South Australian café owner sentenced to 6 years’ imprisonment for GST fraud

Between March 2014 and January 2016, Shaun Both (the offender) was a sole trader of Metro Express Café at Mawson Lakes in South Australia. In that time, he lodged 9 quarterly Business Activity Statements (BAS) with the ATO. As a result of false statements in the BAS, in circumstances where the café had ceased trading, the offender dishonestly obtained $1,001,004 in Goods and Services Tax (GST). In January 2016, the offender used some of the last GST refund to purchase a $530,000 residential property outright. 

Following an investigation by the ATO, the offender was charged with the following offences:

• nine counts of obtain financial advantage by deception, contrary to section 134.2(1) of the Criminal Code (Counts 1-9); and
• one count of knowingly dealing with money that is proceeds of crime ($100,000 or more), contrary to section 400.4(1) of the Criminal Code (Count 10).

He first appeared in the Magistrates Court of South Australia in 2019 but then absconded to Western Australia after failing to appear in court in April 2020 when he was subject to home detention bail. In December 2023, the offender was arrested on the outstanding warrant in remote Western Australia and extradited back to South Australia where he was remanded in custody. The offender pleaded guilty to all counts at a committal hearing.

Sentencing

On 5 August 2024, the offender was sentenced by his Honour Judge Muscat in the District Court of South Australia to a total effective sentence of six years and six months’ imprisonment, with a non-parole period of three years and eight months.

In sentencing the offender, his Honour Judge Muscat noted:

• The BAS lodgments “represented a sustained course of conduct which escalated in terms of the amounts dishonestly obtained over an almost two-year period”.
• Although the offender suffered from poor mental health, alcohol abuse and gambling habits and they were relevant to the background of his offending, they did not significantly reduce his moral capability or the need for personal and general deterrence.
• The offender had a prior history of dishonesty offending. He had previously received the benefit of suspended sentences and court-ordered medical treatment for his alcohol and mental health issues.
• It was clear that the offender “wanted to live a certain lifestyle and he certainly did that”. The offender gambled extensively, spent money at shopping centres and online, and “on things he did not really need other than to live the life he wanted”.
• The loss to the Commonwealth was significant, with only about $350,000 recovered by the ATO by way of garnishee and bankruptcy proceedings, with no realistic prospect of recovering further amounts.

His Honour gave the offence a 20 per cent discount for his guilty pleas. He noted that the case against the offender was “overwhelming” but he did save the time and expense of a trial.

His Honour directed (and the CDPP conceded it was appropriate) that the sentence for Count 10 be served concurrently on the sentence imposed for Counts 1-9 as the offence concerned expenditure of the final BAS refund.

Relevant links

ATO media release published 6 August 2024 Café owner’s bold brew in $1 million GST fraud