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A Senate estimates session heard Monday that at least 5% of the National Disability Insurance Scheme (NDIS) fund was being abused by criminals for their advantage.

Officials told the Senate estimates session that criminals were manipulating the participants and using their money to purchase opulent goods like a $73,000 automobile and a $20,000 holiday, ABC reports.

What's even more unsettling is that the fake providers have hounded participants after forcing them to withdraw funds for drug purchases by criminals. According to NDIS integrity chief John Dardo, at least 5% of the scheme's money is being siphoned.

"I have spoken to, very recently, a participant who would meet the provider at the ATM, the provider would withdraw cash and provide that cash to the participant for her to source illicit substances," he said.

From the AU$42 billion scheme, about $2 billion was reportedly being spent on unapproved purchases, News.co.au reported.

"We had a participant that bought a car, brand new, $73,000. The money was processed overnight," Dardo told senators. "Now fortunately when we were able to approach them they understood they shouldn't and were willing to pay back the money."

Dardo said crime syndicates were manipulating participants by setting up pretending to be support coordinators or fake provider businesses.

Voicing concern about the large number of dishonest users in the system, Dardo said that "the vast majority" of the 650,000 NDIS participants are "trying to do the right thing," which he recognized, while emphasizing the need for stronger legislation.

Dardo claimed the issue was pervasive, saying, "You name it. "It's on the list," when asked if the items included drugs such as heroin.

Bill Shorten, the minister for the NDIS, admitted there were problems inside the program.

"I agree that there are issues in terms of fraud in the scheme, but these issues of fraud did not start yesterday," Shorten told the parliament on Tuesday. "The reality is that Labor initiated this scheme and then the Liberals came into power and there's no doubt that they increased the size of the scheme. ... But the problem with what they did is I would have to mark their stewardship of the scheme as incompetent and naive."

"The one difference between us and those people opposite is we are doing something about fixing up the scheme, you did nothing," Shorten said about the Coalition. "We are getting on with fixing up the fraud."