Up to 40 people arrested for facilitiating an alleged $4 million family day-care fraud syndicate ran a criminal operation more disciplined than that of an outlaw motorcycle gang, investigators said on Thursday.

"Every part of it from the bottom to the top was a falsehood," said Acting Assistant Commissioner of State Crime Command Stuart Smith.

"There is no childcare happening in relation to this syndicated fraud."

Acting Assistant Commissioner Smith said the childcare scheme was "just a commodity" to the syndicate, the structure of which was "more disciplined than ... outlaw motorcycle gangs."