Monaghan said the existing fraud detection system is, in some cases, becoming pre-emptive, adding that last year it saw one person deported within 12 hours after attempting to slip one past the ATO.

The ATO has released more than 300,000 digital certificates to tax agents in an attempt to create more stringent authentication procedures, but fraudsters are increasingly relying on social engineering tricks to circumvent them.

Monaghan said he has a grudging admiration for the effort the fraudsters are going to, stating there are often elaborate strategies in place to hide the trail of stolen identities that take a fair bit of time to unravel.

"Tax agents are a critical part of the system and we have found attempts being made, with some success, to steal details from accountants which are then used to take over their identity and other taxpayer's funds. An incident we saw was a trojan which appeared to steal tax data from a tax practitioner," Monaghan said.

"Often we see people putting a legitimate front on activities, using legitimate, unsuspecting accountants, and sophisticated phone answering systems. Like everyone, our concerns about online theft is where the information goes and then how it is used to defraud the ATO.