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Ters fraud: The authorities are closing in

More than R57bn paid out to close to 13.5m employees so far.
The Cobras’ investigations are starting to pay off: 20 people have been arrested and 70 criminal court cases have begun. Image: Supplied

Authorities are rapidly closing in on thousands of South Africans (citizens and officials) who unlawfully enriched themselves through the Unemployment Insurance Fund (UIF) Covid-19 Temporary Employer-Employee Relief Scheme (Ters).

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On August 22 last year Minister of Labour and Employment Thulas Nxesi referred the findings of the office of the Auditor-General regarding fraud and wasteful expenditure associated with Ters payments to the Special Investigations Unit (SIU) – colloquially known as the Cobras – for consequence management and legal action.

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This week, the Cobras reported back to the parliamentary portfolio committee on labour and employment.

Regarding the Ters awareness campaign, the Cobras found that R6.1 million was irregularly spent on radio advertisements. Disciplinary hearings are currently proceeding against seven officials.

Furthermore, lifestyle audits of several UIF officials have started and rapid progress is being made.

Thus far, 13 447 004 employees working for 1 156 565 companies or employers have benefitted from Ters, to the tune of R57 384 148 010.44.

How the fraud has been perpetrated

The Cobras identified a wide variety of ways in which Ters payments have been fraudulently claimed.

These include:

  • UIF officials making payments to their colleagues or themselves;
  • Payments made to the deceased, prisoners, foreigners and people with invalid ID numbers;
  • Double-dipping (beneficiaries claiming Ters payments while also receiving social grants);
  • Payments of amounts that are too high or too low; and
  • Instances where the payment date precedes the claim date.

Since December 12, investigations into payments to 6 140 civil servants, 78 South African National Defence Force members, seven prisoners and 68 deceased people have been finalised; 20 people have been arrested and 70 criminal court cases have started.

Parliamentary response

DA MP Michael Bagraim raised concerns that the Cobras’ mandate on this matter is too narrow.

Bagraim, who is one of the country’s best known labour lawyers, pointed out that he and fellow DA MP Dr Michael Cardo had, from the first week, accurately pointed out practical examples of fraud, maladministration, inefficiency and wrongful expenditure – but that the ANC, the department and Nxesi had done nothing for months, and instead questioned the DA’s credibility.

He said top officials remain suspended on full pay at great cost to the taxpayer, and insisted that the full might of the law be brought to bear on guilty officials, including the director-general of Nxesi’s department.

Bagraim said the pandemic has merely accentuated the weaknesses and fraud that has existed for years, and which the officials and the ANC have ignored and abetted.

Cardo asked that the Cobras also investigate whether the malfeasance was by design.

Freedom Front Plus MP Heloise Denner emphasised that the investigation should also include input from the departments of home affairs and civil service and administration.

The Cobras said their investigation is continuing and they will report back to parliament on their progress regularly.

Listen to Nompu Siziba’s interview with Karam Singh from Corruption Watch (or read the transcript here):

COMMENTS   13

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Perhaps it is time we built a nice big new jail. There are plenty of candidates to fill it up.

It would need to be the size of Zambia

A lot bigger, to accommodate all of the ANC members and their entourage.
Maybe 65% of the size of South Africa.

Yep. Build it in De Aar. A Mega prison.
Where the train lines all meet.

No Air-conditioning.

“20 people have been arrested and 70 criminal court cases have begun”.

If I was one of these criminals I would feel pretty hard done by, there are thousands of cases and only 90 odd have been mentioned.

This is the problem. There is so much fraud and corruption wherever you look, that it is impossible to convict all the culprits . However, it would be very nice to see some of the major culprits get jail time , this would at least send some kind of message . SARS has a role to play in this and instead of focusing on the soft targets , like the average man in the street, it should go after Q7 and Bentley crowd who are obviously living beyond their means. All we hear is that the net is closing in, we never get to hear of a single conviction .

Someone suggested to use old mines as jails. I though it was a good idea since cANCer bragged how they operated underground.

Corruption permeates the South African society. This cannot be solved by an ANC government that shows the way to a theft and corruption nirvana. The only way to stop it is a complete tax and fees boycott. The failed state is already here.

The UIF paid our company too much and they have made it very difficult to pay them back. I wonder how many companies this happened to.

In my opinion the SA taxpayer deserves to know who all these fraudsters are. It was, after all, our hard earned money that was stolen. Name them, and shame them.

Nee wat, forget it. All smoke and mirrors (when is the election?). How many of “our people” do you see in jail for known fraud committed?

Suspend immediately on no pay.
Then prosecute

The government is a lame duck, SA is truly a corrupt state and not just the state but also its citizens who take their lead from those in power. The consequences for crimes are pitiful and encourages a bad code of ethics. SA has become a narcissist country where everyone grabs what they can.
Those voting for this government should hang their head in shame as they are complicit in the corruption by lending their votes.

Ubuntu, my foot!

End of comments.

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