Three suspects in Mpumalanga have been arrested on fraud charges linked to the Unemployment Insurance Fund’s Temporary Employee Relief Scheme (TERS).
The Special Investigating Unit (SIU) says the suspects allegedly siphoned nearly R27 million through claims involving ghost workers. SIU spokesperson Selby Makgotho confirmed that the arrests stem from referrals made by the SIU pursuant to Proclamation R. of 2020.
Speaking about the case, Makgotho explained that at the height of the COVID-19 pandemic, large-scale irregularities and looting targeted the TERS, resulting in significant financial losses to the fund estimated in the millions of rand. Following investigations that uncovered these irregularities, the SIU made referrals that contributed to the current outcome.
“This outcome further strengthens and underpins the significance of the collaboration that we have with other law enforcement agencies, the Hawks, the NPA,” Makgotho said, noting that it has led to preservation orders, successful convictions in related matters, and steps toward recovering the funds.
The SIU spokesperson detailed the modus operandi used by the suspects, describing it as a scheme manufactured by a couple in Mpumalanga who enlisted the services of their brother-in-law as a runner. They allegedly created fictitious, non-existent accounts using ID documents and personal information from individuals in Mpumalanga and North West provinces. These claims were submitted to the UIF, which Makgotho noted lacked proper due diligence at the time.
“The money was supposed to assist the most distressed people at the time of COVID, those who had lost their jobs,” he added. “Unfortunately, some people came up with these schemes to the detriment of the genuine beneficiaries.”
A preservation order has been obtained for assets linked to the approximately R27 million that was siphoned. Makgotho said the order aims to ensure recovery of the looted funds. Investigations revealed that some of the money was spent on pricey properties in gated communities and expensive vehicles.
The preservation order will allow authorities to enforce recovery through the High Court, with potential forfeiture of assets to the state to be determined in due course. The SIU has emphasised that similar modus operandi involving fictitious documentation has been identified in other UIF-related investigations.