The department uses a variety of methods to identify fraud and serious non‑compliance. For example, it maintains an intelligence capability to carry out detection activities and shares information with other government agencies to identify possible cases of fraud. Where an investigation uncovers fraud, it may be referred to the CDPP for prosecution.

Intelligence capability

In 2018–19, the department conducted a variety of intelligence activities to detect and target potential fraud and serious non‑compliance associated with Social Security and Welfare, Child Support and Health programs. For example, the department:

• supported a number of joint taskforce activities
• tested and implemented new detection programs
• assessed tip‑offs from the public
• increased the department’s well‑established detection capability
• implemented prepayment detection activity and utilised controls to prevent inappropriate government outlay
• continued to develop intelligence tools to support department analysts and investigators
• used data analytics and data mining to improve and refine the department’s detection processes.

The department continues to work closely with a number of other Commonwealth, state and territory government agencies, including the Australian Transaction Reports and Analysis Centre (AUSTRAC), the Australian Criminal Intelligence Commission (ACIC), the CDPP, the Department of Home Affairs and the Australian Federal Police (AFP), to combat the threat of serious and organised crime.

Public tip-offs

Effective handling of tip‑offs from the public about potential fraud is a key element in maintaining community confidence in the integrity of payments. The department invests substantial effort to ensure tip‑offs are appropriately dealt with, using specialist staff to assess all tip‑offs from the public suggesting a person may be receiving a payment or benefit to which they are not entitled.

People can provide tip‑off information to the department by:

• reporting via the fraud page on the department’s website humanservices.gov.au
• phoning the Australian Government Fraud Tip‑off Line on 131 524.

In 2018–19, the department received more than 31,000 tip‑offs through the Australian Government Services Fraud Tip‑off Line and more than 59,000 tip‑offs from other sources.

Table 52: Public tip‑offs, 2016–17 to 2018–19

Digital forensics

The department uses forensic technologies and methodologies to support investigations. Real‑time risk profiling capabilities have also been developed to address online and identity fraud and prevent incorrect payments.

Optical surveillance

Optical surveillance involves observing people, vehicles, places or objects. The department uses optical surveillance where it is likely to assist in proving an allegation of fraud, serious child support avoidance or income minimisation. Income minimisation is the use of complex financial arrangements to reduce income for child support purposes.

In 2018–19, the department completed 56 matters involving optical surveillance

Fraud investigations

The department investigates fraud and refers appropriate matters to the CDPP for it to consider prosecution. The department’s fraud detection and investigative efforts are strategically focused on the most serious cases of fraud.

In 2018–19, the department assessed and investigated matters covering a range of fraud risks, including:

• undisclosed income or assets
• identity fraud
• undeclared family relationships
• residency and absence from Australia
• falsifying study information
• claiming for health services not rendered
• forged documents and claim forms
• falsified prescriptions.

In 2018–19, the department completed 2,408 evaluations and 921 investigations of fraud. Of the investigations completed:

• 752 related to the department’s Social Security and Welfare Program
• 157 related to the department’s Health Program
• seven cases related to Early Release of Superannuation Benefits
• five related to the department’s Child Support Program.

To support the investigation capability in a digital environment, the department enhanced its digital forensics capability through new detection technologies and recruiting extra staff. The department also further developed risk profiling capabilities to enhance its ability to address online and identity fraud and prevent incorrect payments in real time.

Internal investigations

The department’s Internal Investigations section is responsible for leading investigations of potential unauthorised access and internal fraud and corruption. This section works with internal and external stakeholders, including:

• the department’s Workplace Relations Branch on matters of employee misconduct
• the AFP on matters of criminal investigation
• the CDPP on briefs of evidence and referrals for consideration of criminal prosecution
• the department’s Programme Advice and Privacy Branch on matters of unauthorised access and disclosure and eligible data breaches
• the department’s Cyber Security Branch on matters of data security
• the department’s Security Branch to ensure that the physical and information security of both customers and staff is maintained.

In 2018–19, the Internal Investigations section undertook investigations into a range of issues, including:

• unauthorised access to customer information
• unauthorised access to personal administrative information
• falsification of documents
• fraud relating to leave and related entitlements
• assisting customers inappropriately
• unsecured external emails
• theft
• identity fraud
• undeclared family relationships
• fraud by staff, who are also customers, claiming for services not rendered.

Taskforce Integrity

Taskforce Integrity is a government initiative to change any localised cultures of non‑compliance and welfare fraud and positively influence people’s behaviour by encouraging self‑correction. The Taskforce identifies and targets geographical areas where data analysis and intelligence points to a higher risk of non‑compliance and welfare fraud.

The Taskforce, which started in November 2015, is a partnership between the department and the AFP. It draws on capability from across both agencies and is led by a senior AFP officer.

In 2018–19, the taskforce completed 28,359 compliance activities and referred 38 cases to the CDPP.

For the life of the measure, at 30 June 2019, the Taskforce has:

• completed 70,516 compliance activities, well exceeding the target of 50,431
• identified over $59.7 million of debt owed to the Commonwealth
• identified approximately 16,949 cases of overpayments
• distributed approximately 297,000 letters
• referred 136 matters to the CDPP.

In December 2018, the government announced it would extend the Taskforce by two years from 1 July 2019. The Taskforce’s focus has shifted to target those who are exploiting welfare programs, stealing or creating false identities to hijack payments, or using welfare programs to hide non‑legitimate income derived through criminal activity.

The Taskforce will be in a stronger position to actively recover debt owed to the Commonwealth through an expanded range of debt recovery methods. These include using Departure Prohibition Orders (DPOs), confiscating assets where there is unexplained wealth, and garnishing money owing to the department from concealed accounts in credit and cash seized through law enforcement activity.

The Taskforce will continue to refer matters to the CDPP where there is evidence of criminal behaviour.

Family Day Care Integrity Surge

The Family Day Care Integrity Surge (FDC surge) aims to support the Department of Education and Training and the AFP by helping to investigate and reduce the risks of fraud in the Family Day Care program. It commenced in July 2017.

In the first stage of the FDC surge, 150 of the highest risk family day care providers were removed from the sector.

In 2018–19, the FDC surge commenced assessing high‑risk service providers that transferred to the new Child Care System. The department will continue to work with the Department of Education and Training to identify high‑risk service providers and will identify customers who are working in the family day care sector who deliberately fail to declare their income while in receipt of welfare payments.

In 2018–19, the FDC surge completed 259 activities, resulting in $8,146,084 in debts raised.

National Disability Insurance Scheme Fraud Taskforce

In July 2018, the government established the National Disability Insurance Scheme Fraud Taskforce (NDIS Taskforce) to tackle potential fraud against the NDIS. The NDIS Taskforce is a partnership between the National Disability Insurance Agency (NDIA), the department and the AFP to investigate and prosecute serious fraud within the scheme.

The NDIS Taskforce comprises departmental staff, NDIA staff and AFP officers. The department has committed 15 full time equivalent staff members to the NDIS Taskforce. These resources are supporting investigations and intelligence activity as well as data analytics.

In 2018–19, the department contributed to capability building of the NDIA providing:

• experienced fraud analysts and investigators to assist the NDIA in their fraud detection and investigations
• education and training to develop and enhance NDIA’s data analytics, fraud detection, intelligence gathering and fraud investigation capability
• investigative procedures and documents to assist the NDIA to conduct investigations
• digital forensics advice and support to assist in technical evidence gathering, which included:
  • digital forensics support during search warrants
  • training for NDIA investigators on the analysis of digital evidence
  • advice on software and hardware requirements to adequately analyse digital evidence
• support for the development of a suite of analytical tools to develop fraud risk analysis capability
• assistance with investigative process mapping.

The department proactively releases protected information to the NDIA, where it has made the connection between people or entities that may have previously been involved in Family Day Care fraud and, after deregistration, have set themselves up as NDIS providers.

Both the NDIA and the department are members of the AFP Fraud and Anti‑Corruption Centre (FACC), which provides opportunities for the department to closely coordinate its efforts with those of the NDIA, the AFP and other members of the FACC to combat fraud in the NDIS and other government programs.

Whole-of-government engagement to combat crime

To ensure a strong response to fraud and serious non‑compliance, the department continues to work with a number of other Commonwealth, state and territory government agencies. In 2018–19, this included cooperation through:

• new information‑sharing arrangements
• combined intelligence activities and investigations
• engagement with overseas agencies
• proactive data matching relating to people of interest
• regular data matching
• active involvement in taskforces.

Information sharing and disclosure

The department regularly and proactively provides program‑specific protected information under authorisation or in the public interest to support a whole‑of‑government approach to combating fraud and serious and organised crime. The department also exchanges information with other agencies to target fraudulent and non‑compliant activity.

Australian Transaction Reports and Analysis Centre

AUSTRAC gives the department access to its records of significant or suspicious financial transactions. AUSTRAC and the department have developed an automated data exchange capability to supplement existing data acquisition and sharing arrangements. This capability increases the department’s access to AUSTRAC intelligence used to detect undisclosed income or target unexplained wealth.

Greater access to AUSTRAC intelligence has strengthened the department’s ability to address serious and systematic misuse of the welfare system.

Australian Criminal Intelligence Commission

The department provides ongoing support to ACIC to address the threat of organised crime. In 2018–19, the department continued to have an officer seconded to ACIC working in the Australian Gangs Intelligence Coordination Centre. As part of this arrangement the department received information and intelligence from ACIC on issues associated with social security and welfare fraud and serious non‑compliance.

Department of Home Affairs

The department provides ongoing support to the Department of Home Affairs to address the threat of serious and organised crime. The department began a secondment arrangement in 2018–19 to the Commonwealth Transnational, Serious and Organised Crime Centre. This secondment facilitates the department’s active contribution to national strategies and capabilities.

Australian Federal Police

The AFP contributes to the department’s fraud control capabilities. During the year, nine seconded federal agents worked in the department to help with investigations, including preparing and executing search warrants. The federal agents also provide training and advice to departmental investigators and coordinate access to specialist forensic services.

The department collaborates with the AFP on specific joint operations to investigate and disrupt larger scale organised crime against health and welfare programs.

The department is a member of the AFP‑led FACC. The centre responds to serious and complex fraud against the Australian Government, corruption by Australian Government employees, foreign bribery, and complex identity crime involving the manufacture and abuse of credentials. One departmental officer is seconded to the centre.

Commonwealth Director of Public Prosecutions

In 2018–19, the department and the CDPP continued to work together to respond to fraud against government programs.

Successful prosecutions are a critical component of the department’s fraud control, prevention and deterrence strategies. The CDPP plays a pivotal role in prosecuting alleged fraud matters that the department has detected and investigated.

During the year both agencies increased their focus on collaboration and innovation, including through mutual training, efficiency, and capability development initiatives.

In 2018–19, the department referred 600 cases to the CDPP. These included:

• 460 cases related to social security or family assistance payments
• 84 cases related to Health Program benefits
• 40 cases related to internal fraud
• 14 cases related to Early Release of Superannuation Benefits
• two cases related to Child Support services.

The types of fraud and serious non‑compliance threats that the department addresses continued to shift towards those driven by technological changes or involving unexplained wealth. The department continued to work with the AFP and state police forces on a number of complex organised frauds and online frauds.

Prosecution is not the department’s only response to fraud and serious non‑compliance. Not all cases are suitable for prosecution, particularly where there are evidentiary issues. The department can take a range of administrative actions to complement prosecution activity and tackle cases that cannot be prosecuted.

The department does not set targets for prosecution activity. Instead, it focuses on tackling fraud and serious non‑compliance threats holistically, quickly and cost‑effectively.