Is Centrelink checking your bank account?

Does Centrelink have the power to check your bank account?

Is Centrelink checking your bank account?

Irene asked us to settle an argument on whether Centrelink has the power to check your bank account.

Q. Irene
Could you please settle an argument for me? A couple of my friends say that Centrelink can look at our bank accounts any time it likes. I say it can’t, as it would be a breach of the privacy act. Which of us is correct?

A.  There are many anecdotal stories on whether Centrelink can and does check bank accounts and the upshot is that Centrelink does not have the power to spot check individual's bank accounts. However, it does utilise data-matching with other Government agencies to weed out cases of possible welfare fraud.

For example, if you were to provide Centrelink with one set of figures and information, but the ATO with something different, this would be flagged by data-matching software. Centrelink has the power at this point to request details of your accounts from your bank. This information will be sent in an encrypted form to specialised staff, who will review them.

Centrelink does not have the ability to remove funds from your account; however, it does have several means by which it can recoup overpayments

  • Centrelink will issue an Account Payable letter explaining how much is owed, why it’s owed, when it’s due and how it can be repaid.
  • If you do not make repayments, Centrelink can reduce your income support payment by 15 per cent. If you have additional income, the amount can be more than 15 per cent.
  • Centrelink can also engage the services of a debt collection agency if you do not meet the repayment schedule.
  • It can refer your case to its solicitors for legal action.
  • In extreme cases, it can issue a garnishee on your wages, tax return, income and assets or money held in a bank account. This means an amount is recovered and paid to Centrelink.


Centrelink requires details of your income and assets to determine your eligibility for income support and at which rate it should be paid. You will need to advise Centrelink of the balance of your bank account, investments, assets you hold and any additional income you earn. In order to streamline the assessment process, Centrelink applies a deeming rate to your investments. This means that you do not have to advise every time your bank account balance or investment returns change – it will simply apply a standard percentage to your total investments to determine an average income return.

However, if your circumstances change, for example you receive a lump sum payment, you purchase an asset or your relationship status changes, you will need to advise Centrelink immediately.

Finally, with the increased use of social media, those committing benefit fraud are more likely to be caught. Those in a relationship who claim to be single in order to receive a higher benefit payment, only to post the news of a happy event, such as a wedding or birth of a child on Facebook, could find themselves receiving a visit from Taskforce Integrity

You can find out more about Centrelink’s privacy policy by visiting HumanServices.gov.au

Are you eligible for an Age Pension? Do you know your rights? The PensionChecker™ tool has all the information you need.

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    Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a Centrelink Financial Information Services officer, financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.





    COMMENTS

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    grumpyoldwoman
    14th Jun 2019
    10:47am
    Of course they do! But my main worry with Centrelink is all the errors they make that disrupt innocent people lives and CENTRELINK expect the client to produce "all the paperwork" etc. to fix the problem their systems of operation cause! My 92 year old mother who has been on her pension for years and years just recently had to prove who she was because they got her name mixed up with someone else's and she lost her pension and other benefits until my brother went into the local office with the papers (as her POA) to fix the problem! And that's just one of many stuff ups they have made that I could name. We need an enquiry into Centrelink and a complete overhaul of this system that just is one big headache to everyone. I feel sorry for all those Centrelink workers on the other end of the phone, I bet more than half of them are waiting to find a more rewarding career. That's my rant for the day:)
    Cowboy Jim
    14th Jun 2019
    11:02am
    When I applied for the age pension I signed a piece of paper agreeing to C/L being able
    to check my accounts. Do not really see anything sinister in it. Had no trouble with the agency so far apart from having my card cancelled for being 3 days too long abroad; I did tell them before I left.
    GeorgeM
    14th Jun 2019
    12:07pm
    Just another example, gow, why Centrelink needs to NOT exist in the lives of Retirees especially as they get older.
    It is absolutely the time (with a Retirement Incomes Review to be started soon by the Treasurer) for all Retirees to hammer the politicians to scrap the Broken Age Pension system and implement Universal Age Pension (for all with NO tests, other than Age 65 yrs and Residency say 15 years) which can be easily paid out automatically by computer systems from the ATO at minimal cost compared to the massive Centrelink admin costs.
    Ardnaher
    14th Jun 2019
    2:14pm
    so pleased I have no interaction with them. It sound horrendous...how do elderly people get on with all the paperwork, change of circumstances etc etc.
    johnp
    16th Jun 2019
    3:51pm
    agree with GeorgeM Universal Age Pension as gets rid of most of the centrelink bureaucratic back and forth processes like checking and interviewing people all the time. and govt will still get their tax largesse from the wealthier retirees via the tax system.
    We cant have the pollies missing out can we on all their obscene salaries,travel perks for life etc ??
    Scomo and the other pollies recent large increase in salary was inexplicable, he doesnt have much to spend it on; what with most daily incidentals being paid for, like meal allowances,travel etc etc.
    sunny
    14th Jun 2019
    10:59am
    AGREE, AGREE, AGREE, an enquiry into them would be wonderful to watch on the telly.
    I wont even start to list the fiascoes Iv'e had with them!
    GeorgeM
    14th Jun 2019
    12:11pm
    The proposed Retirement Incomes Review could instead be a Royal Commission into the treatment of Retirees Incomes, with special focus on Centrelink with their Robo-Debt system, massive failures to provide prompt service, Deeming Rates, punishing Assets Test, etc, etc!
    adbob
    14th Jun 2019
    11:04am
    Banks report interest paid to the ATO as a matter of routine.
    ATO shares data with Centrelink.

    If you're getting the interest you must have the capital.
    Sundays
    14th Jun 2019
    11:52am
    Superannuation funds also report to Centrelink both the capital and any pension payment. You can’t hide income. Also transactions over $10,000 must be reported by banks to AUSTRAC who share with Centrelink and others.
    Ardnaher
    14th Jun 2019
    2:16pm
    ...there has to be some sort of check! I am sure many of us know of someone who rorts the system.
    Greg
    15th Jun 2019
    2:23pm
    Sundays - the $10,000 and over transactions are only cash over the counter transactions not say a withdrawal from one account and placed in another account.
    miss marple
    14th Jun 2019
    11:19am
    if your doing the right thing then you shouldn't have to worry about anything
    Tom Tank
    14th Jun 2019
    11:36am
    True you shouldn't have to worry but recent history has shown that Centrelink has made errors. This probably is related to cutbacks made by the Government to Centrelink funding to the point that contractors were hired to ease some of the workload of the Centrelink employees. This apparently hasn't worked out too well as the contractors did have the knowledge to be able to do the job properly. Also since they were not Government employees and subject to the Government's employment conditions on privacy one wonders about them having access to all our personal data.
    Tom Tank
    14th Jun 2019
    11:36am
    True you shouldn't have to worry but recent history has shown that Centrelink has made errors. This probably is related to cutbacks made by the Government to Centrelink funding to the point that contractors were hired to ease some of the workload of the Centrelink employees. This apparently hasn't worked out too well as the contractors did have the knowledge to be able to do the job properly. Also since they were not Government employees and subject to the Government's employment conditions on privacy one wonders about them having access to all our personal data.
    GeorgeM
    14th Jun 2019
    12:13pm
    That's a dumb comment, miss marple, considering the massive failures by Centrelink services including their nasty, one-sided and defective Robo-Debt system implementation which assumed people are guilty until proved innocent.
    Triss
    14th Jun 2019
    12:26pm
    And your comment is very rude and unnecessary, GeorgeM.
    SFR
    14th Jun 2019
    1:30pm
    Agree GeorgeM. Even when people have done the right thing centrlink won't
    GeorgeM
    15th Jun 2019
    4:39pm
    Not at all, Triss, my response was in proportion to the comment which was ignorant and insensitive to the many people wrongly victimised. I explained it as well.
    johnp
    16th Jun 2019
    3:55pm
    About time the pollies did "the right thing" and recognise their obscene salaries and benefits will cause problems down the track as people get more and more pissed off !!
    Oldman Roo
    14th Jun 2019
    11:32am
    I had , what I consider a strange expereience , when I made a withdrawal for the cost of my wife joining some friends on a holiday Interstate a few years ago . I casually mentioned to the Bank Teller young Lady that I make this higher than usual withdrawal to pay for the wife,s holiday . She immediately replied , we have to report this to Centrelink because all overseas trips must be reported to them by us . I could not believe it at the time and said to her , you do not seriously expect someone to go on an overseas trip with the comparatively small amount I am withdrawing for a 7 day holiday Interstate . Obviously she was not the brightest and was nonplussed . So now we know what may go on behind the scenes and we should not know about .
    Also at another time , when I confirmed my Bank balance with Centrelink , I gained the impression they already knew it .
    Maybe not all Banks are providing this info readily to them and it would be interesting to hear from others about a similar experience .
    Greg
    15th Jun 2019
    2:33pm
    Sorry that's just rubbish - the Bank Teller, the most junior member of the branch would not know the facts, she's getting confused with something else.

    Banks DO NOT report transaction between accounts or Bank Cheques issued, the only reported transactions are those that are CASH over the counter - it's reported to AUSTRAC who keeps track of cash transactions for illegal activities like money laundering. The can can also report any suspect transactions like someone coming in everyday depositing $5,000 even though it's under the $10,000 limit it's regular and may be seen as suspect.

    Banks also report overseas electronic transfers of any amount as a matter of course.
    SFR
    14th Jun 2019
    11:54am
    "Centrelink will issue an Account Payable letter explaining how much is owed, why it’s owed, when it’s due and how it can be repaid" I thought centrelink basically didn't need to explain why, just issue a robodebt and demand payment even if the debt wasn't real.
    Theo1943
    14th Jun 2019
    12:08pm
    I got this message in my MyGov postbox today
    Hi,

    The way you get your payment summary information is changing.

    Your end-of-year payment summary information, now called an income statement, will be available through myGov for you or your tax agent.

    It's important to wait until your employer marks your information as tax ready before your tax return is lodged. Most employers have until 31 July to do this, and we'll send a message to your myGov Inbox when it is tax ready.

    If you lodge your tax return before your income statement is tax ready, you may need to lodge an amendment. In some cases, additional tax and interest may be payable.

    If you have more than one job, your other employers may still need to provide you with a payment summary. Make sure all income is included when lodging your tax return.

    This change is because many employers are now required to report pay and super information direct to us each pay day. All employers will eventually report this way.

    Regards,

    Commissioner of Taxation

    This will enable Robodebt to actually get real figures for their calculations
    GeorgeM
    14th Jun 2019
    12:16pm
    That's clearly from ATO, not Centrelink. Robodebt is operated by Centrelink, not ATO.
    Russell
    14th Jun 2019
    12:48pm
    That is from the ATO and not from CentreLink and anybody who is registered with MyGov and linked to the ATO will get that notice. Even a 30 year old brickie who is working full time as long as he is registered with MyGov with the ATO linked account.
    Theo1943
    14th Jun 2019
    12:53pm
    George, Robodebt compared income reported by you to Centrelink with income reported to the ATO by your employer/s. The reason this did not work is because the ATO only had your annual income and Centrelink's Robodebt averaged that over the year as equal fortnightly payments. With the ATO now having your wages reported each pay and providing that information to Robodebt, Robodebt will get close to working.
    GeorgeM
    15th Jun 2019
    4:43pm
    Thanks, Theo, for the clarification, however the letter did not say that or make any such promise for the future.
    Until they get RoboDebt completely right (within say .05% accuracy), the RoboDebt system must be suspended - as the Senate recommended.
    rob101
    14th Jun 2019
    12:38pm
    Centrelink has already said that as part of Robo-Debt recovery that they can and will Gafnishee bank accounts.they havealso taken peoples Tax Returns.and have the power to stop people leaving the country.

    Rob101
    maelcolium
    14th Jun 2019
    12:54pm
    Just to clarify, you need to advise Centrelink within 14 days if your assets vary by $1000 or more.
    grumpyoldwoman
    14th Jun 2019
    1:02pm
    I thought it was $2000 or more?
    sunnyOz
    14th Jun 2019
    3:17pm
    grumpy - is $1000. Which is just ridiculous. A few years ago, I sold my horse float, so had to advise them. Few months later, sold big car. Then bought smaller car, plus also helped pay for my daughters car. Next time I need to do this, I won't bother, it is just so stupidly low. It is nothing to take out $1000 to pay bills. Is just so time wasting for both CL and people.
    Cowboy Jim
    14th Jun 2019
    3:24pm
    In March I paid our health insurance premium for the full year so saving the 5% or so price increase, was $5237. Never reported that as it was clearly marked in the account statement where the money went to. Maybe taking the amount out in cash might be reportable, never took that amount out. My debit card limit is high for purchases but goes only to $1000 per day for cash.
    Cowboy Jim
    14th Jun 2019
    3:29pm
    My paperwork here says $2000! A mate went to see them after getting $2300 on the horses and was told to go away as next week he might turn up to report the loss of $3000 again. They told him they were not interested in gambling wins only recurring incomes and windfalls like big lottery wins etc.
    johnp
    16th Jun 2019
    4:00pm
    agree with sunnyoz. many bills are now over $1000 like council rates, health insure etc
    SuzeB
    14th Jun 2019
    3:01pm
    It's taxpayers' money, for which I'm grateful. I'm quite happy for them to check and see if I really need it.
    in2sunset
    14th Jun 2019
    3:06pm
    I went through the mill with CL after recently selling a caravan and car, and downsizing to a smaller car. Sold both at a huge loss. There was some excess money over, which I needed to build a carport. Advised CL of all changes, but was then appalled when CL said they wanted to see the receipt for carport. I refused, and stood my ground. What I spend my own money on is my business. After saying no, they did not push the matter.
    grumpyoldwoman
    14th Jun 2019
    4:15pm
    Whoops! Never try to "stand your ground" it will probably be noted on your file as "un- co-operative or something similar, you cannot say no to Centrelink or any Government department without repercussions in the future. But good luck anyway! It takes a big army of protesters physically or in words to make a difference in this world these days. If you are just protesting privately.....whoa! Well that's my view and experience, and the experience of others I have heard from....in other words, do as your told! Mum and Dads do their nutters for a half hour and then forgive and forget, big brother doesn't! And who knows who is reading our posts from ANY GOVERNMENT departments and how much information they are collecting! Call me paranoid but at least I am not walking into telephone poles reading my mobile something I saw today and I could not restrain myself from laughing! HA HA HA! sigh ....back to Caring duties! Goodnight all in OZ
    ronnieb
    14th Jun 2019
    4:38pm
    Whether they do or don't is no bother to me but why is everybody so concerned about the official figure above which must be reported to Centrelink if it is a lump sum over $2k ? They simply don't have enough staff to monitor such petty movements. We sold and bought a house and nobody was interested provided we didn't go over the assets or income limits. I have found Centrelink staff to be reasonable, practical, sympathetic and supportive whenever i have spoken to them . Give them a break, there are thousands of people out there trying to rob Centrelink big time and some are very successful at it. But why would you? It's taking from the inside pocket what you have (or might have) put in years ago.
    grumpyoldwoman
    14th Jun 2019
    4:46pm
    Sigh!
    Leanne
    16th Jun 2019
    1:36pm
    I had been overpaid on my careers allowance to the tune of $166.00. Whilst on the phone to Centrelink to make arrangements to pay it back the man on the phone checked my account that the payments are made to and told me there was enough in the account to cover the debt. I was not happy that they can invade my account like that.
    SFR
    16th Jun 2019
    2:08pm
    This is Australia, we have been stripped of any privacy by all governments over the years. Governments can do what they like without question, just like China & other communist countries.
    Paddington
    16th Jun 2019
    4:42pm
    Did you, at some point, tick that they were allowed to do this?
    They may be tricking us into marking off something that covers this.
    McDaddy
    16th Jun 2019
    9:03pm
    THat's BS he can't see a live balance of your account, only what had been previously recorded.
    johnp
    16th Jun 2019
    4:05pm
    dealing with centrelink is like a Catch22 situation !!
    Very "Kafkaesque" !!
    Paddington
    16th Jun 2019
    4:50pm
    Maybe the focus is on the wrong group:
    https://www.smh.com.au/national/australia-takes-from-the-poor-to-give-to-the-rich-20180404-p4z7sn.html
    adbob
    16th Jun 2019
    8:10pm
    That's spot on.

    Round here many farmers and horticulturalists have many many millions stashed away in family trusts. Each individual is a straw man/woman on paper - they spend their lives with healthcare cards etc and at age 65 grab a full age pension even if they are still working.

    Then you read spin in the paper about their not having enough money to put bread on the table.

    Farming's a big money gamble these days. It's all spin.

    Don't expect any sudden change on that - least of all from this current LNP mob (agrarian socialists all) - although plenty of Labor governments have left this well alone.

    All pollies run scared of medics, academics (sic ie university salary-drawers) and farmers.
    Ordinary folk are always fair game for a hit. As long as the next election isn't too close.


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