The Asset Forfeiture Unit (AFU) should widen its probe into fraudulent transactions involving the Unemployment Insurance Fund (UIF)’s Covid-19 Ters benefit.
This follows revelations that R5.7 million in UIF funds, intended for 200 workers impacted by the Covid-19 national lockdown, was paid to a single person.
The money was then rapidly disbursed to friends and business associates of the recipient over the course of five days.
The AFU and the UIF are now investigating the matter, and 28 bank accounts have been frozen in connection with the fraudulent transaction.
However, this R6 million fraud is probably only the tip of the iceberg.
Since the introduction of the Ters benefit at the beginning of the national lockdown, hundreds of employers have reported that their Ters benefits were paid into the wrong bank account. Many were informed by the UIF that their benefits had been paid, only to find that the benefits never arrived in the employer’s designated bank account.
Minister of Employment and Labour, Thulas Nxesi, indicated this past week that the UIF has appointed auditors to follow the money trail and track whether Ters benefits were being distributed fairly to employees.
But the Minister is too quick to point the finger of blame at employers, accusing companies of only paying part of the money to employees and not the full amount, as well as companies using the money for something else other than the intended purpose.
However, it is inconceivable that the R6 million fraud and money laundering in question could have occurred without either the active or tacit participation of UIF officials who control processing and payment of the Ters benefits.
The AFU, together with specialist forensic auditors from the South African Revenue Service, needs to widen the scope of the probe into fraud at the UIF associated with the Ters benefit.
They may find that they have only skimmed the surface of a racket that has been going on for three months.