Home South African Asset Forfeiture Unit swoops on ‘UIF looter’

Asset Forfeiture Unit swoops on ‘UIF looter’

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Unit gets court order to freeze bank account of businessman suspected of stealing R700?000 meant for 150 workers

File picture: SAPS

THE ASSET Forfeiture Unit (AFU) has moved swiftly to freeze the bank account of a businessman accused of looting almost R700 000 from the Unemployment Insurance Fund (UIF) that was meant to bring relief to more than 150 Covid-19-hit workers.

The North Gauteng High Court in Pretoria granted the AFU of the National Prosecuting Authority (NPA) a preservation order to freeze a bank account linked to businessman Thokozani Mchunu. This followed suspicions that he fraudulently received funds from the UIF.

NPA spokesperson Sipho Ngwema said R692 185.55 was fraudulently, or mistakenly, paid into a bank account in Durban, which is registered in Mchunu’s name.

According to him, a Durban company called National Adhesive Distributors successfully applied to the Covid-19 relief fund on April 15 for R692 185.55. This was on behalf of its employees and their dependents.

These funds were to be paid to more than 150 employees and their dependants.

The UIF was alerted by the company on June 12 that the funds had not reflected in its bank account.

It was discovered that the funds went into Mchunu’s account.

He is said to be a private individual who wasn’t employed by the UIF or by National Adhesive Distributors.

Following this discovery, the matter was reported to the police which acted swiftly and alerted the Financial Intelligence Centre.

They intervened promptly in terms of the Financial Intelligence Centre Act and froze the relevant accounts, Ngwema said.

After receiving the funds, Mchunu allegedly transferred portions of the money into other bank accounts held by himself, various stokvel accounts and numerous bank accounts of other individuals.

The transfer of the funds into the accounts was done in an attempt to disguise the origin of the funds, it is claimed.

“Police are continuing with investigations into allegations of fraud, and or theft, as well as money laundering.

“The Asset Forfeiture Unit applied for the preservation order to permanently forfeit the money to the State,” added Ngwema.

The operation was a direct product of the “Fusion Centre”, which was established, among other things, as an urgent intervention to address unlawful activities related to Covid-19 relief funds.

Last month the court also sent out a strong message that fraud pertaining to these funds would not be tolerated, when it froze millions in another account into which UIF funds were allegedly fraudulently paid.

The AFU obtained a preservation order for R5.7 million in relation to money paid fraudulently, or alternatively, mistakenly, into the bank account of Tshepang Phohole, who worked as a packer in a warehouse in Pretoria.

The money was earmarked for 1 400 workers from the company, CSG Resourcing, but was paid into Phohole’s account.

It was claimed that he went on a shopping spree and gave millions of rand to his family.

Phohole and four others linked to this alleged fraud or theft, were arrested and released on bail.

The case was postponed to September 7 for further investigation.

This came as President Cyril Ramaphosa signed a proclamation last week authorising the Special Investigating Unit (SIU) to probe allegations of fraud, corruption and inflated pricing related to the R500 billion Covid-19 relief fund.

“We are determined that every instance of alleged corruption must be thoroughly investigated, that those responsible for wrongdoing should be prosecuted and that all monies stolen or overpriced are recovered. In order to speed up and strengthen the process of dealing with corruption, I have today signed a proclamation authorising the Special Investigating Unit to investigate any unlawful or improper conduct in the procurement of any goods, works and services during or related to the national state of disaster in any state institution. This empowers the SIU to probe any allegations relating to the misuse of Covid-19 funds across all spheres of the state. If the SIU finds evidence that a criminal offence has been committed, it is obliged to refer such evidence to the prosecuting authority,” Ramaphosa said.