Exclusive: Multiple charges of wage subsidy fraud laid in court

Katie Bradford
Source: 1News

Seven criminal charges involving hundreds of thousands of dollars of taxpayer funds have been laid in court by the Ministry of Social Development, over alleged abuse of the wage subsidy scheme.

File picture.

And 1News can exclusively reveal more charges are set to come.

It comes as the Government on Monday announced 47% of all jobs were supported by the various subsidies provided by 2021, as lockdowns hit various parts of the country.

Charges relating to the seven cases have now been filed in the Auckland, Waitākere, Christchurch and Hāwera district courts and range from receiving, dishonestly taking or using a document and forgery.

One person pleaded guilty in February and repaid over $18,000. They are due to be sentenced later this year.

Social Development Minister Carmel Sepuloni told 1News there are always people who will misuse or abuse schemes, but she expects New Zealanders will rightly hold them to account.

A number of businesses have also repaid funds.

“Just under $800 million has been returned, those that haven't there's an expectation from the whole public of New Zealand that people would act with integrity,” she said.

Another eight criminal charges are set to be laid of wage subsidy abuse, and civil recovery action taken in another 11 cases.

The Serious Fraud Office is investigating ten cases involving larger sums of money.

The ministry warns there may still be further prosecutions.

The Ministry of Social Development's full statement:

We have filed criminal charges in seven cases of alleged abuse of the Wage Subsidy Scheme, involving $369,738.80 of public money.

Charges relating to these cases have now been filed in the Auckland, Waitakere, Christchurch, and Hawera District Courts. They involve a mix of receiving, dishonestly taking or using a document, and forgery charges. We will not be commenting on details of individual cases while they are before the courts.

One of these cases resulted in a guilty plea in the Auckland District Court in February when an individual admitted three charges of receiving wage subsidy funds they were not entitled to, totalling $18,745.60. They have since repaid the $18,745.60. MSD will not be commenting further on this case until after sentencing, which is expected to happen later this year.

MSD is also preparing criminal charges for a further eight cases of wage subsidy abuse and is progressing civil recovery action in another 11 cases. This is on top of ten cases involving larger sums of money and complex investigations that were referred by MSD to the Serious Fraud Office in October 2021.

MSD has now completed 14,525 pre-payment and post-payment checks on wage subsidy applications, resolved 5535 allegations of wage subsidy misuse, completed 528 wage subsidy-related investigations, and recouped $794.6 million in Wage Subsidy repayments.

MSD has carried out an extensive range of work in order to identify and check possible wage subsidy fraud or incorrect payments. Checks are underway, involving a mix of individuals and businesses, and we expect there will be more prosecutions to come.