Fraud Offences – Laws, Penalties & Defences in Australia

Centrelink or welfare fraud is a serious offence under Australian law. It involves intentionally providing false or misleading information, failing to report changes in circumstances, or deliberately claiming payments you’re not entitled to from government agencies like Centrelink.

The Australian Government and the Commonwealth Director of Public Prosecutions (CDPP) prosecute welfare fraud vigorously, and penalties can include criminal convictions, fines, repayment orders, and imprisonment.

This page explains what constitutes Centrelink fraud, how charges are laid, what happens in court, legal defences, and how these offences are prosecuted under Commonwealth law and state systems.

What Is Centrelink or Welfare Fraud?

Welfare fraud occurs when a person:

• Intentionally provides false information to obtain a benefit

• Fails to update Centrelink about changes in income, assets, or relationship status

• Uses a false identity or multiple identities to claim payments

• Continues receiving benefits when no longer eligible

• Helps another person commit welfare fraud

To convict, the prosecution must prove that you:

1. Knowingly engaged in dishonest conduct

2. Obtained a benefit you weren’t entitled to

3. Intended to deceive Services Australia (Centrelink)

How Are Centrelink Fraud Charges Laid?

Investigations often begin with:

• Internal audits by Centrelink

• Data matching with the ATO, employers, banks, or super funds

• Anonymous tip-offs

• Cross-checks during jobseeker or age pension reviews

If fraud is suspected, Centrelink may:

• Request information or interviews

• Refer the case to Services Australia’s Fraud Investigation Unit

• Escalate to the Commonwealth Director of Public Prosecutions (CDPP)

You may receive:

• A notice of overpayment

• A civil debt recovery letter

• A criminal charge (typically under Commonwealth law)

Court Process for Centrelink Fraud Offences

Most welfare fraud matters are prosecuted under Commonwealth legislation in the Magistrates’ Court (for lower-value matters) or District/County Court (for serious, high-value or repeat cases).

The process includes:

1. First appearance – You enter a plea

2. Disclosure of evidence – Documents, forms, interviews

3. Negotiations or hearing – Possible plea deals

4. Sentencing – Based on value, intent, criminal history, and repayment efforts

Available Defences to Centrelink Fraud

Legal defences include:

• No intent to defraud – You misunderstood your reporting obligations

• Centrelink error – You relied on advice or incorrect Centrelink calculations

• Lack of knowledge – You were unaware of changes in entitlements

• Mental health conditions – Impairing understanding or decision-making

• Voluntary repayment – May be used in mitigation, but not a full defence

Early legal advice is crucial—many cases can be resolved without conviction, especially for first-time or low-value offences.

Penalties for Welfare Fraud in Australia

Commonwealth Law (Applies Nationwide)

• Legislation: Criminal Code Act 1995 (Cth)

  • Section 134.2 – Obtain financial advantage by deception

  • Section 135.2 – General dishonesty (causing loss or gaining benefit)

• Penalty:

  • Up to 10 years’ imprisonment

  • Court may order repayment, community service, or good behaviour bonds for lesser offences

Other laws that may apply:

• Social Security (Administration) Act 1999 (Cth) – debt recovery

• Proceeds of Crime Act 2002 (Cth) – for seizing unlawful gains

Examples of Welfare Fraud

• Claiming a single parent payment while living with a partner

• Under-reporting employment income while receiving JobSeeker

• Using fake payslips to qualify for youth allowance

• Receiving Centrelink while living overseas without disclosure

State & Territory Court Jurisdiction for Commonwealth Centrelink Fraud

Although the offence is under federal law, it is prosecuted in state courts, which apply local criminal procedure.