-founder and director Anthony James Dickson.
NeuMedix is involved in a program at Griffith University’s botanical medicine for population health, which is developing herbal medicine to treat dengue fever.
Wickenby investigators allege from 2006 Mr Issakidis, through a complex unit trust structure, over-inflated the prices of Australian patents once they were transferred offshore and claimed corresponding depreciation expenses of $63 million.
They further allege these funds were laundered through an account in Britain and accounts in Hong Kong before being transferred back into Australia.
Mr Issakidis will reappear in the Downing Centre Local Court on August 7.
A MILLIONAIRE Gold Coast businessman accused of a $67 million money laundering and tax evasion scam has been denied bail, despite offering to be put under house arrest and pay a $250,000 surety.
Michael Issakidis, 67, faced Southport Magistrates Court on the Gold Coast today after being arrested by federal agents at his waterfront mansion on Tuesday.
His assets including his home and four Rolls-Royces have been seized and he was barefoot and in handcuffs when he appeared in the dock.
Commonwealth prosecutor Kylie Ward opposed bail, saying Mr Issakidis was a significant flight risk.
Ms Ward said while ‘significant’ assets had been frozen, Issakidis still had access to $11 million in unaccounted funds.
Defence lawyer Peter Shields said his client was willing to abide by strict conditions if he was granted bail to answer the charges in Sydney’s Downing Centre Local Court next Tuesday.
These included paying a $250,000 surety, reporting twice a week to police and not reapplying for his passport.
“He is willing to stay almost under house arrest,” Mr Shields said.
He said Mr Issakidis had been in a committed relationship since 1971 and had substantial ties to the Gold Coast.
However, magistrate Gary Finger said the charges facing Mr Issakidis were “serious” and involved “a serious amount of money”.
He refused bail and remanded the businessman in the custody of an Australian Federal Police officer for extradition to Sydney.
April 24, 2012
EXCLUSIVE: POLICE and tax office investigators today seized more than $40 million in luxury assets linked to prominent businessman Michael Issakidis and one of his associates.
Baby John Burgess at Ian Turpie’s recent funeral in Sydney’s North Ryde. Picture: Gary Graham PerthNow
They allege the arrest of the Greek-born property developer and company director has dismantled a multi-million-dollar tax evasion and money laundering scheme.
Mr Issakidis was recently in the news for successfully suing friend and Wheel of Fortune game show host Baby John Burgess for rent he claimed Burgess owed him for living in his 71st-floor Gold Coast penthouse.
Burgess and his wife Jan were regulars on the Gold Coast social scene with Mr Issakidis and his wife Donrecka before a court ordered Burgess to pay Mr Issakidis more than $30,000 in back rent and costs.
Mr Issakidis, 67, was today charged with conspiring to deal in proceeds of crime worth $63 million and defrauding the Australian Tax Office of tens of millions of dollars. The proceeds of crime charge relates to the tax fraud.
Prestigious vehicles grabbed from Mr Issakidis and an associate during today’s joint AFP and ATO raids in Queensland and New South Wales included four Rolls-Royces, a Lamborghini Spyder, an Aston Martin, a BMW and a Mercedes.
Also seized were a waterfront mansion on the Gold Coast, a luxury Sydney property in Northbridge and two yachts.
The AFP and the ATO conducted six search warrants in NSW and Queensland today as part of the continuing Issakidis investigation in Australia and overseas.
Further arrests relating to the alleged money laundering scam are possible.
Today’s raids followed a seven-month joint AFP and ATO Project Wickenby investigation and is the largest tax fraud probe since Wickenby was launched in 2006.
Project Wickenby involves the ATO, AFP, Australian Crime Commission, Australian Securities and Investments Commission, Australian Government Solicitor, the Australian Transaction Reports and Analysis Centre and the Commonwealth Director of Public Prosecutions.
The proceeds of crime action was undertaken by the Commonwealth criminal assets confiscation Taskforce. The AFP-led taskforce brings together resources from the AFP, ATO and the ACC.
This is the first time the AFP has conducted the litigation to restrain assets on behalf of the taskforce since legislation came into effect in January this year giving the AFP the power to commence and conduct proceeds of crime litigation. Mr Issakidis is the managing director of Queensland-based NeuMedix Health Group, a consortium of 16 investment and technology companies.
It will be alleged in court that through a complex unit trust structure, prices of Australian patents were over inflated once transferred offshore.
Corresponding depreciation expenses were then claimed and, as a result, a benefit of about $63 million was received over a three year period.
It will be further alleged these funds were then laundered through an account in the UK – and numerous accounts in Hong Kong – before being transferred back into Australia.
The scheme was identified by the ATO Trust taskforce, which was established to focus on arrangements to exploit perceived weaknesses in tax legislation for trusts.
ATO Commissioner Michael D’Ascenzo today claimed the operation uncovered a serious abuse of the integrity of the tax system and serious tax evasion involving hundreds of millions of dollars.
“Parties who rely on tax driven deals to justify the commercial viability of business transactions are on notice that we will use our anti-avoidance rules to deal with such schemes,” he said.
“The ATO will pursue all means available, including partnering with other law enforcement agencies, to respond firmly to these tax avoidance and evasion behaviours and protect the public revenue.”
AFP Commissioner Tony Negus said the operation combined the specialist skills of the AFP and the ATO to disrupt a complex money laundering scheme.
“Taking the profit out of crime is the aim of the criminal assets confiscation taskforce, which is targeting organised crime’s deep pockets,” he said today.
“This operation demonstrates the ongoing commitment by the AFP and its partner agencies to disrupt serious criminal activity.”
The Federal Government today congratulated the AFP on the seizure of around $40 million in assets believed to be the proceeds of crime generated through an elaborate tax evasion and money laundering scheme.
Minister for Home Affairs and Minister for Justice Jason Clare said today’s seizure was the result of a seven month joint operation – Operation Beaufighter – between the Australian Federal Police and the ATO.
“Organised crime is driven by money. Take away their money and assets and it reduces the incentive to commit crimes,” Mr Clare said.
“The Criminal Assets Confiscation Taskforce was set up in January last year to target the profits criminals make.
“Just like with Al Capone – you can catch criminals by following the money.”
This is the first time the Australian Federal Police has conducted litigation to restrain assets on behalf of the Taskforce since the legislation came into effect in January this year giving the AFP powers to commence and conduct proceeds of crime litigation.
Assistant Treasurer David Bradbury said the Operation was undertaken as part of Project Wickenby.
“Project Wickenby is successfully cracking down on the use of tax havens by those trying to cheat the system,” said Mr Bradbury.
“The establishment of the Taskforce has contributed significantly to the identification and restraint of proceeds of crime with approximately $70 million in assets restrained as a result of Taskforce investigations so far this financial year.
“This operation is the result of agencies working together to make Australia a hostile place for money laundering and large-scale tax avoidance and evasion.”
Project Wickenby brings together resources from the ATO, AFP, ACC, Australian Securities and Investments Commission, Australian Government Solicitor and the Commonwealth Director of Public Prosecutions and AUSTRAC with an ongoing commitment by these partners to make Australia unattractive for large scale tax evasion and avoidance and money laundering.
Mr Issakidis was expected to appear in Queensland’s Southport Magistrates’ Court today to face charges of:
Conspiracy to deal in the proceeds of crime of $1 million or more, contrary to Sections 400.3(1) and 11.5 of the Criminal Code Act 1995 – which carries a maximum jail term of 25 years.
Conspiracy to dishonestly cause a loss to a third person, namely the Australian Taxation Office, contrary to Sections 135.4(3) and 11.5 of the Criminal Code Act 1995 – which carries a maximum jail term of 10 years.
Michael Issakidis is the Group Managing Director for NeuMedix. A consummate statesman and pragmatist, Michael’s legal background coupled with many years of property developments provide the group with a tempered prudence when accessing opportunities.
With several successful ventures including the Cairns International Hotel, Australian Scenic Tours, a motel chain in Victoria and NSW, as well as many commercial and residential developments. Michael has established an enviable eye for potential and profit. He began his career as a Lawyer in 1968 establishing a practice with a distinct preference for contentious and adversarial matters. With the belief that a man is at his best when challenged, Michael will dissect the dilemma and strategise until a positive path forward prevails.
NeuMedix has taken an equity position in various innovative biotechnologies and inventions. Michael works closely with the scientists and inventors to ensure the integrity of the technology is not compromised. Through his network of professionals and colleagues he provides unprecedented exposure for our innovators to meet industry leaders and influencers.
Michael is an avid golfer, art collector and exotic car enthusiast. He graduated from Sydney University with a Bachelor of Arts Degree in 1965 and a Bachelor of Laws Degree in 1968.