‘Too big’: NDIS fraud squad calls for police back-up to identify rorts and overcharging

Billions more taxpayer dollars are being lost through NDIS rorts and overcharging than previously thought, with the disability scheme crying out to police for help in stopping the fraud.

Billions more of the massive taxpayer-funded NDIS budget is potentially being lost through rorts and overcharging than previously thought, with the disability scheme crying out to police for help in stopping the fraud.

NDIS officials are understood to have privately briefed police across the country that the real scope of fraud could be as much as $8bn, plus billions more in overcharging — and that nobody knows exactly how much is being lost.

The federal government has publicly estimated NDIS fraudsters rort $2bn every year, with everyone from mums and dads to organised crime syndicates getting their noses into the trough.

The scale of the problem is not only so big, but to a large extent so unknown, that the NDIS investigators attached to the Fraud Fusion Taskforce late last year briefed all state police forces and asked them to increase the work they do to crack down on fraudsters, while also highlighting how significant the overcharging issue remains.

“There are the criminals who deliberately rip the NDIS off with blatant fraud,” a police source said.

Police and NDIS fraud officers from Operation Pegasus investigating NDIS fraud. Picture: Australian Federal Police

“But then there are the genuine providers who overcharge and embellish to the eyeballs, so something for $80 will cost $800 when the NDIS installs it.

“The NDIS is admitting the problem is far too big for them, but it’s just far too big for anyone really.”

NDIS Minister Bill Shorten. Picture: Martin Ollman

When Labor returned to power in 2022, NDIS Minister Bill Shorten began cracking down on fraud in the scheme his party created.

While he refuted claims the true extent of rorting and overcharging was significantly higher than government figures, he has previously told The Sunday Telegraph he was under no illusions the “problem of fraud and rorts in the NDIS does go into billions”.

“I am the first government minister to seriously address this issue. If it had not been for Labor and me this problem would have continued to be in the too-hard basket,” Mr Shorten said.

“Nearly every participant on the scheme is fair dinkum, but there is an unacceptably high number of service providers ripping off people with disability and taxpayers.

“The annual report stated that detected payment errors, including fraud, in 2023-24 represented 4 per cent of scheme costs.”

Operation Pegasus officers remove a car as part of an NDIS investigation. Picture: Australian Federal Police

In 2023, the government also made it illegal for NDIS providers to charge a higher than market price without justification.

But despite these changes and the efforts of NDIS investigators to encourage the AFP, state police and law enforcement, to help with the fraud issue, NDIS head of integrity John Dardo last year told a Senate hearing: “We just cannot prosecute or audit our way out of this.

“There are weaknesses in the design of the system that need to be addressed … the end game can’t be prosecution.”

Opposition NDIS spokesman Michael Sukkar said: “It’s high time Anthony Albanese is honest with taxpayers on the true levels of NDIS fraud.”

Police and NDIS officers have joined forces to uncover NDIS fraud. Picture: Australian Federal Police

Shocking stories have surfaced of fraudsters dividing their families into carers and clients, who can charge the NDIS for a trip to the supermarket – and be paid to walk away with groceries.

When the AFP did prosecute a trio from Western Sydney last year, a judge swiftly sent each of them to prison.

Highlighting just how lucrative NDIS fraud can be, husband and wife Mohammad Ali Mahmoud Sallam and Noura Bader, along with French national Jugurtha Zafrane, pocketed more than $5m in three years.

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Originally published as ‘Too big’: NDIS fraud squad calls for police back-up to identify rorts and overcharging