Family day care fraud syndicate dismantled

Australian Criminal Intelligence Commission, Department of Education and Training, New South Wales Crime Commission, New South Wales Police Force

Detectives investigating family day care fraud have dismantled an alleged criminal syndicate after executing more than 20 search warrants and charging 18 people yesterday.

In July 2018, detectives from the Financial Crimes Squad and Organised Crime Squad, along with the Australian Government Department of Education and Training and the Australian Criminal Intelligence Commission (ACIC), established Strike Force Mercury to investigate the coordinated fraudulent activities targeting family day care operations.

The strike force has also been assisted by the NSW Department of Education and NSW Crime Commission.

Police will allege in court that the syndicate fraudulently claimed Commonwealth payments under the Child Care Subsidy schemes.

It will be alleged the syndicate fraudulently claimed at least $3.8 million in payments annually.

As part of ongoing investigations, Strike Force Mercury detectives executed 22 search warrants at properties across south-west Sydney and one property in the Illawarra yesterday (Wednesday 8 May 2019).

Investigators were also assisted by officers from across State Crime Command, Strike Force Raptor, the Public Order and Riot Squad, and South West Metropolitan Region Enforcement Squad.

During the operation, a total of 18 people, including three men – aged 24, 40, and 49 – and 15 women – aged between 21 and 44 – were arrested and taken to local police stations.

Three people – a 49-year-old Georges Hall man, a 43-year-old Bass Hill woman, and a 44-year-old Sadleir woman – were charged with knowingly direct activities of criminal group.

The 24-year-old man was later released pending further inquiries, while the other 14 people were charged with participate in a criminal group.

During the searches, police seized large volumes of documentation, including business records, a Range Rover, $35,000 cash, and two electronic control devices.

The Department of Education and Training also issued the business a 'Notice of Immediate Suspension'.

State Crime Commander, Acting Assistant Commissioner Stuart Smith, said the syndicate was operating an entirely illicit business.

“It is not uncommon for investigators to uncover fraud as an element of organised criminal activity, but the sophistication and coordination of this group is possibly better than the average outlaw motorcycle gang,” Acting Assistant Commissioner Smith said.

“Their ‘business’ is exploiting a government scheme that was established to relieve financial pressures of everyday mums and dads; and the victim is every tax payer in the country.

“Unfortunately, we know that serious and organised crime syndicates do not concentrate their fraudulent efforts on one scheme alone – we saw similar activities in the CTP insurance scheme frauds.

“As we believe this syndicate is only the tip of the iceberg, the dismantling will serve as a warning for anyone involved in a similar syndicate; we are onto it and we’ll be coming for them,” Acting Assistant Commissioner Smith said.

Financial Crimes Squad Commander, Detective Superintendent Linda Howlett, praised the coordinated work of investigators.

“This investigation was particularly complex, and the assistance of other agencies has been vital to follow all lines of inquiry,” Det Supt Howlett said.

“Detectives have already spent thousands of hours investigating how the fraud worked and the activities of the illicit business and yesterday’s operation follows 10 months of dedicated and passionate work.

“Our investigators still have a long road ahead of them, examining bulk documentation and data, and working our way through other potential syndicates.

“The next phase of this investigation will also see Strike Force Mercury investigators working with the Australian Tax Office and the Department of Home Affairs,” Det Supt Howlett said.

A spokesperson for the Australian Government Department of Education and Training said the department works to track, detect and take action against individuals and organisations who engage in fraud.

“Collaboration across the Commonwealth and state and territory governments to identify and take action against people who commit crimes is a feature of ensuring the integrity of child care payments,” the spokesperson said.

“In recent years, 29 people have been charged with criminal offences in relation to child care payment fraud and 21 people have been found guilty to date, with several cases still before the courts. Yesterday’s arrests add to this tally.”

Joint investigations under Strike Force Mercury are ongoing.