A fraud probe is reportedly investigating over 50 sub-contractors hired by the federal government.

Sub-contractors employed by the Department of Human Services for IT work allegedly submitted false invoices and provided fake CVs and qualifications to win contracts, Fairfax reports.

It comes alongside news that the cost of government IT is approaching $10 billion, rivalling the amount spent on Newstart Allowance nationwide.

Lawyer Rory Markham is representing some of the sub-contractors, which he says were inadvertently caught in a complex scam involving “a series of secondary subcontracting companies … at the middle of what has gone on”.

“These companies engaged between 50 to 100 employees as subcontractors for large IT projects at the Department of Human Services,” he told The Canberra Times.

“This process illustrates how increasingly unreliable and murky these secondary subcontracting arrangements can be.”

The AFP is helping with the investigation, which could cover some public service employees as well.

Access passes have been confiscated and workers have been called in to speak with the DHS internal fraud team.

“The Department of Human Services is conducting an internal investigation into allegations of potential fraudulent behaviour involving a small number of former contractors and an APS employee,” a DHS spokesperson told reporters.

“The department is being provided support and assistance by the Australian Federal Police.

“As this investigation is ongoing, it would not be appropriate to provide any further comment at this time.”

Mr Markham said many of the accused had no idea of their alleged role in the breaches.

“Some of the employees involved in the claim now have reason to believe that, without their knowledge, they had CVs submitted on their behalf that were false,” he said.

“These are mums and dads with mortgages to pay and kids to feed. And they are not getting paid while these claims are investigated.”

Investigators have outlined the allegedly criminal nature of the misconduct to all involved.

“As a result of our investigation, we suspect you may have presented false and or misleading information to the department in circumstances where you were required to tell the truth,” investigators reportedly wrote to employees.

“In certain circumstances this type of conduct amounts to a criminal offence.”

DHS is still considering whether formal legal action will be needed.

“We have reached a view that there are reasonable grounds for believing you may have committed a criminal offence,” employees were told.

“If we maintain this view, the matter may be referred to the Commonwealth Director of Public Prosecutions for consideration of prosecution action.”

For now, attending interviews with investigators is voluntary for the employees accused of misconduct.

“Before any further action is taken, we would like to provide you with the opportunity to respond to the allegation by participating in a formal record of interview,” investigators wrote.

“If you are charged with a criminal offence, then what you say in your interview may be used as evidence.”