Staff reporterDecember 7, 2020
The Gold Coast millionaire businessman and property developer Michael Issakidis has been sentenced to a decade in jail for his involvement in a $135 million tax evasion case, the largest ever successfully prosecuted in Australia.
Issakidis and his co-conspirator, former Ernst & Young executive Anthony Dickson, used a web of companies to evade corporate tax.
The Supreme Court of NSW handed Issakidis the jail sentence, including a non-parole period of seven years and six months, on Thursday.
The frail 73-year-old faced a sentence hearing in the NSW Supreme Court after a jury found him guilty in June last year. There had been four trials.
The Federal Revenue Minister Kelly O'Dwyer said it was the "largest and one of the most complex investigations into tax fraud in Australia's history".
Issakidis had been allowed to return to his Sovereign Island mansion after posting bail of $1.5 million in 2016.
But the authorities held on to more than $40 million in assets including his prestige vehicle collection of several Rolls-Royces, a Lamborghini and an Aston Martin along with two yachts, which were seized during the Australian Federal Police raid (pictured above and below).
Issakidis was arrested at his waterfront mansion and charged with conspiracy to deal in the proceeds of crime and conspiracy to dishonestly cause a loss to the Australian Taxation Office.
The Federal Police allege Issakidis committed tax fraud through his medical company Neumedix and funnelled company funds through offshore accounts.
He initially faced Southport Magistrates Court, where he was refused bail and extradited to Sydney. He’d then been granted bail on the condition he live at his Paradise Point home.
The Australian Federal Police and Australian Tax Office said the arrest was after a seven-month investigation under Project Wickenby, the federal government's pursuit of wealthy alleged tax evaders.
The website of NeuMedix said Michael Issakidis was the commercial connoisseur for NeuMedix.
“A consummate statesman and pragmatist, Michael's legal background coupled with many years of property development provides a tempered prudence when assessing opportunities.”
After their move from Sydney, his wife, the Gold Coast socialite Donrika, once starred in a memorable 60 Minutes segment on the A-List on the Gold Coast in the 1990s. With a downwards sweep of her hand, she indicated she was dressed in "Chanel, Chanel, Chanel."
Issakidis and his wife were unconscious in their car after he failed to turn up to court to be sentenced last October. They were discovered after 22 hours by his brother, Con.
Crown prosecutor Michel McHugh SC noted in court, referring to a psychiatric report, that Issakidis said he was not depressed and that when the couple attempted suicide "we were just two people who wanted to be together".
It's expected he'll apply to be transferred to a Queensland prison on welfare grounds.
The businessman's barrister, Mike Smith, noted that Dickson had been found to be "the predominant player and motivating force behind the conspiracy.
Dickson was in 2015 sentenced to 11 years' jail, which was later increased to 14 years on appeal. His sentence was the longest ever handed down for tax fraud and money-laundering.
The pair created a web of false identities to aid their deception and siphoned money through the UK, Hong Kong and the UAE via fake domestic and international companies. They deliberately absorbed $450 million of otherwise assessable income through falsely created losses in order to evade $135 million. They profited to the tune of $63 million, spending the money on lavish lifestyles.
The complexity of the offshore companies involved and the fact they were based in secrecy jurisdictions such as the Cayman Islands made the investigation difficult, but sources described the AFP officers involved as "relentless" in the pursuit of both Dickson and Issakidis.
At the centre of the scam was Neumedix Health Australasia Pty Ltd. Issakidis and Dickson caused Neumedix to fake losses on the acquisition of medical technologies. They then used those losses to avoid tax on income generated on the ownership of units in a number of trusts.
"These trusts generated very large taxable profits from their participation in certain financing transactions that were arranged between the offender, ANZ and some of its clients," according to court documents obtained by the Australian Financial Review.
