Seven people have been charged against a fraudulent sexual abuse compensation claim scheme that allegedly earned more than $1 billion.
New South Wales Police claims that “farmers” are approaching former young offenders, prisoners and public school students and file fraudulent compensation claims for historic child sexual abuse during care I encouraged him to do so.
The claims have been brought against the NSW Community, the Department of Justice and the Department of Education.
Police said they were instructing future claimants on how farmers would make fraudulent claims through various Sydney law firms.
The proceeds are reportedly known as “butt money” within the detective syndicate. Police said they suspected a “slight portion” of the $1.3 billion worth of claims was fraudulent.
Detective Director Gordon Albinja told reporters Thursday that the charges were “the tip of the iceberg” and “we're incredibly incredibly trouble here.”
“One-third of the inmates at the Cooma Correctional Centre have filed a request and we intend to investigate this,” he said, adding that “several” law firms are being investigated.
On Wednesday, detectives executed a search warrant in Girraween and arrested a 55-year-old man charged with 21 crimes. He was denied appearance at Parramatta District Court on Thursday. There, police claim he is the farmer of the plan.
Arbinja alleged that the man filed compensation claims on behalf of others and reduced each of the claims he introduced.
“There was a low threshold, but there is still some threshold,” detectives said, so some claims would have been rejected. Police were not trying to increase the threshold to bolster the process.
“NSW police support legal victims,” he said. “They should be compensated, and that's why the system was introduced in the first place. The problem is that the system is porous and the system needs to be strengthened.”
Five other people were arrested and charged with publishing false or misleading materials to give them an advantage. These include a 53-year-old Granville woman, a 32-year-old Pendle Hill man, a 52-year-old Horseley woman, a 35-year-old Pendle Hill woman, a 42-year-old man. Arrested at Glazeville Police Station.
A 23-year-old man from Mermaid Beach, Queensland, has also been issued a notice of future court attendance for the same charge.
Arbinja claimed that his 23-year-old father was also involved as part of a “victim advocacy group,” and had been under police investigation since February last year, but is now dead.
Police argue in court that the seven accused were standing to earn $3.75 million on fraudulent compensation claims, but the scheme was discovered before these were paid.
Arbinja is a “syndicated head, like other 23-year-olds, if not hundreds of thousands of dollars” through the scheme, with a “syndicated head” He claimed that it was.
The Guardian understands that in addition to reducing each claim he allegedly introduced, the 55-year-old also filed his own claim for compensation.
Police also executed a search warrant at a Sydney law firm and seized documents that said were related to the investigation.
They said the investigation is ongoing and more arrests are expected.
