Multi-agency investigation reveals foreign worker exploitation in ACT and NSW construction industries

After a 2.5-year investigation, four Chinese nationals have been charged and sentenced for collectively withdrawing more than $137 million since their arrival in Australia to facilitate cash payments to foreign workers being exploited in the NSW and the ACT construction industries.

The Australian Border Force-led investigation by the Serious Financial Crime Taskforce (SFCT) was dubbed Operation Underpitch and involved multiple agencies across the country, including the ATO, AFP, ACIC, AUSTRAC, ASIC, the Department of Home Affairs and Services Australia.

The AFP, with the assistance of the ABF and ACIC, conducted a joint operation in Sydney’s south-west in October 2021.

This resulted in the arrest of a 30-year-old Chinese national, who was later sentenced to three years and two months imprisonment for his role in dealing with property reasonably suspected of being proceeds of crime.

Following AFP arrests in 2021, the agency’s Criminal Assets Confiscation Taskforce restrained $4 million in accounts and other assets.

Further investigations revealed that an ACT-based target had received electronic payments from eight Canberra-based construction and painting businesses from September 2020 to January 2022.

Illegal Worker Warning Notices were issued to the directors of five businesses on 31 March 2022, following employer awareness campaign visits.

ABF, ACT Policing, AFP and ACIC officers then executed search warrants at a Canberra location on 11 May 2023, in relation to the employment of unlawful non-citizens.

During the search officers identified 12 Chinese nationals, of which 10 were lawful non-citizens but two were unlawful non-citizens.

AFP detector dogs also located $82,000 in cash, and evidence such as identity and financial documents indicating the employment of unlawful non-citizens and suspected exploitation of foreign workers was also seized.

The search also revealed the use of cash payments to foreign workers in the construction industry while simultaneously avoiding superannuation and PAYG tax.

A civil penalties infringement notice of $49,500 was issued by the ABF.

As a result of these operations, three other Chinese nationals have been convicted.

A 22-year-old Chinese national was sentenced to 12 months imprisonment for dealing with property reasonably suspected of being proceeds of crime on 24 April, while a 27-year-old received 15 months jail for a similar charge on 29 May.

A 55-year-old Chinese national also received a criminal conviction and was fined for her involvement in money laundering, tax evasion and foreign worker exploitation in the construction industry.

ABF Commander Special Investigations Penny Spies said these investigations sent a strong message to criminals that agencies would continue to work side-by-side to stop these illegal practices.

“Dishonest employers in the construction industry often pay workers in cash, meaning employees miss out on entitlements including superannuation. All workers deserve fair pay and fair treatment,” she said.

“Criminals who want to profit by engaging in visa and migration fraud, money laundering, tax evasion and foreign worker exploitation are firmly in our sights.”

ATO Deputy Commissioner and SFCT Chief John Ford explained that individuals who take part in financial crime activities were often complicit in larger criminal activities.

“These criminals are motivated by financial gain and their activities rob the Australian public of revenue to support essential services such as health and education,” he said.

If you are aware of foreign worker exploitation, or any suspicious or illegal immigration, visa, customs and trade activity, contact Border Watch.