The Unemployment Insurance Fund (UIF) has already identified 75 cases of possible corruption with the payment of temporary relief to workers, said Minister of Employment and Labor Thulas Nxesi.
Every cent of the lost money will be tracked, Nxesi said by mouthing his spokesman in response to the incident in which R5.7 million was paid into one worker’s bank account on May 14. It was money meant for 200 workers.
The National Prosecuting Authority’s (NPA) asset seizure unit obtained a court order last week to freeze 28 bank accounts in which part of that amount is still left.
Nxesi was encouraged by the prompt response of law enforcement authorities to intervene in this particular case. He welcomed the work of the UIF’s internal risk, anti-corruption and integrity management unit, which has already identified the 75 other cases of possible fraud.
Internal control and expertise in investigative capacity at the UIF was sharpened with the help of the private sector as well as the auditor general, Nxesi said.
The Department of Labor or the UIF did not answer questions about whether employees of the UIF have been investigated or suspended due to involvement in the fraud.
The UIF will have to report on the disbursement of money during the Covid-19 restriction on Friday before Parliament’s standing committee on public accounts, and will probably then be charged with the fraudulent payments on the coals.
This is how R5.7 million was distributed
Last week, the NPA obtained a seizure order to freeze the Capitec bank accounts of Tshepang Phohole and the bank accounts of a number of his friends, which they apparently initially distributed part of the R5.7m.
According to court documents, on the same day he received the R5.7m in his Capitec account, Phohole had an amount of R1.25m to Taetso Zulu, as well as R1m to Godfrey Mojela, and R2.3m to Tebogo Masoko’s FNB account paid. On May 17, Phohole used R5 000 of the money to buy cryptocurrency via the Luno platform. Large sums were also paid to or moved to 18 other friends, business partners and their businesses, and some of the money was sent up to four times to try to hide the original source.
David Mfopha, investigator of the NPA’s asset seizure unit, said in a statement to the Pretoria High Court that the R5.7 million was actually intended to be paid out as part of the UIF’s temporary relief to workers of labor broker CSG Resources. Instead of paying the amount into CSG Resources’ Nedbank account, it ended up in Phohole’s Capitec account, from where he distributed it very quickly.
Phohole works for Promac Paint, but was one of the workers on CSG Resources’ payroll, according to court documents.
Mfopha has applied for the seizure order under the Organized Crime Prevention Act, claiming that the money was obtained through fraud and money laundering.
According to Mfopha’s statement, Phohole and his friends have not been arrested or charged, and the police investigation is still ongoing. However, he states in the statement that the money was obviously stolen from the state.
• The National Employers’ Association (Neasa) on Wednesday warned about safety problems with the UIF’s system for temporary relief applications, but on Thursday it was announced that the errors had been corrected overnight. This was after applicants were able to access the information of other applicants.