It worked like this:
The alleged scammers took control of Plutus Payroll Australia,a company that provided a payroll administration service for legitimate clients,large corporate employers.
Those clients would regularly transfer funds to Plutus to pay the wages and salaries of employees. Plutus was also expected to withhold and remit to the ATO the required PAYG contributions.
But the alleged scammers set up several other second-tier companies into which they installed unrelated small-time crooks and drug addicts as company directors,or straw directors. This was to allow the scammers to disguise their involvement in the conspiracy. One of the alleged co-conspirators was assigned to recruit and manage the straw directors to ensure they had no unsupervised involvement in the companies they were supposed to be running.
Plutus would then transfer the payroll funds to the second-tier companies - from where it would pay the client companies'payroll as expected,but it would only forward part of the PAYG contributions to the tax man. The alleged scammers would ensure both Plutus and the second-tier companies would retain a percentage of the funds owed to the ATO as PAYG. They would aim to pass on no more than 60 per cent of the PAYG owed by any company.