Alana Buckley-Carr | June 28, 2008
ONE of Australia's best-known Islamic schools has been accused of defrauding the commonwealth and West Australian governments of more than $3million by claiming it had hundreds more students on its books than it did.
Australian Islamic College director Abdallah Magar, 69, and school principals Mark Debowski, 50, and Aziz Magdi, 53, are due to appear in a Perth court on Wednesday over charges that they obtained a financial advantage by deception for another person and gained a benefit by fraud.
They were released on $100,000 bail yesterday. Police are expected to ask the men to forfeit their passports.
After being released from custody yesterday, Mr Magar said he would defend the charges.
The men are accused of inflating their student numbers by claiming money for students who were not attending the school.
Police said the school could claim $1300 to $2000 for each child from the West Australian Government, while the funding rate under the commonwealth ranged from $4000 to $6000, depending on the child's age.
Inspector Arno Albrecht, of the Major Fraud squad, claimed: "The defrauding of the government agencies was simply putting forward false numbers of students and, as a result of that, they obtained the subsidised funding. There was some checking but nowhere near what you would think would be required for giving out such large amounts of funding."
He said that although some of the funding was used for school purposes, the men were paid high salaries, with Mr Magar earning about $200,000 a year.
Inspector Albrecht said the charges related to funding received in 2005 and 2006 but other funding years had not been investigated because of resourcing and public interest limitations. In total, it was alleged the men fraudulently gained $3.16 million from the state and federal governments.
About $2.5 million of the funds came from the commonwealth, with the balance provided by the West Australian Government.
"They're not claiming the same amount of student subsidies now, so whether they can maintain the operations of those (campuses) based on not receiving those funds is something I couldn't tell you about," Inspector Albrecht said. "(But) we're aware that (their claims) have been dramatically reduced."
He said that although there was a risk the schools could close as a result of the charges, it would be up to the relevant government departments.
The charges were laid 18 months after Major Fraud officers raided the school, seizing 200 boxes of documents, 12 filing cabinets and 15 computers.
State Education Minister Mark McGowan yesterday moved quickly to ensure parents the schools' three campuses would remain open.
"The Department of Education Services is working closely with the college campuses to ensure the needs of students are not affected by the arrest," Mr McGowan said. "The campuses have been inspected in the past and have met the requirements for registration as non-government schools."
A spokeswoman for federal Education Minister Julia Gillard said the department was working with its state counterpart to clarify the management structure of the three schools.
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