People could be excused for thinking it was April Fools Day yesterday in Sydney. Paul Hogan was in town promoting his new film Charlie & Boots at the Intercontinental Hotel. Meanwhile a couple of hundred metres away at the Federal Court in Queens Square Justice Arthur Emmett was hearing submissions from Hogan’s lawyers on how much the Australian Crime Commission (ACC) should pay them in costs on their botched investigation into tax fraud claims by the commission.

Instead of promoting his new film Hogan ripped into the ACC and tax office clowns who have pursued him without success over the last few years. As well as demanding an apology from the failed authorities he even jokingly suggested he would launder the proceeds from his new film venture.

Putting a cat amongst the pigeons the Daily Telegraph then ran an erroneous yarn on their website titled “Paul Hogan off ACC hook but Tax Office picks up trail” written by Janet Fife-Yeomans, which detailed how the ACC had completely dropped their case against Hogan. Other media outlets including the ABC quickly picked up on the yarn and soon my phone was ringing hot from media friends wanting to know if the story was true.

Of course it wasn’t and soon after the ACC put out a statement confirming such. The Daily Telegraph immediately expunged the unfounded piece from their homepage (but not off the site) as did other confused media outlets. Let’s hope Media Watch was watching!

All this would be funny of course if it wasn’t so serious. Taxpayers are going to have to foot the bill of a multi million dollar payout to Hogan to cover his legal bills. The ACC have had to return a plethora of documents that were illegally seized as part of their investigation. It has been suggested that Hogan’s lawyers are demanding up to $5 million dollars in legal costs to be awarded to them. The matter has been adjourned until December.

In another embarrassing admission the court also heard that many of the documents illegally seized were mistakenly deleted from the ACC’s database because of a technical glitch. Crikey has also heard that another Wickenby suspect, Dr Graham Kelly, was asked by the ACC to comment on an email sent to an off shore entity. It’s understood Kelly didn’t know how to respond as the email outlined a complex recipe for chicken soup. It seems the ACC’s record keeping is in a shambles.

One of the issues to be decided by Justice Emmett in December is whether officers who have seen the illegally obtained documents should still serve on the investigation. Francois Kunc SC demanded the officers should be replaced. I agree and this action is not without precedent.

An ATO report written by an assistant commissioner eight years ago said that one leading tax consultant had eight auditors removed from various tax audits he was involved in. That’s one tax consultant.

The tax office is very flexible about removing auditors from complex cases if a complaint is received from the other side. So instead of wasting more taxpayer funds in arguing the issue in court tax chief Michael D’Ascenzo and ACC CEO Alistair Milroy should just put some fresh faces on their investigation team. God knows they need them.

Peter Fray

Get your first 12 weeks of Crikey for $12.

Without subscribers, Crikey can’t do what it does. Fortunately, our support base is growing.

Every day, Crikey aims to bring new and challenging insights into politics, business, national affairs, media and society. We lift up the rocks that other news media largely ignore. Without your support, more of those rocks – and the secrets beneath them — will remain lodged in the dirt.

Join today and get your first 12 weeks of Crikey for just $12.


Peter Fray
Editor-in-chief of Crikey