New Zealand’s Covid-19 wage subsidy scheme was a lifeline for businesses and workers during the pandemic, but it has also become the focus of one of the country’s largest fraud crackdowns in recent history. As the Ministry of Social Development (MSD) and Serious Fraud Office (SFO) ramp up investigations and prosecutions, dozens of individuals have been sentenced or are before the courts for defrauding the scheme, with millions of dollars in public money at stake.

The Wage Subsidy Scheme: High-Trust, High Stakes

When New Zealand first went into lockdown in March 2020, the Government rolled out the wage subsidy as a “high-trust” scheme, aiming to get money to businesses fast to prevent mass layoffs and business closures. In total, about $18.8 billion was paid out to support over 1.8 million jobs, covering nearly half of all jobs in the country at its peak.

Employers were required to declare they met eligibility criteria and undertook to pass on the subsidy to their employees. The vast majority of businesses did the right thing, but the speed and scale of the scheme created opportunities for fraud. Some applicants provided false or misleading information, invented companies or employees, or failed to pass on payments to staff.

The Scale of Fraud: Numbers and Notorious Cases

As of March 2025, more than $829 million in wage subsidies has been repaid, and over 25,000 payments have been voluntarily returned after businesses reviewed their eligibility. However, a significant number of cases have involved deliberate fraud, with 7,800 allegations of misuse resolved and 53 people actively before the courts.

Major Prosecutions

Hun Min Im Case:
In May 2025, Auckland man Hun Min Im was found guilty of a “deliberate and wide-reaching” fraud involving 91 charges. Im attempted to claim $2.3 million from four Covid-era support schemes, including $1.88 million from the wage subsidy, and received almost $624,000. He created fake companies, forged documents, and used the personal information of tenants and job applicants to fabricate employees and directors. The money funded a luxury lifestyle, including an apartment and high-end vehicle. Im was convicted on multiple counts of obtaining by deception and using forged documents.
Jesse Robert Black:
In April 2025, Black was sentenced to 12 months’ home detention after pleading guilty to dishonestly using documents to make wage subsidy applications totalling $28,118. He attempted to obtain a further $104,729 using fictitious or unauthorised personal details, with funds paid into his own and a family member’s bank accounts.
Hares Milad (Ahmad Zafar):
In May 2025, Milad was sentenced to eight months’ home detention for using two business names to make 18 fraudulent wage subsidy applications, receiving $29,480 and attempting to claim another $154,363. Neither company was operational or had employees at the time. The funds were spent on personal expenses, including gambling and retail purchases.
Other Cases:
A husband and wife running a concreting business illegally claimed nearly $100,000 in wage subsidy payments and failed to appear in court for sentencing. Another man received the longest sentence so far-two years and three months-for using 25 fake identities to claim over $25,000.

The Legal Response: Sentences and Recoveries

So far, 36 people have been sentenced for wage subsidy fraud, with penalties ranging from home detention to prison terms. Five individuals have received prison sentences, and seven have been sentenced to home detention. Civil recovery action is underway against 52 businesses, and the SFO is managing five major cases of complex fraud.

MSD has 50 full-time staff dedicated to wage subsidy fraud investigations, and 900 cases are still under active investigation. The ministry works closely with Inland Revenue to verify business and income information, and applicants are contacted to check eligibility before formal action is taken.

How the Fraud Was Carried Out

Fraudsters used a variety of methods to exploit the wage subsidy scheme:

Fake Companies: Incorporating shell companies or resurrecting dormant ones to make fraudulent claims.
Invented Staff: Claiming subsidies for employees who did not exist or using personal details without consent.
Forged Documents: Submitting forged signatures, false GST returns, and fake employment records.
Multiple Applications: Applying under different business names or for multiple support schemes simultaneously.
Misuse of Funds: Spending the money on personal expenses rather than passing it on to employees.

Government and Public Response

The Government has emphasised the need to protect the integrity of the scheme and ensure taxpayer money is used appropriately. Finance and Social Development Ministers have reiterated that deliberate fraud will be prosecuted and that businesses who mistakenly claimed the subsidy are encouraged to come forward and repay any overpayments.

MSD has also implemented a robust audit and assurance programme, including random and targeted audits, civil recovery, and criminal prosecutions. The transparency of the scheme, with an online tool for the public to check payments, has helped identify and deter fraud.

Impact on Businesses and the Community

While the majority of businesses accessed the wage subsidy in good faith, high-profile fraud cases have damaged public trust and put pressure on the Government to tighten oversight. Some of New Zealand’s largest companies, including The Warehouse, Silver Fern Farms, and Sky City, have voluntarily repaid millions in subsidies after reassessing their eligibility.

For those found guilty of fraud, the consequences are severe: criminal records, home detention or imprisonment, and orders to repay the stolen funds. The legal process also serves as a warning to others that abuse of emergency support schemes will not be tolerated.

Ongoing Investigations and Future Outlook

With 53 people still before the courts and hundreds of cases under investigation, the crackdown on Covid-19 wage subsidy fraud is far from over. The Ministry of Social Development, Serious Fraud Office, and Inland Revenue continue to work together to identify, investigate, and prosecute offenders.

The experience has led to calls for more rigorous checks in future emergency support schemes, balancing the need for rapid assistance with the risk of misuse. The Government has signalled that lessons learned from the wage subsidy will inform the design of any future crisis support.

Summary

The Covid-19 wage subsidy fraud crackdown in New Zealand has exposed both the strengths and vulnerabilities of high-trust emergency support schemes. While most businesses did the right thing, a determined minority exploited the system for personal gain, resulting in millions of dollars lost to fraud. With dozens of prosecutions, ongoing investigations, and a strengthened audit regime, authorities are sending a clear message: wage subsidy fraud will be detected, prosecuted, and punished. The legacy of the scheme will be shaped not only by the support it provided in a time of crisis, but also by the integrity and vigilance with which it is defended.