Police shut down $15.8m daycare rort

Six people have been charged over an alleged rort of grandparent welfare payments worth $15.8 million.

Two men and four women were arrested on Wednesday for repeatedly making false claims on behalf of family childcare centres they ran and worked at in Melbourne's west.

The claims, dating back to March 2014, mostly related to the grandparent childcare benefit scheme, which covers the full cost of fees for up to 50 hours of care per child per week.

Police have withheld around $1.1 million of assets belonging to those arrested, including two Melbourne properties, bank accounts and a pair of luxury cars believed to be the proceeds of crime.

Some of the alleged fraudsters, aged between 23 and 48, are family members and managed, or provided, day care services.

They have been charged with many offences including conspiracy to dishonestly cause a loss to the Commonwealth.

It follows a joint investigation involving the Australian Federal Police, Department of Human Services, Department of Education and Training, Taskforce Integrity and the Victoria Department of Education and Training.

"$15.8 million is a significant alleged welfare fraud and this is certainly the biggest one we've had in the last 12 months," the AFP's Commander Peter Crozier told reporters in Canberra on Thursday.

The Victoria government said it will not tolerate people in the childcare industry acting inappropriately or failing to comply with regulations.

"We will investigate any claims of illegal childcare services or improper behaviour, take action to shut down offenders and where necessary, bring them before the courts," a spokesperson for the state's Department of Education and Training said in a statement.

Police have not ruled out further arrests as inquiries continue.