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The NDIS is being exploited by traditional crime gangs, professional fraud syndicates and scheme-hopping networks, the agency said — and in some cases, allied health professionals are helping them do it.

Organised crime gangs have infiltrated Australia’s National Disability Insurance Scheme (NDIS), using cash kickbacks, money laundering and threats of physical violence against disabled Australians to plunder public funds, the nation’s peak criminal intelligence agency has warned parliament.

The Australian Criminal Intelligence Commission (ACIC) told the Joint Standing Committee on the NDIS that non-compliance “extends beyond isolated or opportunistic misuse and includes deliberate fraud, sharp practices and organised exploitation consistent with broader SOC methodologies.” The agency noted that the problem is “significant and, in some cases, systemic.”

ACIC’s warning comes as the scheme, which grew more than 10 per cent last year and is on track to cost $63 billion annually by 2028–29, faces its most significant overhaul in years.

The Daily Declaration has previously reported on the NDIS’s unchecked growth and the criminal exploitation that has accompanied it. Cutbacks to the ballooning scheme will be central to the Albanese government’s May budget, according to the Guardian Australia.

Criminal Methods

ACIC’s formal submission to the inquiry identifies three distinct categories of criminal actor now embedded in the NDIS: “traditional organised crime groups, professional fraud syndicates and scheme-hopping networks” — all of which have “established or infiltrated NDIS providers.”

Infiltrated providers use disability funding to generate income, launder illicit proceeds and conceal asset ownership, ACIC explains. And the proceeds do not stay there: “the money fraudulently obtained by SOC [serious and organised crime] through exploitation of the NDIS is also routinely recycled into a range of other serious criminal activity.”

The central enabling method is what the ACIC calls “kickbacks” — cash incentives paid to participants, their nominees or family members. “These arrangements operate along a spectrum ranging from knowing collusion to coercion,” the commission said.

At the coercive end, “intimidation and threats of physical violence have been used to compel compliance, particularly against participants with physical or cognitive impairments.” The ACIC assessed that some participants are likely unaware they are involved in fraudulent activity at all.

Allied health professionals are among those facilitating the exploitation, the agency warned — assisting “unsuitable providers to gain entry to the NDIS, pass audits or inflate participant funding.”

False or exaggerated documentation is also prepared to justify higher funding, allowing fraud to penetrate further into the scheme.

Systemic Failures

The Australian Institute of Criminology, cited in the ACIC submission, estimates that serious and organised crime costs Australia up to $82.3 billion annually — 3.2 per cent of GDP — and the NDIS is now one of its most attractive targets.

ACIC’s submission details a pattern of preventable failures:

Analysis of providers subject to banning, suspension or serious regulatory action shows that a significant proportion exhibited historical risk indicators prior to entering the NDIS, including prior fraud convictions, adverse findings in other government programs, suspicious financial activity and poor engagement with the taxation system. In many cases, these indicators were identifiable before entry to the NDIS.

Moreover, banned providers routinely return:

ACIC intelligence identifies repeat and cross-program offending, where individuals and networks previously subject to compliance or enforcement action in other Commonwealth programs subsequently re-emerge in the NDIS.

According to ACIC, gaps in data-sharing across Commonwealth programs is in part to blame for letting repeat offenders slip through.

Unregistered providers add a further layer of risk. Unlike their registered counterparts, unregistered providers can lawfully deliver services to self-managed and plan-managed participants “while operating outside many of the suitability, registration and ongoing compliance requirements” that govern the rest of the sector.

ACIC said unregistered providers “may pose a real but not yet fully understood fraud risk,” with higher-risk actors routinely using them to reduce scrutiny while maintaining access to NDIS funding.

The Joint Standing Committee’s inquiry, referred on 25 March 2026, is receiving submissions until 24 April. Its report is due 2 July.

ACIC said continued inter-agency collaboration through the Fraud Fusion Taskforce — a 23-agency body it hosts — would be essential to protecting participants and reducing criminal involvement in the scheme.

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Image courtesy of Wikimedia Commons.