Phoenix Taskforce cracks down on dodgy operators


Ever seen a dodgy business intentionally build up debts and then shut down to avoid paying what they owe, only to suddenly pop back up as if nothing ever happened?

Maybe the problem starts small, like the occasional invoice being paid late. Then the business owner stops answering the phone when you call. Finally, you discover the business has folded and you won’t be getting paid at all…sound familiar?

It’s called phoenixing, and it’s illegal. Illegal phoenix activity can happen in any industry, including the transport industry.

Most of you probably know, or have heard of, someone who’s been affected by these dodgy operators. But not everyone knows what it’s called or what’s being done to help stamp it out.

The government established the Phoenix Taskforce in 2014 in order to help weed out illegal phoenix businesses and prevent them from doing further harm to the community.

The taskforce includes 38 state, territory and federal agencies working together to share intelligence and take coordinated action. Led by the Australian Taxation Office, the Phoenix Taskforce has raised more than $1.45 billion in liabilities from audits and reviews of illegal phoenix activities, and returned more than $670 million to the community.

The ATO’s Assistant Commissioner George Montanez, who leads the ATO’s phoenix response and coordinates Phoenix Taskforce activities, said the problem is far more than just a tax issue.

“Phoenix activity has a devastating and quite far-reaching impact. We regularly see subcontractors or suppliers who are left unpaid, after investing significant time and effort into a job,” Montanez told Big Rigs.

“And of course that can send many of these businesses to the brink, with flow-on effects for their subbies and workers. It’s often the little guys at the end of the chain who end up missing out because of the criminal acts of others.

“We also see employees being short-changed on wages, as well as entitlements including super. On top of that, it puts businesses who are working hard to do the right thing at a real disadvantage – it’s hard to compete when you’re up against someone who is underpaying their workers, not paying their subcontractors and suppliers, or not accounting for GST.

Montanez said it’s important to note that, while this is a big problem, the overwhelming majority of Australian businesses are doing the right thing.

“Our aim through the taskforce is to protect those businesses, and hold the small number of people who persist in ripping others off to account,” he said.

“That means, for the worst offenders, working to disrupt their business model, take away their profits and even take criminal action.”

Successful prosecutions

In 2019-20 the Phoenix Taskforce successfully prosecuted five criminal matters, as well as banning and disqualifying 11 directors from being involved in the management of a corporation.

Montanez said not all of the taskforce’s work is highly visible.

“A significant part of our strategy is communication, education and providing assistance to help business understand their obligations so that they can comply.

“Sometimes our work involves engaging with businesses to shift them into compliance. For example, previously we investigated a national road transport business group that were serial phoenix offenders, building up significant debts to employees and other creditors. By working together several taskforce partners were able to issue simultaneous garnishees to trade debtors, and collect a substantial amount of unpaid debt.

“That prompted the group to finally enter into payment arrangements with each agency, and as a result we were able to return more than $1 million to the community. The company director was also hit with a series of director penalty notices in relation to non-payment of employee entitlements.”

Montanez said the taskforce was particularly focused on stopping those who encourage others to engage in phoenix activity.

“We do see some suspicious ‘advisers’ who contact businesses that are in trouble and recommend ways they can shut down to avoid paying debts, or conceal assets, prior to winding up.

“I’d encourage anyone who is in business to think twice about taking advice from anyone who has contacted them out of the blue with pre-insolvency advice. The best way to ensure any advice you receive is legitimate is to seek out qualified, registered professionals to provide it.”

Last year also saw new legislation come into effect, which provides new criminal offences and civil penalties for those who, for example, try to avoid paying their debts by hiding their assets from liquidators.

Additional funding for the ATO and ASIC will also help tackle promoters and facilitators of phoenix behaviour. This includes establishing a new data capability that will uncover previously hidden relationships between “shadow” company directors and promoters, as well as facilitating targeted compliance.

What you can do

When it comes to avoiding phoenix operators, Montanez said his recommendation is to really know who you’re working with.

“That means doing some searches to find out about the company and its directors. Even asking for references and checking online for any negative media reports can make a big difference.

“You can also check with ASIC to see whether the company is registered, and make sure it’s not in liquidation or external administration.”

Steps like asking for upfront payments, cash on delivery or payments in instalments can help protect yourself.

You can also help protect yourself against illegal phoenix activity by knowing the warning signs.

“Watch out for businesses that suddenly ask for payments to go to a new company, or where you see changes to a company’s director and name, while the manager and staff stay the same.

“You should also be suspicious if you notice your payslip records a different employer name, you don’t get payslips, or your super isn’t being paid. If you’re unsure if you’re being paid super you can check it yourself by logging into your myGov account or asking your super fund directly.”

If you suspect phoenix activity, you can report it to the Phoenix Taskforce by:

  • completing a tip-off form at
  • phoning 1800 060 062
  • emailing

Protect yourself and find out more by going to

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