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A four-year jail sentence handed to a Toowoomba construction company director sounds as a warning to operating "phoenix" companies. Roger Lilley, 49, of Toowoomba, was sentenced in the District Court to four years with eight months to serve after pleading guilty to defrauding the Commonwealth of $723,000. Lilley was sentenced for his part in two phoenix companies, Candid Hire and R Lilley Construction, of which he was a sole director. Phoenix companies accumulate debt then go into liquidation before 'rising from the ashes' and creating a new company. Acting Tax Commissioner Michael D'Ascenzo says the ATO is focusing on stamping out phoenix companies. "This scrutiny of phoenix companies is resulting in improved compliance, with the Tax Office raising an extra $140 million in tax and penalties over the last four years," D'Ascenzo says. "Since 1998, the Tax Office has had a major project underway to tackle phoenix practices. Results so far include 300 cases finalised and a further 150 investigations in progress. "These practices are a threat to honest business people as phoenix companies typically try to undercut legitimate businesses who pay their fair share of tax."