Auditor-general uncovers rising NDIS fraud allegations

Authorities are dealing with a major rise in tip-offs about suspected fraud in the National Disability Insurance Scheme, with the auditor-general revealing investigations are underway in 20 fraud cases totalling almost $10 million. 

An auditor-general report said while the National Disability Insurance Agency’s approach to fraud was “largely comprehensive”, there were some risks not appropriately considered including self-managed participants and the upcoming transition of provider registration to the NDIS Quality and Safeguards Commission.

The report found there had been a substantial increase in public tip-offs since the NDIS Fraud Taskforce was launched in July last year to protect the scheme from rorts and the grasp of organised crime.

Tip-offs to the NDIA rose from around 150 a month last July to almost 350 a month in February this year.

The NDIA advised the auditor-general there were currently 20 active fraud investigations, with an estimated value of $9.3 million.

The agency is also in the process of deregistering 25 family day care providers that have been sanctioned by the federal education department. These providers had already received $2.3 million in payments from the NDIA.

Australian Federation of Disability Organisations CEO Ross Joyce told Pro Bono News he was concerned by the level of fraud identified but wanted to make it clear this was not done by people with disability.

“It is by third parties and generally involves fictitious claims made for some or all support services to people with disability who are NDIS participants,” Joyce said.

“They are shamefully ripping off not only the NDIS, but people with disability who need their approved supports, that’s just disgraceful.”

The audit follows last month’s arrest of an organised crime syndicate for allegedly stealing millions of dollars from the NDIS to buy luxury cars. 

Joyce said it was not surprising that the $22 billion scheme would be seen as an attractive target for unscrupulous individuals and organised crime syndicates.

He said the NDIA needed to ensure that protections were in place to prevent fraud from happening in the first place, rather than investigating after a scam had already hurt people with disability.

The NDIA has agreed to all of the auditor-general’s recommendations, including to improve its active fraud detection methods by urgently improving its data analytics and data matching capabilities.

NDIA chair Grant Herir said there had been a major “focus and effort on risk management” over the past 18 months, with a number of steps already taken to address the recommendations.  

Joyce welcomed this commitment, but said AFDO would like to see a timetable detailing when each of these areas will be addressed.

“This is to give further confidence and certainty to people with disability, their families, supporters, representative organisations, stakeholders, service providers and the wider Australian community,” Joyce said.

“We would also like to see independent audits undertaken in this regard on a regular basis, to ensure that the integrity of the NDIS is maintained, protected and that people with disability can continue to receive all of the approved supports that they require.”