Dozens Charged with Participating in a Criminal Group

Dozens of people have been arrested and charged by police for participating in a criminal group, many of whom are parents with young children with no prior criminal record.

Almost 40 people have been arrested in the Western and South Western suburbs of Sydney in recent months, in relation to an alleged day-care fraud ring which defrauded the government of $4 million.

Police have described the operation as “more disciplined than an outlaw motorcycle gang”, alleging it was set up in 2014 with the intention of defrauding the Federal Government’s child care subsidy.

Lubna Al-Hashimy was arrested earlier this week. She is the wife of Alee Farmann, the alleged mastermind behind the operation who was one of 17 people charged in May over their roles in the alleged fraudulent family day care business.

16 mothers have also be arrested for allegedly giving their children’s identities to be used by Red Roses Family Day Care Pty Ltd, a company said to be masquerading as a day-care company.

Fake child care business

Police allege the business was phony from the ground up, that it created false staff timesheets and rostering, mock children’s play areas and advertised using photographs of children who were never actually in care to fraudulently claim benefits.

They allege that children were even posed at a mocked-up child care facility during government inspections.

Under the Federal Government scheme, a subsidy is paid directly to home day-care providers to be passed on to families as a fee reduction. Families then make a co-contribution to their fees by paying the provider the gap payment – that is, the ‘difference’ between the fee charged and the subsidy amount. Police say that in the Red Roses network, parents operating fake home day-care centres would allegedly provide their own children’s identities to be lodged on the books of another facility and vice-versa, despite none of their children ever being cared for by the other.

Subsidies were then allegedly paid back to the business and filtered down through the syndicate, amounting to $4 million in 10 months. One property claimed to be caring for 50 children at a time, when it was in fact a small garage that was without electricity for 22 days earlier this year.

Alee Farmann, the registered director of the business was taking home a salary of about $30,000 a fortnight that he used to purchase luxury cars and real estate. In May, he was charged with directing a criminal group. He is on bail and will next appear at Liverpool Local Court later this month.

His wife, Lubna Al-Hashimy, also been charged with directing a criminal group and a number of other women who allegedly provided their children’s identities to the syndicate have been charged with participating in a criminal group. None have entered a plea.

The charges

Section 93T of the Crimes Act 1900 makes it an offence punishable by up to five years in prison for a person to participate in a criminal group while they:

• knew, or ought reasonably have known, it was a criminal group, and
• knew, or ought reasonably have known, that their participation in that group contributed to the occurrence of any criminal activity.

The maximum penalty increases to 10 years in prison where a person participated in a criminal group by directing any of the activities of the group.

The same maximum applies to a person who assault another or destroys or damages their property or threatens to do so, intending, by that action, to participate in the criminal activity of a criminal group.

The maximum increases to 14 years where a person assaults a law enforcement officer while he or she is in the execution of their duty, intending by that action to participate in any criminal activity of a criminal group.

And the maximum is 15 years where a participant’s activities are organised and on-going, and they direct any of the activities of the group knowing it is a criminal group, and knowing, or being reckless as to whether, his or her participation contributes to the occurrence of any criminal activity.

What is a ‘criminal group’?

Section 93S of the Crimes Act defines a ‘criminal group’ as 3 or more people who have as their objective:

• Obtaining material benefits from conduct that constitutes a serious indictable offence (offence carrying a maximum penalty of more than 5 years), or
• Obtaining material benefits from conduct engaged in outside New South Wales (including outside Australia) that, if it occurred in New South Wales, would constitute a serious indictable offence, or
• Committing serious violence offences, or
• Engaging in conduct outside New South Wales (including outside Australia) that, if it occurred in New South Wales, would constitute a serious violence offence.

Many of the people who have been charged by police are parents with no criminal histories, who allegedly handed over the Centrelink Customer Reference Numbers in exchange for cash payments, in circumstances where those numbers were used to facilitate the criminal activity.