Millionaire businessman Michael Issakidis accused of $67 tax scam gets bail BUT


I just love it when they catch the big fish cheating the system

UPDATE 03/05/12

Businessman posts $1.5m bail but authorities hold onto $40m assets

May 3, 2012

Businessman Michael John Issakidis posts $1.5m bail but authorities hold onto $40m assets

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

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.

NeuMedix Directors

Michael Issakidis

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.

 

9 thoughts on “Millionaire businessman Michael Issakidis accused of $67 tax scam gets bail BUT

  1. Project Wickenby has charged (as of end of 2011) 65 people of which 22 people have been convicted, the overwhelming majority of whom pleaded guilty such as Wheatly. The majority like Paul Hogan were found not guilty. This has cost the tax payer hundreds of millions of dollars more then it has netted.

    The sensationalism surrounding the Issakidis case, and the blatant media marketing of its effort by the ATO is incredible. I have never seen media outlets camera crews allowed inside the accused’s home while they remove or seize property.

    The case is interesting as it surrounds VALUATIONS on medical intellectual property patents and their corresponding depreciation over the limited life (usually 10 to 20 years) of the patented technology. How can one determine or value a revolutionary new drug? some could say its worth $1000 some could argue its worth a billion.

    Does the ATO charge Glaxo or Pfizer for tax fraud when they value a patented new drug as being worth billions??? the big pharmaceutical companies support the campaign funding of the Labor party and dont drive Rolls Royces so I’m sure they say nothing.

    This case is not as black and white as portrayed and crucifying someone prior to their day in court is unjust and revolting, are we emulating China in this regard?

    What ever happened to “Innocent until proven guilty”??

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  2. Hello Gordon, very well said, you may be right, I think that large scale tax evasion or fraud is something that most Australians get pissed at,because they are slugging away week to week and hate seeing the big end get away with these things.

    So the media love grabbing onto these stories, one thing though, it is not about the money recovered at the end of the day.God, look what we spend on the so called war on drugs. it is about highlighting these rorts, some public humiliations and a warning to the big end of town, this is what will happen to you if you try and cheat the system!

    Whether it is just “Creative Accounting” or not will be decided in time I guess.

    I haven’t said he is guilty of anything…YET

    All the best to you

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  3. Issakidis and Dickson have not rorted the Australian people at all. Do you even know what it is you think they have gotten away with? It would take you probably a good 5 years to get your head around a structure such as this. At the end of it, noone has been rorted it’s just something deadheads are fed to cement support for the ATO’s gestapo unit. The ATO doesn’t want to lose face and have probably objected to the valuations placed on the patents in furtherance of a “tax fraud” claim, which is par for the course with the professional underachievers who work there. I have seen transactions such as this audited and believe me, the ATO rarely has a case because they are quite simply, not owed any money.

    Oh, and these guys are not the big end of town. They are what you call, the low hanging fruit.

    I actually feel for Issakidis as he really isn’t a very bright guy. Having said that, my personal experiences with him would show that he is a complete narcissist that thrives off the hard work and talent of others. pre-2004 Issakidis last semi-successful deal (some would term it a total failure) was in Cairns 20 years prior. He traded on that for 20 years. No doubt this time around he has ridden someones coat tails as he has absolutely no brain whatsoever for transactions such as this.

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  4. I don’t pretend to be a business savvy expert I just report on what I see as criminal, you see to know plenty and if support this kind of thing good on you.Time will tell what happens…

    So what do you think about Paul Hogan reaching a confidential agreement with ATO.If he was happy and won he would be shouting it out wouldn’t he? Must of cost him some?

    Regards

    http://www.smh.com.au/business/paul-hogan-settles-tax-dispute-20120501-1xvmo.html

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  5. I think to be fair the Paul Hogan settlement being confidential would have been to spare the blushes of the ATO – after such a massive PR effort anything less than a public execution in Tahir Square would have been a “lose” for our wonderful public servants. Its all too easy for these fine civil servants to enthusiastically throw darts at the wall, but it seems they are not always able to back them up.

    OTC makes some interesting points (and the choice of username is frankly inspired!) and has a fine turn of phrase. As for being low hanging fruit – I guess it’s a question of the ATO squishing the facilitators rather than the people that actually use the scheme. Apparently (this may not be reliable seeing as a copper told me this), the Feds are not challenging the valuation, but are claiming that somehow the money paid for the IP was substantially less than the contract price. Interesting concept – the Feds can decide to re-write any commercial contract signed by two parties and then charge anyone connected with it for committing a crime. Nothing like running rough-shod over the principals of law. Do we need a Magna Carta?

    If the ATO were actually trying to stamp this type of thing out, then I guess the so called big end of town would be rather empty and Australia would once again be the banana republic of yore.

    Still, unlike Wheatley and others, I suspect there’s a little more fight in these dogs than the Feds anticipate.

    And lets be quite honest, I wonder about a country that allows a government agency with prosecutory powers to “keep” the money they extort using that finest of stand-over tactic called the Proceeds of Crime Act prior to any guilt being proven. What was the quote from WWII? When they came for the communists (lets say), I said nothing; when the come for me, who will speak out (somebody can correct the quote).

    If this were some overseas nation we’d all be avidly reading about the lack of justice their citizens endured – the state can confiscate a citizen’s property before proving them guilty of a crime – really?? Perhaps the state is hoping that people so assailed give the game up. Oh wait, isn’t that what happened to Wheatley??? Didn’t he have a plea deal worked out which was rejected by the bewigged judge? Talk about getting royally screwed by the system – I’d rather take my chances in Somalia!!

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  6. Where’s the day in court for these poor saps to answer the charges that the ATO/AFP/Paramount Pictures (geddit??!!??) have levelled at them??

    Not that the AFP PR unit are going be talking about this aspect of it, but where is the justice in the Feds getting all kinds of asset seizure orders willy-nilly and then continually applying for extensions to delay their day in court?

    Weren’t we treated to the perp walk on the day in question?? Wasn’t Issakidis was dragged out of his house under the glare of the media who just happened to be assembled outside with cameras rolling and drooling maws quite by remarkable coincidence……

    If the case was cast-iron (as one would hope it was lest we are to think that these “fine” public servants had one too many Midori’s then played spin the bottle to identify their next victims), why have they delayed going to court?

    Could it be the Untouchables (really??; looking more like Reno 911 with every passing day boys) think they are movies stars (but what if they’re Hindu’s? Were they asleep during their religious sensitivity training or is this a cry for help??). Do they have a secret handshake and silly walk (which could be dangerous in those tight polyester suits lads!). Have they been watching that Coppers programme on Foxtel, and decided its instructional?

    When the government can basically take away a person’s livelihood, wealth and ruin their reputation, wouldn’t the man on the omnibus expect that the matter should be dealt with as quickly as possible? Whatever one thinks of these matters, 6 months is too long and begins to look more and more like oppressive behaviour from the authorities. Are they hoping those guys will crack under pressure or run out of money and lack the means to defend these most serious of allegations?

    There has to be some kind of time limit on these type of prosecutions, otherwise the authorities can make up any old story, present said offal in a secret hearing and then its bombs away!!! God help you if their random dialling software picks you!! For anybody who wants to believe that the legal system is fair, this is intolerable. I’m off to Zimbabwe where at least the white man can get a fair trial……

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  7. These are indeed interesting comments and would be somewhat valid if indeed they were complete or correct. Did nobody notice that that they were picked up under an investigation of unit trusts? & have been charged with tax evasion and money laundering through a number of countries and accounts it is alleged.

    Now if this was all so innocent and “normal” why the laundering of monies (oops, “moving” perhaps is a politer term at this stage) through multiple offshore accounts ?

    Clearly there is something to hide or do you think Issakidis and Dickson just wanted to create an aura of being “masterminds” and big swinging d*icks for their own amusement?

    Strange if that is what they were doing wouldn’t you think?

    If it was all so clean, they would pay their taxes like all Aussies do and have no issues as they do now. Seems delusions or grandeur and being above the law have caught these two lawyers out. The courts will sort this out.

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  8. Of course all of this is quite aside from Issakidis’s and Dickson’s well aired claims that they had a cure for cancer(s), AIDS (HIV), dengue fever, Herpes and who knows what else. All published and publicly aired internationally at several seminars and conventions and in various papers. Was this all just a front or do they genuinely have what they have claimed? Embarasssing for Australia if they don’t.

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  9. The third leg in this is Max Reynolds http://admedbiotech.com/store/index.php?main_page=index who claims openly and publicly that he has a Ph.D…he hasn’t got one. Ask him of you like.

    He has dropped this claim recently, but for the purposes of the NeuMedix scam with Dickson and Issakidis he claimed Ph.D status. When this was uncovered, Max employed another chap who genuinely had a Ph.D to fill the void.

    The whole thing stinks of scam. Guilty as sin, all of them. I trust the AFP are also looking very closely at ACE, BJ, Jas, & a few others.

    Really morons……..steal my identity, forge my signature over a thousand times, have me beaten and left for dead on my doorstep and then me to “Shut up and F*ck Off”…… Yeah, good luck with that. See you in court.

    All you moronic plebs who have posted above you are either friends of Dickson and Issakidis and thinking that posting here will make a difference or you so lacking in IQ that the world won’t notice when you implode due to the weight of your own insignificance. Reading this string is like reading “Oxygen Thieves” unite.

    Like

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