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Social Security Act 2018

Administration - Payment of benefits, tax on benefits, debts and deductions - Debts and deductions

354: Recovery of penalty from beneficiary who obtains by fraud amount in excess of entitlement

You could also call this:

“MSD can make you pay back extra money if you lie to get benefits you shouldn't have”

If you receive more money from the government than you should have, and the Ministry of Social Development (MSD) thinks you got this extra money by being dishonest, they can make you pay it back. This is called fraud.

MSD can make you pay back up to three times the amount of extra money you got. They can decide to do this for your specific case or for a group of similar cases.

Even if MSD makes you pay this penalty, you might still get in trouble for the fraud in other ways.

MSD will consider it fraud if you lie or mislead them on purpose to get money, credit, or an advance that you shouldn’t have received. This includes saying something that isn’t true, doing something to trick MSD, or not telling MSD something important when you’re applying for help.

If you do any of these things and end up getting money, credit, or an advance because of it, MSD will see this as fraud.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM6783848.

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353: Debts and deductions, or

“How the government can get back money you shouldn't have received or need to pay”

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355: Restriction on imposing penalty under section 354: prosecution for offence, or

“MSD can't make you pay extra if you've already been in trouble with the law for the same thing”

Part 6 Administration
Payment of benefits, tax on benefits, debts and deductions: Debts and deductions

354Recovery of penalty from beneficiary who obtains by fraud amount in excess of entitlement

  1. This section applies to a person if—

  2. the person obtained a payment, or received a credit or an advance, in excess of the amount to which the person was entitled; and
    1. in MSD’s opinion, that payment, credit, or advance in excess, was obtained by fraud.

      1. MSD may recover from the person, by way of penalty that is a debt due to the Crown, an amount not exceeding 3 times the amount in excess.

      2. MSD’s discretion may be exercised in respect of a particular case, or in respect of a particular class, or any particular classes, of case.

      3. This section does not relieve the person from any other liability in respect of any fraud committed by the person.

      4. A person must be taken for the purposes of this section to have obtained a payment, credit, or advance by fraud if the person—

      5. has made a statement knowing it to be false in a material particular, or has knowingly said or done anything or omitted to do or say anything for the purpose of misleading MSD in the administration of this Act, for the purpose of obtaining a payment, credit, or advance, under this Act; and
        1. has, as a result of that statement, action, or omission, received that payment, credit, or advance.

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