The Australian Tax Office and the Australian Securities and Investments Commission have conducted raids on 13 businesses and residences across the country in a bid to crack down on “pre-insolvency” firms that advise clients on how to avoid tax, SmartCompany.com.au reported. Some 120 ATO officers teamed up with their ASIC counterparts on Thursday to collect documents and records from the Melbourne and Gold Coast properties, which are linked to two advice firms that authorities allege are encouraging and facilitating tax avoidance, GST evasion, and “phoenix” activity. Phoenix activity is where a indebted company is liquidated, only for the assets to be transferred to a new company under a different name. This relieves the failing company from having to pay creditors, employee entitlements or tax. The ATO and ASIC believe “pre-insolvency” firms are using public databases in order to identify struggling companies, and cold-calling them to offer “pre-insolvency” advice, reports The Australian. The advice offered can relate to how to “phoenix” the company, which can result in directors spending time in prison. Read more.