NDIS Fraud : Waverley Social Enterprises Investigation

Nikolai Evanos
7 min readFeb 20, 2024

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This is Part 2 of the story published on 25th January 2024 titled “NDIS Fraud : When the ones you trust are the ones rorting the system”.

A significant amount of information was received through the whistleblower account from interested parties as requested in our previous publication. What is encouraging is the fact that the information was mostly genuine grievances rather than general whinging.

Waverley participants at work

An Update

Since our previous publication, it has come to our attention that the executive responsible for participants at Waverley, the Chief Experience Officer, has resigned from the role. This role is responsible for setting out how much participants are charged. We understand that less than a week’s notice was given, and not the typical four weeks plus expected of executives.

Was this resignation conscience driven? Did the incumbent disagree with the rest of the executives about the way participants were being overcharged?

We have also been advised that a manager in the same team has resigned.

We also highlight the fact that a second executive responsible for billing NDIS participants, the Chief Operations Officer, employed their spouse to manage the invoicing of participants, receiving payments and reconciliations, and reporting to the spouse. This creates a significant conflict of interest, and a major risk to the $6 million NDIS funding that Waverley is entrusted with.

Part Two

We received information from related parties in regard to the potential fraud, general governance issues and a culture of “fear and mistrust”. One even quoted the famous “either you are with us, or with the terrorists”, in regard to the culture.

Another related party titled their email “A cry for help”, relating to the significant concerns that they have about their job, and how they are managed, at Waverley.

We will only focus on the information relating to the potential fraud in this publication, then address the other matters separately.

Public Information

According to the ACNC, Waverley had 390 employees in 2023, and 375 in 2022. The full time equivalent was 288 and 275 respectively, which represents an average 70% full time equivalent.

The NDIS funding claimed by Waverley in in 2022 was $4.1 million, and this increased by almost 50% to over $6 million in 2023.

The organisation only had an increase in employees (assuming participants) of 15. The government applied a CPI related increase of around 8%.

One therefore wonders how Waverley was entitled to an additional $2 million for the year 2023, when their team did not significantly change.

Does the additional $2 million charged to participants, with no additional cost attached to it, explain the “profit” of $1.4 million that Waverley recorded for 2023.

If indeed there was no cost attached to this additional $2 million, does this support the idea that the participants were overcharged for services not provided.

The executives’ renumeration increased from $588,000 in 2022 to $856,000 in 2023, an increase of 45%.

Was the renumeration increase for executives therefore justifiable by the “profit” that Waverley was making? Did this give executives motivation to increase “profits” to justify further increases? Could this have resulted in overcharging the NDIS, especially since the “commercial operation” is not profitable?

Private Information

We endeavour to not publish sensitive information.

According to the information available, there are 29 employees who have a support role to participants as defined by the NDIS Guide.

·- 8 x Support Officers — 100% of the role is to support participants, therefore hours charged 100% to relevant participants

·- 10 x Production Supervisors — spend a significant amount of their time working directly with participants. However, their key role on the position description is defined as “ensuring that the production budgets are met by utilising the principles of Lean Manufacturing and 5S”. This suggests that there is an administration component to the supervisors, which may not be claimable under the NDIS rules.

·- 4 x Managers — despite working directly with participants, the majority of their time is spent on administrative work, and therefore only a small portion of their time should be claimable under the NDIS rules.

·- 5 x Ground Maintenance Supervisors — 100% direct support for participants, each supervisor manages a team of 3 or 4 participants offsite.

The NDIS Guide clearly states that “time spent on administration, …, should not be claimed from a participant’s budget as a Non-Face-to-Face support

Based on the above 29 employees, even assuming they were all 100% claimable (which they shouldn’t) and working full time, the total support hours claimable would be 1,102 hours, equivalent to $69,000 per week [29 employees x 38 hours x 62.17 (NDIS Rate) = $69,000].

This would equate to $3.3 million per year (48 weeks as per service agreement).

One then wonders why Waverley is claiming $6 million per year.

The information that was provided to us in regards to how Waverley justifies charging the additional funding to participants, almost double what they seem to be entitled to based on the NDIS rules, was fascinating.

Apparently, Waverley uses employees with a disability (participants) as part of their support employees in calculating what they charge participants’ NDIS plan, i.e.

·- a more capable participant with a disability in a group is given a “team leader” title.

·- the participant performs limited supervisory tasks like checking output quality as directed by the Production Supervisor.

·- the participant’s total hours are charged 100% to other participants as support hour.

·- the participant is not compensated at a rate similar to a non-disabled supervisor or support worker.

It cannot be expected that the participant with a disability provides direct individual support to other participants, at the level that the NDIS intended, nor at the same level as non-disabled support worker.

What’s most disappointing about this situation is that the participant with a disability, whose hours of work are being charged to other participants as support hours, is also at the same time being charged by Waverley for support hours at the same rate as other participants. To clarify, the “team leader” participant’s NDIS plan is charged at similar rates as other participants.

If indeed it is moral to charge the participant “team leader” hours as support hours to other participants, it can validly be argued that Waverley should not be charging 100% of the hours, because the organisation doesn’t treat the participants as the same level as non-disabled employees, e.g. pay rates.

And if Waverley should charge 100% of the participant “team leader” hours to other participants, the participant is no longer a “supported employee” as they are the ones providing the support to participants. Therefore they must not be charged anything from their NDIS plan.

The role of Waverley’s Board of Directors

The information provided to us show that the directors have a meeting every month. Financial statements must be a standing item on the agenda for these meetings.

ASIC requires that directors read, understand and enquire into the form and content of the financial statements to ensure that the financial information presented is clear and complete. This responsibility cannot be delegated.

One therefore expects that NDIS funding, being a significant part of the organisation’s revenue, would regularly be reported and discussed. Especially when it seems that Waverley’s “profitability” comes from the NDIS funding.

The directors must, or ought to have been aware of the additional $2 million in NDIS funding between 2022 and 2023. Did they ask questions in regard to why Waverley would be entitled to such a significant amount of additional funding, despite not changing the number of employees or participants.

The employee/participants numbers increased by 4%, yet the NDIS funding charged to participants increased by almost 50%.

If the directors were aware of this additional NDIS funding being charged to participants, without supporting additional costs, and despite the fact that the organisation did not have enough support workers to justify the charges, then they might have been complacent in the potential fraud. If a fraud did occur, what are the directors’ responsibilities?

We have been provided with information that when we published the last story, instead of investigating the potential fraud issue raised, some of the directors spent a significant amount of time investigating who might have provided us with information. Unfounded accusations were levelled on employees/participants.

Rather than fix the real issue that is resulting in vulnerable people with disabilities being disadvantaged, the directors were focusing on self-preservation.

Effecting Change

I am conscious of the fact that I only have a small voice. It’s not easy to effect change.

My conscience was triggered by the situation of a certain Mr X (anonymity required). We had several discussions about his situation. Although he functions reasonably well, he still has a disability. In his mind, he doesn’t believe he can effect change at Waverley, hence the need for anonymity. I put myself in his shoes. I can understand his fears.

I am advised that large organisations like L’Oreal, Dulux, Asaleo Care, City of Dandenong, Mattel, etc support Waverley’s work, with L’Oreal being the biggest customer.

This support is invaluable to the participants at Waverley, it gives them a purpose.

If indeed the participants are being defrauded of their NDIS funding, then the value of the support from these and other organisations is being diminished.

To be crystal clear, I would never advocate for the reduction of the support from these organisations to these well deserving participants.

The only consideration that I am asking for is that these organisations ask or require Waverley to fairly treat and charge these participants for services provided only. Your voices are louder than mine. You are more likely going to effect change.

I am working on a Part 3

Part 3 will most likely cover the governance issues and the culture of fear and mistrust.

I still welcome confidential information on WhistleblowKev@proton.me.

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