Company director dodged more than $2.3m tax
MORE than 100 former workers of two Mackay mining companies have avoided being dragged before a court after a Brisbane businessman confessed to dodging millions in tax.
William Robert Feeney, a qualified lawyer and accountant, was due to go to trial after avoiding paying the ATO more than $2.3 million in PAYG withholdings.
However, his guilty plea has cancelled out that complex and costly affair, which followed a thorough audit involving dozens of employee payslips.
The plea spared those who had worked for NMMS (National Mine Maintenance Services) Pty Ltd and NMG (National Mines Group) Services Pty Ltd from being called as witnesses.
Feeney, 35, dishonestly caused a risk of loss to the Commonwealth of $2,321,892 in the 2010 and 2011 financial years and is now bankrupt, divorced and stuck behind bars,
NMMS and NMG - which provided labour, plant services and maintenance to mining sites - are in liquidation, Mackay District Court was told.
ASIC lists NMG Services as deregistered, while NMMS is listed as in the midst of "strike-off action".
While the Australian Tax Office (ATO) was owed the massive sum, Feeney funnelled $1.4 million into a personal trust account to buy several investment properties.
They were purchased for more than $3.82 million and later sold for more than $6.3 million.
But Feeney put that eye-watering return into another investment, which completely failed, instead of repaying the PAYG withholdings tax to the ATO.
During auditing and investigations, after the ATO looked over 122 employee tax returns, Feeney lied to the tax office, falsified ASIC documentation and told a liquidator NMG was a start-up; even though it had operated since 2003 and had a turnover of about $20 million.
That ham-fisted, panicked attempt to cover his tracks - which Feeney later attempted to reverse - was evidently totally unsuccessful.
Feeney fronted the District Court for sentencing on Wednesday.
Commonwealth DPP prosecutor Aaron Guilfoyle described Feeney's "premeditated" tax avoidance as "high-level white-collar fraud" committed by a "highly regarded individual".
Though, he said Feeney's standing in the community was typical of those who commit similar white-collar crimes.
Mr Guilfoyle said Feeney's crime was aggravated because he wasn't desperate or destitute at the time, but was just looking to advance his business interests.
Feeney's criminal history was largely irrelevant, containing an entry of assault occasioning bodily harm, which occurred last year.
Defence barrister Tim Ryan (instructed by Howden Saggers Lawyers) said Feeney made an early plea and saved the hassle of a trial, which likely would have been drawn out, complex and costly.
More than 100 witnesses would likely have been called.
Moreover, Feeney was described as an obsessively ambitious divorcee who lived with depression after a tumultuous marriage breakdown.
Feeney picked up successful contracts around the time of his tax dodging, including at Anglo American Australia Moranbah North Mine, Mr Ryan said.
But as the companies grew and costs exploded he was "blinded by ambition" and prioritised expansion, rather than paying the ATO.
Judge Tony Moynihan QC said "the Australian Tax Office and by extension the community suffered a loss" as a result of Feeney's "very serious" tax dodging.
"The conduct started soon after you took over financial control of the companies. It was a deliberate course of conduct," he said.
"You had the money to make reparation, but directed the money to another investment.
"You knew what you were doing. You are a qualified legal practitioner and the accounts clerk raised with you your liability ... but was told false stories about how the money was being used."
The judge described Feeney as an "ambitious young man who bit off more than you could chew".
He considered Feeney's early guilty plea, character references and mental health issues, and said the Brisbane man was unlikely to commit a similar crime in future.
Feeney was sentenced to three years and six months jail, but will be eligible for parole after 14 months.
He showed little emotion and farewelled his partner, who supported him from the public gallery.
Feeney will also have to make repayments to the ATO, including penalties, of $2,807,843.
He will be banned from acting as director of any company for five years from the date of his release.