About 150 Australian Taxation Office staff have been investigated over suspicions they took part in a social media scam worth $2bn.

In an auditor general’s report on fraud management of the GST, the tax office revealed it sacked some employees and launched criminal investigations into others who were linked to the widespread rort.

The ATO workers were investigated as part of Operation Protego, set up to target people who benefited from fake GST refunds.

The operation was set up after the tax office received a large increase in refund fraud tipoffs, as well as an increase in the number of Australian business number and GST registrations.

Social media videos also offered advice on how people could claim more money through GST refunds.

The auditor general’s report said those suspected of claiming false GST refunds had tried to claim amounts between $38,900 and $2.4m.

The ATO workers were investigated as part of Operation Protego, set up to target people who benefited from fake GST refunds.

The operation was set up after the tax office received a large increase in refund fraud tip-offs and an increase in Australian business numbers and GST registrations.

Since the operation was set up, more than $2bn had been reclaimed by the tax office, while a further $2.7bn was stopped from being transferred just before payment was made.
As of August 2023, more than 100 arrests had been made, with 16 convictions.

The report said 150 tax office staff were suspected to be among more than 57,000 people who tried to claim the false refund. The ATO staff were investigated by the ATO’s internal fraud team.

“The ATO has identified 57% of individuals involved in the fraud were in receipt of a government benefit,” its report said.

“Approximately 30% of individuals attempted to obtain a fraudulent refund a second time and 10% attempted a third time.”

“A range of treatment strategies have been applied by the ATO, including termination of employment and criminal investigations.”

More than $120m of financial penalties have been issued to people found to have taken part in the fraudulent scheme.