NDIS firm Cocoon SDA Care: ‘Untrained staff operated ventilators’

A disability provider earning $50m a year from the NDIS was sending out unchecked and untrained staff, a whistleblower alleged more than a year before the firm became the subject of a major investigation.

NDIS firm Cocoon SDA Care’s co-founder, former bankrupt Zaffar Khan.

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A disability provider earning $50m a year from the NDIS was deploying unchecked and ­untrained staff to operate ventilators and to administer insulin and other medication, a whistleblower alleged more than a year before the firm became the subject of a major investigation.

Two weeks after being made chief executive of Cocoon SDA Care, Tanya Quinn made a raft of serious allegations about the business’s operations to director Muhammad Latif.

In an email obtained by The Australian, Ms Quinn warned that the company presented “an immediate danger to vulnerable participants in the community”.

“You are not verifying staff identification in person or otherwise, not upholding Australian Privacy Laws, deploying unchecked staff to administer Insulin, Medazolam (sic) and operate ventilators without training,” Ms Quinn wrote to Mr Latif.

“Your staff are not qualified to deliver the level of support required by the participant and this is jeopardising the quality of care received.”

Further claims were made by another senior Cocoon manager, who could not understand how the business was passing mandatory NDIS audits when it was in such disarray, other leaked documents show.

Ms Quinn’s email to Mr Latif was sent on August 14, 2023.

Company co-founder Zaffar Khan, a former bankrupt, had only announced Ms Quinn as chief executive in an all-staff email two weeks earlier, on July 31. “As the new CEO, Tanya will lead the company’s growth initiatives as set by Zaffar Khan Corporate Strategist,” Mr Khan’s email stated.

Ms Quinn was alarmed that when she joined the company her identifying information was “sent unencrypted to an office located in Pakistan that is not mentioned or registered with ASIC to a man named Jack”, she told Mr Latif.

She added that she had “written evidence from your CFO about insolvency, misuse of funds and statutory debts unable to be paid”.

“He disclosed to many of your QLD staff that he suspects (wrongdoing); these staff went to your National HR Manager who has provided a comprehensive outline of events and his concerns,” she said.

Cocoon SDA Care former employee and whistleblower Tanya Quinn.

NSW staff were being underpaid in breach of employment laws, she added.

Managers advised her “you are not training staff and participants are at risk”, and were “mortified at the level of care and lack of training provided”, she stated.

“Zaffar is not making any changes and continues to hire for nonsense positions while your staff are underpaid and taxes unpaid,” she alleged. “From a quality and safeguards perspective Cocoon presents an immediate danger to vulnerable participants in the community.”

Ms Quinn claimed investors were being misled, and that the company had been “given legal advice against continuing to promise guaranteed returns”.

Mr Khan was a shadow ­director who was not a suitable person to operate a disability service, she alleged.

Financial reports “formally advised that the company is unable to meet (its) debts”. She wrote that the company’s midterm NDIS audit “bears no mention of the Pakistan Office or Key Personnel Zaffar who ­controls the company and has ­advanced himself cash, executes contracts and signs off on ­everything”.

“I have enough experience working with you both and ­evidence from staff that Zaffar is a shadow director and the staff have provided me with enough evidence to satisfy me that as a provider you are not meeting basic requirements,” she wrote. “Investors have ­approached me personally and advised that they have been misled and not paid. They too are willing to give evidence.”

Cocoon SDA Care executive director Pranay Kumar (left) and Cocoon's co-founder Muhammad Latif.

Ms Quinn had emailed Mr Latif earlier, asking him not to share the confidential correspondence with Mr Khan as he was not listed as key personnel.

“You immediately sent it to him,” she wrote in the August 14 email. “You then sent Fahmi Hussain into the Bella Vista office to tell me to leave my phone and laptop there and go away.

“We were both in the room when you and Zaffar conference called. I heard it. Zaffar said ‘We need to find a nice way to make this girl go away’.”

Ms Quinn said she had notified the NDIS Quality and Safeguards Commission, ATO, ASIC and federal police. She started sending messages to then NDIS minister Bill Shorten the same month, personally warning him about the company and seeking action, The Australian revealed on Tuesday.

It was more than a year before the National Disability Insurance Agency started a major investigation into Cocoon and its parent company Horizon Solsolutions in October 2024.

Horizon earned $53.7m from NDIS support services in 2024, up from $47.4m in 2023, its latest financial report states.

Mr Khan has denied wrong­doing and says staff raised “alleged issues and incidents” regarding Ms Quinn’s conduct that were ­investigated and her contract subsequently ended.

The company had a “strong internal complaints and reportable incident” scheme, he said.

Separately, another senior manager emailed Ms Quinn on August 4, 2023, just four days after she started as chief executive. The man had been hired by Cocoon that year and cited whistleblower policies and his obligations to report dishonest conduct and risks.

Within his first month there, he was approached by a colleague who had financial information and who believed there were ­irregularities in the company’s ­finances. He added: “Whilst I am not qualified or experienced to ascertain this, I believe that this ­employee is well experienced in this area and does have the expertise to make this kind of claim. The employee did note however, that they did not have complete ­financials and that they had formed this view based on what they had seen/shown me.”

The senior manager was aware of various staff appointments that were “largely due to family ­relationships or friendships of Mr Khan … These are largely, ­appointments of improper and incapable people, which are detrimental to (Cocoon) as a business”.

Mr Khan was ”for all intents and purposes … the director and final decision-maker in all matters relating to the company, including finances, daily operations and major business activity”, he said.

“I am aware through a search of ASIC records that Mr Muhammad Latif is the appointed director, not Mr Khan. In any regard, my experience with Mr Khan is that he is grossly negligent with the running of this company and that he is incapable of making sound decisions in the best interests of the company.”

The company was spending more than $2m a year on corporate wages that he believed were unnecessary. “I have never seen such excessive spending in any company, let alone one operating in the NDIS space,” he said.

“This is almost solely driven by Mr Khan and I have had very little to do with Mr Latif, despite him being the nominated director.

“Cocoon operates like no other company that I am aware of in this space, and it is beyond me how they remain viable. The only conclusion that I can reasonably come to is that something improper or misleading is occurring.”