On 18 December 2020, the Federal Court of Australia sentenced Brisbane based Kent Scott Hacker to seven and a half months in prison. He, and his related companies, were also fined over $640,000 for multiple offences under the Tax Agent Services Act 2009 (TASA).
The Court granted the Tax Practitioners Board's (TPB) request for permanent injunctions against each entity, restraining Mr Hacker, One Stop Global Staffing Pty Ltd (OSGS) and Naleview Pty Limited, from further provision of unregistered tax agent services. Mr Hacker was also restrained from providing BAS services whilst unregistered.
It is a welcome outcome after a protracted investigation and litigation, during which Mr Hacker continued to act illegally.
This saga commenced when the Australian Taxation Office (ATO) raided OSGS offices in November 2018 and uncovered evidence validating ATO suspicions that Mr Hacker had been preparing and lodging tax returns for thousands of taxpayers whilst unregistered with the Board. The TPB acted swiftly on the information, and by February 2019, had launched a Federal Court action against Mr Hacker and his two companies.
During the proceedings, Mr Hacker gave an undertaking to the Federal Court that he would stop providing tax agent services to clients for a fee or other reward. Intelligence from the ATO confirmed that despite this undertaking, he continued to provide services to clients. The TPB, concerned of the potential risk to the public, successfully sought a court order forcing Mr Hacker to display large notices at the OSGS offices warning taxpayers of the risks of using Mr Hacker's services.
In June 2020, the Federal Court ruled that Mr Hacker and his businesses had repeatedly been in contempt of court. The court also found that Mr Hacker had contravened the TASA 45 times and his two companies 42 times.
Chair of the TPB, Mr Ian Klug AM said, 'The TPB will act firmly against those that act outside the law and supports the imposition of the penalties handed down to Mr Hacker and his associated companies. For nearly two years, Mr Hacker has brazenly and consistently ignored court orders and his behaviour has put his clients at risk and undermined the integrity of the taxation system. The TPB will continue to target unregistered preparers to ensure the professional and ethical standards of the tax profession is maintained.
'The sentencing, fines of over $640,000 and the imprisonment of Mr Hacker, sends a strong message to other rogue advisers and the community that illegal acts of this nature will not be tolerated.'
About the Tax Practitioners Board
The TPB regulates tax practitioners in order to protect consumers. The TPB aims to assure the community that tax practitioners meet appropriate standards of professional and ethical conduct.
