One flood victim contacted Yahoo Finance to complain about people cheating the system set up by the Federal Government to provide immediate financial relief for flood-stricken communities.
“I did get affected by the floods. But does the Government have any idea how many people are just ringing to get the $1,000?”, the flood victim asked.
“Anyone can apply, it's gone viral. Ring, answer a few questions, no proof, and you get $1,000.”
Harsh penalties for people who make fraudulent claims
She said the vast majority of people getting the payments were people who needed it.
“However, there are always a minority of people who do try to cheat the system,” she said.
People who continually rort government payments face steep penalties.
Two people living in Melbourne were over a series of fraudulent COVID-19 Pandemic Leave Disaster Payments, totalling $54,000.
Reynolds said the Government has “very sophisticated intelligence and investigation capabilities” to detect fraud and prosecute people, which had been used successfully in the past.
She said it was a “balancing act” to make sure people got support quickly in times of need, without leaving the door wide open for scammers.
Bureaucrats had a process of flagging suspicious claims upfront, she said, and then investigated the dodgy claims later.
Reynolds said people could call 131 524 to report a suspected fraud.
‘Something needs to be done’
People took to social media to share their experiences.
One commenter spoke of someone applying for the payment who lived in a flood-affected suburb but had “no flooding or damage whatsoever”.
“They claimed the $1,000 and bragged about how easy it was, and this is just one local government area, something needs to be done.”
Others pointed out that there were always people willing to take free money.
“Tell us something we don’t know. This sort of deceiving and rorting has been going on for decades,” another commenter wrote.