The scale of fraud by businesses who exploited the Government's Covid-19 wage subsidy scheme is still slowly being revealed.
Thus far, almost 25,000 wage subsidy payments - totalling over $820 million - have been returned to the Government.
Digging deeper, 39 people have been brought before the courts in relation to more than $3 million in payments, whilst civil recovery action is being taken against 40 businesses.
The $18.8 billion wage subsidy scheme was first introduced when Covid-19 first hit more than three years ago, but prosecutions of the most flagrant fraudsters remain ongoing.
The Ministry of Social Development continues its investigation into those who ripped off the scheme, which was pushed out to support businesses when Covid hit. (Source: 1News)
The "high-trust scheme" was rushed out in March 2020 to help businesses stay afloat amid the country's first pandemic lockdown.
The Ministry of Social Development now has 50 full-time staff working on cases of wage subsidy fraud, with eleven cases of "significant and complex fraud" referred to the Serious Fraud Office so far. There are also still 900 investigations underway.
Social Development Minister Louise Upston said she expects the ministry to recover the money from those who have been overpaid or committed fraud.
“They’ve got more work to do, that’s what we would expect,” she said.
One of the latest cases including fraud, involved a husband and wife who ran a concreting business and illegally claimed nearly $100,000 in wage subsidy payments.
They failed to appear in court for sentencing and are now facing up to seven years in jail.
Five people have received prison sentences for their involvement in wage subsidy fraud, whilst seven others received home detention.
The longest sentence of two years and three months was handed down last week to a man who doctored a driver’s license and created 25 identities to claim over $25,000.
MSD general manager of debt and integrity Josie Smiler said the ministry was working closely with Inland Revenue to verify business and income information.
"In every instance where we see serious or deliberate misuse, we are following up."
She added: "We talk with applicants first, regarding their eligibility to the wage subsidy - there's a number of checks and balances that go alongside that."
Meanwhile, some of the biggest companies in the country have already voluntarily repaid millions of dollars in subsidies. The top ten include The Warehouse, Silver Fern Farms, Noel Leeming, and Sky City.
Smiler warned: "We don't have an end deadline for the work to be completed."
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