The national tax watchdog has uncovered a prolonged fraud by a regional accountant who misappropriated more than $900,000 in clients’ funds over three years. The Tax Practitioners Board (TPB) investigation found that Randolf Rindfleish, based in Coolah, New South Wales, diverted Australian Taxation Office refunds from 58 clients between July 2020 and September 2023 into bank accounts he controlled.
Mr. Rindfleish orchestrated the scheme by lodging fraudulent business activity statements, income tax returns, and JobKeeper forms under the tax agent numbers of two firms where he worked, the TPB said. In its findings, the TPB determined Mr. Rindfleish targeted 22 clients at Coolah Tax and Accounting, siphoning almost $150,000 between April 3 and September 22, 2023. The TPB found he also stole more than $750,000 from 49 clients at Wollongong Business Accountants (WBA) between July 2, 2020, and March 27, 2023.
Regulatory Actions and Consequences
The TPB has taken decisive action in response to these findings. Denis Yeo, the director and supervising agent for both companies during those periods, failed to implement proper controls, breaching the Code of Professional Conduct under the Tax Agent Services Act 2009, the TPB said. Consequently, the TPB has banned Mr. Yeo from registering as a tax agent for three years and shut down Coolah Tax and Accounting, citing serious breaches in supervision that enabled Mr. Rindfleish’s prolonged exploitation of the tax system.
WBA, however, has retained its registration as neither Mr. Yeo nor Mr. Rindfleish is still associated with it, and the current director had no knowledge of their arrangement. Mr. Rindfleish was not a registered tax agent himself, but that was not a red flag, according to TPB chair Peter de Cure.
“The staff of a registered company are not all required to be registered. But any company with a registration has to have adequate supervision and control provided by registered agents,”
he told the ABC.
Impact on Clients and Broader Implications
The TPB’s regulatory powers only extend to sanctions against registered agents, leaving the victims of Mr. Rindfleish’s fraud in a precarious position. The TPB said victims of the fraud experienced “significant adverse impacts,” but Mr. de Cure declined to discuss specifics or what level of compensation — if any — they might receive under the firm’s professional indemnity insurance.
“You’ve got a set of circumstances where, one your money’s gone missing, and two you’re in trouble with the ATO … so you can imagine the level of stress that would cause,”
he said.
In its determination, the board stressed zero tolerance for misconduct, which posed a direct threat to the integrity of the tax system.
“The TPB considered that it must take a very firm approach in cases of this nature to send a clear message to the practitioner community,”
it said. Mr. Yeo’s cooperation and “genuine remorse” mitigated his penalty from a possible five-year ban, the upper limit for the TPB’s regulatory powers, Mr. de Cure said.
Future Outlook and Legal Considerations
The announcement comes as the TPB continues to emphasize the importance of maintaining trust within the tax system. The implications of this case extend beyond the immediate financial losses, highlighting the need for robust regulatory oversight and the potential for criminal investigations. A NSW Police spokesperson told the ABC the force was aware of the fraud but declined to confirm whether it was investigating criminal sanctions against Mr. Rindfleish.
This development follows a series of high-profile fraud cases that have prompted calls for stricter regulations and more rigorous enforcement of existing laws. The move represents a significant step in the TPB’s ongoing efforts to safeguard the integrity of the tax system and protect consumers from fraudulent activities.
As the situation unfolds, the TPB and other regulatory bodies will likely face increased scrutiny regarding their capacity to prevent similar incidents in the future. Meanwhile, affected clients are left to navigate the challenging process of seeking restitution and rebuilding trust in the financial services sector.
