Exploitation of business structures

Criminal exploitation of business structures involves using unlawful business practices, and both simple and complex business structures, to conceal the criminal infiltration of an industry. This enables businesses to maintain or expand market share, and generate and/or conceal profits.

Organised crime groups operating in Australia enable a range of criminal activities through the use of both simple and sophisticated networks of businesses, proprietary companies, partnerships and trusts. These criminal activities are mainly money laundering and revenue and tax fraud, as well as crimes involving:

  • illicit commodities
  • people smuggling
  • investment and superannuation fraud.

Professional facilitators help criminal groups to operate seamlessly across licit and illicit markets. Organised crime groups make use of the specialist skills, knowledge, expertise and resources these facilitators can provide.

Complex business structures can effectively hide beneficial ownership behind layers of companies and trusts in multiple offshore jurisdictions, obscuring the ultimate destination of funds.

Exploiting business structures harms the economy through lost tax revenue, and provides these illicit businesses with an unfair competitive advantage. This undermines industry standards and damages industry culture. Costs to the community include government expenditure on new legal requirements for licensing and listing businesses.