The National Prosecuting Authority’s Asset Forfeiture Unit (NPA AFU) has been granted an order in the Eastern Cape High Court to recoup at least R35 million in bogus Unemployment Insurance Fund (UIF) COVID-19 Temporary Employee/Employer Relief Scheme (TERS) applications.
This after an investigation found that during the height of the COVID-19 pandemic, the Chief Executive Officer of the Eastern Cape Transport Tertiary Co-Operative Limited (ECTTC), Dr Nokuthula Mbebe, made several bogus applications to the UIF for TERS payments.
The ECTTC is an umbrella organisation that assists co-operatives to comply with the law and ensure that the local transport industry is regulated.
According to NPA regional spokesperson, Luxolo Tyali, the applications made by the ECTTC were riddled with discrepancies.
“The ECTTC made applications on behalf of its own employees, as well as on behalf of the employees of the affiliate taxi co-operatives that belong to the ECTTC. There were a large number of irregularities… including applications for TERS benefits for 22 persons in the employ of government, 22 persons who were deceased and one person who was incarcerated at the time – persons who obviously did not qualify for the benefits.
“After further investigation, it was discovered that the information – with regard to the incarcerated person and at least one of the deceased persons – was incorrect. The AFU relied on information from the UIF investigators who, in turn, relied on information from the Auditor-General — information that was not accurate. The correct information was eventually relayed to the court with regard to the mentioned deceased person and incarcerated individual,” Tyali said.
He said a further 66 applications were made through the ECTTC, which resulted in a payment of some R220 million.
“When the UIF began to audit these payments, the ECTTC and its affiliate taxi co-operatives could not verify the correctness of the applications via documentary evidence or a paper trail. This is in contravention of the directives made in relation to TERS payments, as well as the Memorandum of Agreement that all entities applying for TERS funds must sign.
“The payments, as they stand, remain the proceeds of unlawful activities, as they do not comply with the law,” Tyali said.
The AFU had already been granted three preservation orders freezing 36 different bank accounts “belonging to the ECTTC, as well as its affiliate taxi co-operatives and linked business entities” and R35 million from these accounts will be reimbursed to the UIF.
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