Inner workings of alleged $4m Red Roses Family Day Care fraud
As his subordinates pretended to care for each other’s children, the alleged figurehead of a multimillion-dollar childcare fraud drove a new Range Rover, lived in a luxury Sydney townhouse and pocketed $60,000 a month, police allege.
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As his subordinates pretended to care for each other’s children, the alleged figurehead of a multimillion-dollar childcare fraud drove a new Range Rover, lived in a luxury Sydney townhouse and pocketed $60,000 a month, police allege.
New details have emerged of the inner workings of the $4 million alleged Red Roses Family Day Care fraud, levelled by a major task force yesterday in 23 sweeping raids across south west Sydney.
Police allege 150 parents had signed up with Red Roses — led by 49-year-old director Alee Farmann — with each of them claiming federal subsidies for looking after between three and seven children.
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But police allege not a single child was actually in family daycare.
The parents would allegedly sign their children up for care at another syndicate member’s home as they themselves claimed massive government subsidies for other children who never arrived.
One woman had $35,000 cash in her handbag as she was arrested at her South Granville home yesterday.
Acting Assistant Commissioner Stuart Smith said the group went to enormous lengths to appear legitimate, even keeping photographs of children they claimed were in care and staging fake play areas.
“From outward looking in, it looked like a legitimate business, it created time sheets it had photographs of children … it had mock-up areas, it had an administrative structure, rostering like anything else in legitimate business,” Assistant Commissioner Smith said.
However, it will be alleged the whole thing was a fraud.
“There are legitimate children’s names and entities … they just weren’t being cared for. The whole thing was a structured business,” he said.
Police will allege “it was elaborate, it was sophisticated and they had systems to defeat audits”.
Police yesterday charged three people, including Farmann and 44-year-old Zina Mohammad, with directing a criminal group and 14 people with participating in a criminal group.
Police will allege those arrested yesterday were involved in senior roles in the syndicate.
“We will allege the director had a take-home pay of around $30,000 per fortnight from the fraudulent activity,” Assistant Commissioner Smith said of Farmann.
Neighbours said Farmann seemed like a pleasant man with a number of impressive cars, including a Range Rover.
“What we’ve taken out yesterday were the (alleged) professional facilitators behind this syndicate and we won’t rule out further interviews and we won’t rule out further significant arrests,” Assistant Commissioner Smith said.
“Each one of these parents had between three and seven children in care … however none of those were being looked after.”
He said police allege syndicate members also had sophisticated systems for warning each other when Department of Education auditors were doing the rounds.
“They had systems which would communicate to members of the group if there was a phone audit or a physical audit so they could get ready to defeat any of that activity,” Assistant Commissioner Smith said.
Police came across the alleged childcare syndicate through Strike Force Ravens, which investigated compulsory third party insurance fraud in 2016.
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