Suspected fraud unearthed

Housing and Public Works Minister Bruce Flegg will ask the Auditor-General to review the Queensland Government’s salary sacrificing arrangements following the discovery of suspected fraudulent activity.

The alleged fraud came to light in June 2011 during the term of the former Bligh Labor Government.

Dr Flegg said Remuneration Services (RemServ), one of two providers of salary packaging services to government, had engaged accounting firm (BDO) to investigate the matter.

“The investigation by BDO reported that the alleged fraud was due to a failure in RemServ’s internal controls,” Dr Flegg said.

“I am informed that the alleged fraudulent transactions impacted the accounts of 7580 current or former Queensland Government employees and totalled $492,763.

“The alleged fraudulent transactions have been traced to a former RemServ employee and the matter is now with the Queensland Police Service and the Director of Public Prosecutions for appropriate action.

“Further discussions will be held with RemServ on how to locate both the current and former Government employees affected and how to return the money that is rightfully theirs.”

Dr Flegg said it was timely to review arrangements following this incident of dishonesty.

“I want the Auditor-General to audit the current panel of two service providers to make sure that Government employees who choose to salary sacrifice are getting the best deal and are not put at risk,” he said.

“I will seek advice on the benefits of reopening expressions of interests for providers of salary packaging services to Government.”

[ENDS] 6 July, 2012

Media Contact: Graeme Hallett – 0408 763 671