Day care subsidy fraud couple who scammed taxpayers out of $90,000 avoid jail

A migrant couple who ran an elaborate childcare subsidy fraud syndicate staged photographs of kids supposedly in their care to claim government benefits. 

The syndicate set up suburban homes as bogus day care centres, furnished to look like classrooms with items from Officeworks, Kmart and Toys R Us.

They decorated walls by hanging craft works purportedly made by children to fool government inspectors and even held a fake graduation ceremony for students. 

Alee Farmann and Lubna Hashimy – both refugees from Iraq – were spared jail last week despite admitting scamming taxpayers out of almost $90,000 and not a cent of that sum being recovered.

The pair apologised to their adopted country for their well-organised crimes in letters tendered to Sydney’s Downing Centre District Court.

Farmann, 53, was sentenced to 33 months’ imprisonment on June 21 but immediately allowed to walk free after entering a $5,000 recognisance release order. 

Judge Jane Culver also sentenced 44-year-old Hashimy to three years’ imprisonment but immediately released her on a similar order.  

The couple had used Red Roses Family Day Care Pty Ltd to defraud the government’s child care subsidy scheme of $89,938.05 from February 2018 to May 2019.

Farmann was recorded telling an unidentified person he could watch his staff from two large screens in his office which were linked to 12 CCTV cameras. 

The full extent of the loss suffered by taxpayers a result of all Red Roses’s faked reports of child care sessions was never uncovered. 

Red Roses had an office at Fairfield and managed child care services provided by ‘educators’ in private homes across the city’s south-west and in Wollongong.

No such services were provided but children were sometimes taken to the educators’ addresses and photographed to legitimise business records.

Lubna Hashimy (pictured), who fled to Australia in 2006 on a partner visa, said in a letter of apology to the NSW District Court: ‘I apologise to the Australian people. This is a shameful event in my life that will stain my heart’

Hashimy instructed staff on how to fill out timesheets and subsidy submissions to the Department of Education, as well as signing off on fraudulent claims for child care.

Farmann, who drove a Range Rover and purchased a $1.5million townhouse in 2018, showed educators how to prevent the fraud being exposed during particular periods of intensified government scrutiny.

The frauds were committed with the complicity of some Red Roses staff members, educators and parents. Some educators paid cash to the parents whose children they falsely claimed were in their care.

A statement of facts tendered to the court revealed the lengths Farmann and Hashimy went to avoid detection of their rort. 

NSW Police formed Strike Force Mercury in July 2018 to investigate organised fraud committed upon government welfare and insurance schemes.

As part of that operation investigators undertook covert surveillance of Red Roses premises including monitoring the activities of 15 educators. 

Farmann and Hashimy set up suburban homes as bogus day care centres, furnished to look like classrooms with items from Officeworks, Kmart and Toys R Us. One of their fake day care centres is pictured 

Under the relevant legislation, an educator can care for up to seven children at one time, including four children below school age. 

Surveillance established Red Roses submitted false claims that an educator had cared for children on 166 dates at a Fairfield home between October 2018 and May 2019. 

The educator claimed he generally looked after seven children at once, when no care was provided for children at that residence at any  time. 

When Red Roses undertook monthly inspections of each educator’s premises children would be brought to the address and photographed.

At three educators’ premises, Red Roses employees dressed up the location, including by designing crafts which were hung on the walls and attributed to children.

At least one employee undertook ‘inspections’ at a local library or in the Red Roses offices instead of visiting the homes of the educators. 

At a ‘graduation’ ceremony held in December 2018 (above), children were paraded across a stage at Bill Lovelee Youth Centre in Chester Hill and Farmann shook hands with ‘educators’

On one occasion Farmann ordered items from Officeworks and instructed a staff member to ensure a location appeared legitimate by telling her to ‘make it look like a classroom’.

Other items bought from Kmart and Toys R Us to maintain the illusion were never used by children.  

A Red Roses report dated May 26, 2018 noted seven children present at a Fairy Meadow home between 9am and 7pm and included a photograph of them all in school uniform despite it being a Saturday.  

At a ‘graduation’ ceremony held in December 2018, children were paraded across a stage at Bill Lovelee Youth Centre in Chester Hill and Farmann shook hands with educators. 

Farmann pleaded guilty to aiding, abetting, counselling or procuring Red Roses to dishonestly cause a loss to the Commonwealth, knowing or believing the loss would occur. Hashimy pleaded guilty to two counts of the same charge.

He faced a maximum penalty of ten years’ imprisonment while she could have been jailed for 15 years.  

Farmann was recorded telling an unidentified person he could watch his staff from two large screens in his office which were linked to 12 CCTV cameras. He is pictured outside court

Farmann fled to Australia in 1999 by boat following deteriorating conditions for Iraqi expats in Iran after the Gulf War.

He apologised to Australia for his crimes in a letter to the court. ‘I’ve let the principles of my country down,’ Farmann wrote.

Ms Hashimy left Iraq due to her mother being of Iranian background, moving to Sydney in 2006 on a partner visa.

‘I apologise to the Australian people,’ she wrote in her own letter to the judge. ‘This is a shameful event in my life that will stain my heart.’

Judge Culver acknowledged full time custody for Hashimy and Farmann would be difficult on their mental and physical health. 

She also acknowledged imprisonment would challenge caretaking of their children.

Farmann, who purchased a $1.5million townhouse (above) in 2018, showed educators how to prevent the fraud being exposed during particular periods of intensified government scrutiny 

The couple’s daughter, 23, wrote a letter to the court, outlining the impact media reports of the court proceedings had on her two younger siblings.

‘We began to feel racially attacked,’ the daughter wrote.

‘As for my younger brother, boys from his school began to recognise his name … and to harass him about it.’

Judge Culver agreed imprisonment was the only appropriate sentence, but it did not necessarily have to be conducted in full custody.

Imprisonment within the community would be more suitable for the offences, she said. 

The couple will be required to maintain good behaviour for three years under community corrections supervision.