The Unemployment Insurance Fund (UIF) welcomes the arrests of 16 suspects who are accused of swindling the Fund’s Covid-19 Temporary Employer-Employee Relief Scheme of R2,2 million. The suspects were apprehended respectively in Gauteng and North West province by the South African Police Services’ Directorate for Priority Crime Investigation, known as the Hawks.

PERSONAL ENRICHMENT

During the height of the Covid-19 pandemic in 2020, three sole directors of different dormant entities applied for Covid-19 TERS funds from the UIF on behalf of respectively 47, 133, and 141 people, who were seemingly not employed by them.  At least R2,2 million in Covid-19 TERS funds was subsequently paid into the companies' bank accounts and the money was channeled to certain individuals for personal enrichment.

SUSPECTS ARRESTED

Following months of investigations into this matter, the suspects were traced and arrested on Sunday. They  appeared in the Mahikeng Magistrates Court on charges of fraud. UIF Commissioner, Teboho Maruping welcomed the latest arrests and  commended the Hawks and the Department of Employment and Labour’s Risk, Anti-Fraud and Integrity Management unit in the North West province for their relentless hard work in bringing Covid-19 TERS fraud suspects to book. "The arrests of these 16 suspects in one operation is the biggest we have witnessed thus far, since the establishment of the Covid-19 TERS scheme. I hope this bold action sends a strong and clear message to would-be and other fraudsters that the long arm of the law will catch up with them. Those who have helped themselves to the funds earmarked for workers during the lockdowns must not have any peace. They must know that the net is closing in on them. We will continue to work with all the law enforcement agencies including the Hawks the Special Investigating Unit, National Prosecuting Authority at the Fusion Centre in our relentless pursuit to bring all Covid-19 TERS fraudsters to book, and we will leave no stone unturned in this journey,” said Maruping.

FOLLOW THE MONEY

The Commissioner also revealed that the Fund was already conducting Phase 2 of the “follow the money” project which entails auditing of companies to verify if their claims were valid, and if the right amount of money, was paid over to workers at the right time. “We have appointed several forensic audit firms with over 360 auditors that are currently visiting companies thatbenefitted from Covid-19 TERS funds and are suspected of fraud. Until all fraudulent funds are fully recovered and the suspects held accountable, we will not rest. In this regard, the UIF will continue to work with the Department of Employment and Labour’s Risk, Anti-Fraud and Integrity Management unit and law enforcement partners,” said Maruping.

MORE ARRESTS IN THE PIPELINE

In 2020, the UIF was entrusted with the responsibility of alleviating poverty in the country by providing short-term financial relief to businesses and workers in order for our economy to survive the devastating impact of the Covid-19 pandemic. 10 people have been convicted and sentenced to direct imprisonment or suspended sentences for defrauding the Covid-19 TERS scheme. Meanwhile, 46 suspects have been arrested thus far and the Fund anticipates more arrests as Phase 2 of the “follow the money” project, which started in July this year, continues.