National Disability Insurance Agency receives damning report on how it detects dodgy claims

An audit of the National Disability Insurance Agency’s processes for checking whether claims are genuine or not has delivered a damning report card.

The agency in charge of the NDIS has received a damning report card on how effective it is at detecting dodgy claims, despite the Albanese Government’s pledge to get the scheme “back on track”.

An audit of the National Disability Insurance Agency’s processes for checking whether claims are genuine or not, found it to be only “partly effective”.

In the report by the Australian National Audit Office (ANAO) released on Wednesday it found that while the NDIA has established processes to detect and respond to non-compliant claims, it is only “reviewing a small proportion of claims (0.4 per cent by dollar value) and detecting high levels of noncompliance (over 50 per cent by dollar value)”.

More than $41 billion worth of claims were made in 2023 to 2024, but those numbers are set to soar to $92 billion by 2033 to 2034. The agency has previously estimated that up to 10 per cent of claims could be non-compliant, fraudulent or incorrect.

Among the way taxpayers are being rorted include claims being submitted for illegitimate or ‘ghost’ participants and for people in prison, hospital or overseas. Other dodgy claims being made are for services not on a participant’s plan, claiming for services that were not provided and duplicating or overcharging, as well as double-dipping across government programs.

An audit of the NDIA’s processes for checking whether NDIS claims are genuine or not found it to be only “partly effective”. Picture: NewsWire/Brenton Edwards

“After identifying in 2023 that the NDIA was implemented with ‘catastrophically weak’ prevention controls, the NDIA has not yet established effective processes for preventing non-compliant claims,” the report said.

It also stated that the “NDIA has not established a fit-for-purpose framework for managing NDIS claim compliance”.

The report also found the NDIA Board to be non-compliant as it has not endorsed an updated Fraud and Corruption Control Plan to meet requirements.

The government has committed more than $495 million over eight years to 2029 for the NDIA to address NDIS fraud and noncompliance.

The report found that elements that could inform a more robust framework have been included in strategic planning documents for the NDIA’s Crack Down on Fraud program and the Fraud Fusion Taskforce.

It also said the agency is implementing a large program of work to remediate identified deficiencies, with a target completion date of December 2025.

“If this work is delivered as planned, and embedded into business-as-usual activities, it has the potential to improve the financial sustainability of the NDIS,” the report stated.

Ways the agency hopes to combat fraud is to introduce identity verification and claim validation processes and enhanced data analytics capabilities.

Muhammad Latif, sole director of banned NDIS provider Horizon SolSolutions.

The NDIA accepted all four recommendations by the auditor including updating its corporate compliance frameworks and risks assessments for fraud, as well as report on savings and benefits from compliance initiatives.

In response to the report the agency said over the last two years, it has been implementing an accelerated transformation to significantly improve the NDIA’s management of claimant compliance from a low level of maturity.”

“The NDIA will continue to progressively implement transformational change to safeguard the NDIS and protect participants’ plans, safety and wellbeing.”

Currently more than 630 Fraud Fusion Taskforce investigations are active.

One company still under investigation is Cocoon SDA Care which allegedly claimed for NDIS participants’ who were dead or in prison.

Director of the parent company Horizons SolSolutions Mohammad Latif has denied any wrongdoing or fraudulent activity.

Both his company and himself have been banned from the scheme.

Originally published as National Disability Insurance Agency receives damning report on how it detects dodgy claims