AUSTRAC has produced a guide to identifying Illegal phoenix activity in the labour and payroll sector, explaining that this activity is when a company liquidates its operations to avoid paying its creditors, taxes and other regulatory payments. Before liquidation, it goes on, the company transfers its assets to a newly created company. The new company operates in the same, or similar industry and the same directors or close associates maintain control. The guidance specifically focuses on entities suspected of illegal phoenix activity, fraudulent taxation claims and money laundering activities pertaining to labour hire and payroll services. The introduction says that a recent report by PWC estimated the annual direct impact of illegal phoenix activity to be between A$2.85 billion and A$5.13 billion. Those targeting a specific market, the guidance may have more general application for assessing and avoiding risk.