Kent Nguyen has been sentenced to three years in jail after pleading guilty to orchestrating an illegal early release of a superannuation scheme.
In an announcement, the Australian Taxation Office (ATO) said the 51-year-old man was found to have unlawfully created, operated, and benefitted from a fraudulent self-managed superannuation fund (SMSF) named Tot Form Super Fund. It said the fund did not comply with the relevant protocol, procedures and requirements of super legislation to make it a legal SMSF.
He was found to have arranged the unlawful early release of super funds for 25 people in the community between 2007 and 2009.
“Many of the people were in financial trouble and were approached by friends who told them ‘they knew someone’ who could help,” the ATO said.
The 25 people had super held within a retail super fund and were rolled to Tot Form Super Fund, with the total amount of funds unlawfully withdrawn exceeding $700,000. Nguyen retained a significant portion of this amount and told his clients that the money had been paid to the ATO as tax.
ATO assistant commissioner, Ian Read, said: “While the majority of SMSFs do the right thing, this case serves as a reminder that there are severe penalties for those who attempt to cheat the system. Taking your super out from any super fund early without meeting a condition of release, or encouraging others to do so, is illegal.
“This case is also an important reminder for people to be aware of their super affairs, and their obligations. There are some very limited circumstances where you may be able to withdraw your super early, but generally you can only withdraw your super when you reach preservation age and stop working.
“Illegally accessing super early will cost people a lot more than the super they access and may get them into trouble as there are serious consequences for withdrawing super before they are legally entitled to do so. These consequences could include declaring the accessed amount as income in their income tax return, administrative penalties and disqualification from being a trustee.”