Deputy Commissioner of the Australian Tax Office Michael Cranston allegedly borrowed and drove some of the expensive sports cars that his son bought with the proceeds of a tax fraud worth at least $165 million.
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The senior tax official, who was in charge of high-worth individuals and private groups, also allegedly sought to intervene in the investigation taking place and pressure colleagues to cut a deal with his son, sources said.
Mr Cranston learnt of the investigation after his son, Adam Cranston, approached him and said he believed his company, Plutus Payroll, was the subject of an inquiry.
Michael Cranston is alleged to have subsequently approached a Tax Office assistant commissioner, raising the possibility that his son's company was being targeted.
Sources say Mr Cranston snr told one of the assistant commissioners that his son was worried that he was being investigated. Mr Cranston said the case should be settled by some sort of resolution.
The Tax Office sometimes resolves matters by agreeing to receive a payment from those accused of tax fraud.
After that conversation, one of the assistant commissioners allegedly accessed the database.
The two high-ranking Tax Office officials who spoke to Michael Cranston about the inquiry have been stood down, pending further investigation, sources say.
It is understood that Michael Cranston allegedly inquired if a deal could be struck to resolve any probe.
Michael Cranston also allegedly sought to contact Tax Office investigators who were involved in the multi-agency probe. However, the Australian Federal Police had already warned them that such an approach might be likely, and to rebuff it.
Adam Cranston was allegedly involved in the unlawful tax fraud scheme from the middle of 2016, and sources said it had yielded $60 million in just three months. Investigators have said it was worth about $165 million, but it is understood the true figure is difficult to estimate.
Authorities are scrambling to seize more assets, but it is understood that they may not recover all the funds.
Michael Cranston is suspected to have been unaware that his son was the subject of the probe until Adam approached him, despite the massive wealth his son was accumulating.
"If ever there is a case for a national Independent Commission Against Corruption, this is it," said one source.
