In this alert, Senior Associate Aaron Clark and Solicitor
Matthew Boyce discuss a recent decision of the Australian Capital
Territory Supreme Court. In this case, a worker in receipt of
workers' compensation benefits fraudulently asserted he was
unemployed in order to continue receiving approximately $65,000.00
in benefits, while he was covertly working as a taxi
Workers' compensation fraud has repercussions on all
customers of a scheme. It increases the burden on the taxpayer and
reduces available resources to spend on the genuinely injured.
In Queensland, like the ACT, those found guilty of workers'
compensation fraud may be subjected to custodial sentences and
There remains a positive obligation on employers and insurers
to report fraudulent, false or misleading information.
The defendant was an employee of the Australian Capital
Territory Ambulance Service when he suffered an injury to his lower
back. Following the injury, the defendant was paid compensation by
Comcare from 27 August 1991 onwards. Comcare is a statutory
authority liable to compensate Commonwealth or other eligible
employees, including those working for the ACT Government, who have
suffered an injury resulting in impairment or an incapacity for
In order to continue receiving compensation, the defendant was
required to provide medical evidence confirming he was still
incapacitated by his back condition. He was also required to notify
Comcare of any income he had received from sources other than
Comcare. This information would then be used to determine the level
of benefits the defendant was entitled to.
In February 2009, the defendant commenced employment as a taxi
driver. On 9 February 2009, he expressly denied to Comcare he was
working in any capacity. An investigation was commissioned in May
2010, during which surveillance was obtained of the defendant
operating a taxi every week for 8 to 10 hours at a time. The
defendant's home was subsequently searched by the Federal
Police and further evidence of his activities as a taxi driver was
From 9 February 2009 to 9 December 2010, the defendant derived
in excess of $120,000.00 in income from his employment as a taxi
driver. During this time, he also continued to receive
approximately $72,000.00 in compensation benefits. This amounted to
the defendant fraudulently receiving some $65,000.00 more than a
person deriving his level of income was entitled to receive.
The defendant argued that he had re-commenced work to fulfil a
desire to "rejoin the community as an active participant in
people-focused employment". However, Acting Chief Justice
Refshauge noted this could have been achieved by the defendant
without acting fraudulently.
His Honour also remarked that the defendant's actions were
not victimless, commenting that fraudulent actions such as these
negatively impact the funding available for essential services in
addition to increasing the taxation burden on honest taxpayers. In
this regard, His Honour noted the requirement for punishment to
"make it clear that defrauding the community... is not
Acting Chief Justice Refshauge acknowledged these offences are
"easy to commit but difficult to detect".3 As
such, custodial sentences ought to be imposed in order to deter
offenders. Ideally, these deterrent measures will avoid the
requirement for more checks on the system which would stand only to
cause delays in the payment of benefits and possibly hardship to
those accessing it.4 His Honour stated it is important
to protect the current integrity of what is essentially an
While the defendant cooperated with authorities and admitted to
his fraudulent actions, it was noted these actions only ceased once
they were discovered. Ultimately, the defendant was sentenced to
two years imprisonment but will be released after serving three
months. He will then be subject to a three year good behaviour
bond. The defendant is also required to make reparation to Comcare
by paying the sum of $64,418.62.
An employee that refused a reasonable offer of settlement was ordered by the FWC to pay his ex-employer's legal costs.
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