INVESTIGATIONS have been launched into statewide social security fraud by the illegal sex trade. Details of more than 700 illegal operations have been demanded from the Adult Business Association of NSW (ABA), which represents the licensed brothel industry.

ABA spokesman Chris Seage said Centrelink's fraud investigation team, based at Lake Macquarie, had been given a list of 775 illegal brothels, massage parlours and home prostitution businesses.

Mr Seage said private investigators had compiled the list from adult advertising in metropolitan and suburban newspapers.

The list shows there are 628 illegal operations in Sydney, 42 in the Hunter Valley, 34 on the Central Coast and 16 in Wollongong with the remaining 55 spread around the rest of the state.

Names and addresses of the owners or managers of brothels and of individuals have been handed over. "It is good to see federal authorities are interested in pursuing the shonks that make up the illegal brothel trade in NSW," Mr Seage said.

"The Tax Office has also been provided with the list." He said the Tax Office had concentrated its audit efforts on the "already (in the main) tax compliant legal industry while an enormous illegal trade has been allowed to go unchecked and untaxed".