Compliance

Child Care Subsidy Fraud uncovered, five people charged in Melbourne

Freya Lucas

Nov 20, 2020

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Five members of an accused Melbourne crime syndicate have been charged with defrauding the National Disability Insurance Scheme (NDIS) and the Child Care Subsidy (CCS) of $800,000.

The charges came following a two year investigation by the Australian Federal Police (AFP), which identified a 50-year-old mother of seven as the syndicate's alleged principal offender, who is accused of using welfare programs for personal profit.

Federal Minister for Education Dan Tehan said the Federal Government does, and will continue to, take strong action against ‘shonky operators’ who try to rort Australian taxpayers.

"Our Government is cracking down on child care fraud,” Mr Tehan said.

"My message to anyone thinking of trying to rip off the Australian taxpayer through the child care system is – don't, because we will come after you."

The woman and four co-accused appeared in Melbourne Magistrates' Court earlier this week and were charged with conspiracy to defraud, dishonestly causing loss to another person, obtaining financial advantages through deception and proceeds of crime offences. They are due to reappear in court on 2 March, 2021.

The operation, known as Operation Persei is a joint agency investigation with Services Australia; the Department of Education, Skills and Employment (DESE); and the National Disability Insurance Agency (NDIA).

The woman at the centre of the case has a child with a disability who is on an NDIS plan. She is accused of spending some of the NDIS funds allocated for her child on herself, including helping to buy a new home in Whittlesea.

In addition to the alleged fraudulent use of funds, the woman has also been accused of fraudulently obtaining government benefits by employing her live-in partner, a 30-year-old man, as the carer for her children.

AFP investigators allege the man instead worked at his hair dressing salon, and the child care subsidy rebate was used to employ nannies for their home. A 32-year-old woman from Meadow Heights and a 31-year-old woman from Coburg also claimed benefits to care for the principal offender's children, but it is alleged the pair never provided the care, or it was not within DESE guidelines.

She is also accused of setting up a NDIS provider business, and with another NDIS provider, a 52-year-old woman from Melton, using their businesses to exploit people with a disability for profit.

The AFP alleges the businesses set up NDIS plans that could be purposely defrauded. It means six people with a disability did not receive the full level of care they were entitled to.

Overall, the syndicate is said to have defrauded taxpayers of about $800,000, with those involved facing jail terms if convicted.

"The AFP works tirelessly with agency partners to protect taxpayers' money by ensuring the integrity of the welfare system,'' AFP Commander acting Assistant Commissioner Krissy Barrett said.

"Stealing from Australians is a crime but defrauding funds from those who rely on additional support is abhorrent.”

The full breakdown of charges can be found below:

The 50-year-old, Whittlesea based woman:

Conspiring with diverse others with the intention of dishonestly causing a loss to another person, contrary to subsection 135.4(3) of the Criminal Code 1995 (Cth).
Dishonestly causing a loss to another person, contrary to section 135.1(5) of the Criminal Code 1995 (Cth).
Conspiring with another with the intention of dishonestly causing a loss to another person, contrary to section 135.4(3) of the Criminal Code 1995 (Cth).

Two counts of Aid, abet, counsel or procure the commission of an offence against subsection 135.1(3) of the Criminal Code 1995 (Cth), with the intention of dishonestly causing a loss to another person, contrary to subsections 11.2(1) and 135.1(3) of the Criminal Code 1995 (Cth).
Aid, abet, counsel or procure the commission of an offence against subsection 135.1(3) of the Criminal Code 1995 (Cth), with the intention of dishonestly causing a loss to another person, contrary to subsections 11.2(1) and 135.1(3) of the Criminal Code 1995 (Cth).
Dishonestly obtain a financial advantage by deception, contrary to s82(1) of the Crimes Act 1958 (VIC).
Submit false information with the intention of dishonestly causing a loss to another person, contrary to subsection 135.1(3) of the Criminal Code 1995 (Cth).

The 30-year-old Lalor man:

Conspire with another with the intention of dishonestly causing a loss to another person, contrary to section 135.4(3) of the Criminal Code 1995 (Cth).
Dishonestly obtaining a financial advantage by deception, contrary to s82(1) of the Crimes Act 1958 (VIC).

The 52-year-old woman from Melton:

Conspiring with diverse others, with the intention of dishonestly causing a loss to another person, namely the National Disability Insurance Agency, which is a Commonwealth entity, contrary to subsection 135.4(3) of the Criminal Code 1995 (Cth).

The 32-year-old woman from Meadow Heights:

Between 8 January 2019 and 9 March 2019, at Melbourne in Victoria, submitting false claims for the provision of child care services, with the intention of dishonestly causing a loss to another person, namely the Department of Education, Skills and Employment, which is a Commonwealth entity, contrary to s135.1(3) of the Criminal Code 1995 (Cth).
Between 27 August 2018 and 7 February 2019, at Melbourne in Victoria, submitting false claims for the provision of child care services, with the intention of dishonestly causing a loss to another person, namely the Department of Education, Skills and Employment, which is a Commonwealth entity, contrary to s135.1(3) of the Criminal Code 1995 (Cth).
Between 2 July 2018 and 11 August 2018, at Melbourne in Victoria, submitting false claims for the provision of child care services, with the intention of dishonestly causing a loss to another person, namely the Department of Education, Skills and Employment, which is a Commonwealth entity, contrary to s135.1(3) of the Criminal Code 1995 (Cth).

The 31-year-old woman from Coburg:

Between 7 September 2018 and 17 November 2018, at Melbourne in Victoria submitted false claims for the provision of child care services, with the intention of dishonestly causing a loss to another person, namely the Department of Education, Skills and Employment, which is a Commonwealth entity, contrary to s135.1(3) of the Criminal Code 1995 (Cth).

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