Service NSW pays backlog of 19,500 small business grants as police investigate fraud

Service NSW is working through a backlog of overdue COVID-19 business support payments for small businesses, after it was forced to call in police to investigate ‘anomalies’ in some applications.

The NSW government summoned the police to investigate suspected fraudulent applications for the micro-business grant, which totalled $15.9 million in payments.

In a statement to SmartCompany, Service NSW confirmed it had suspended making payments for the micro-business grants on November 1 while the investigation was underway, but payments to eligible businesses re-commenced on Monday.

A spokesperson from Service NSW said the government was forced to pause the grant payments temporarily while anomalies in some applications were investigated.

“Recurring payments for existing applicants have now resumed with more than 19,500 applications already processed and the majority of payments to be restarted in the coming week,” the spokesperson said.

The $1500 fortnightly micro-business grants were available to small businesses and sole traders that experienced a 30% decline in revenue throughout the most recent lockdowns in NSW.

To be eligible for the grants, businesses needed to reaffirm their eligibility every two weeks to continue receiving the payments.

When Service NSW suspected businesses were lodging fraudulent applications, it formed the Strike Force Sainsbery taskforce with the NSW police to conduct an investigation.

Stuart Smith, assistant commissioner of the State Crime Commander, said the investigation will continue use a state-of-the-art artificial intelligence system to mass analyse metadata linked to the applications.

“We cannot have those in need miss out on crucial support while greedy fraudsters live it up on the dime of NSW taxpayers,” Smith said on Tuesday.

“Let this be a warning to anyone who made a fraudulent application. It will not be long before we are knocking on your door.”

According to Service NSW, suspected fraudulent applications for the micro-business grant equate to 2.6% of all paid applications.

The department confirmed it will ‘prioritise’ paying legitimate grant recipients while the investigation is underway.