Reducing illegal phoenix activity
Government agencies are working together through the Phoenix Taskforce to protect public revenue, businesses and employee entitlements by reducing illegal phoenix activity.
Illegal phoenix activity is when a new company is created to continue the business of an existing company that has been liquidated to avoid paying taxes, creditors and employee entitlements.
Illegal phoenix activity includes:
- non-payment of wages, superannuation and other entitlements
- getting an unfair competitive advantage over other businesses
- non-payment of suppliers
- loss of government revenue and increased monitoring and enforcement costs
- avoidance of regulatory obligations.
Illegal phoenix activity impacts the entire community as revenue lost could have contributed to hospitals, roads, education and other essential services. We are committed to reducing this activity and prosecuting offenders.
The Phoenix Taskforce comprises 37 federal, state and territory government agencies, including our own. The taskforce takes a whole-of-government approach to combatting illegal phoenix activity.
How are we addressing fraudulent phoenix behaviour?
We administer the Fair Entitlements Guarantee (FEG). FEG is a safety net scheme to provide assistance for certain employee entitlements after employees lose their job due to bankruptcy or liquidation of their employer. The information we collect through the claim assessment process can provide useful intelligence about the corporate activities of employing entities. We routinely provide this data to the Phoenix Taskforce to form part of the sophisticated cross-agency data matching undertaken to identify, monitor and manage suspected illegal phoenix operators.
The Fair Entitlements Guarantee Act 2012 provides us with statutory authority to share information collected in the claim assessment process with other Australian Government agencies. Where potential breaches of the law are identified during the FEG claim assessment process, we also refer such conduct to regulatory agencies.
All reports and tip-offs about suspected phoenix activity are forwarded to the Phoenix Taskforce, a cross-government taskforce dedicated to stamping out illegal phoenix activity.
The taskforce takes all reports seriously. Due to privacy laws, it is unable to inform you of the outcome of the information you provide, or provide updates on progress.
Want to know more?
- If you suspect an illegal phoenix operator, you can report it online by completing a Tip-Off form available from the ATO website, or by calling 1800 060 062. For more information, visit Illegal phoenix activity.
- For information on how to make a complaint to the Australian Securities and Investments Commission (ASIC), visit the report misconduct section of the ASIC website.