- The Unemployment Insurance Fund said it had found 75 reported cases where applicants may have attempted to defraud it.
- UIF's Covid-19 temporary employer-employee relief scheme received 456 698 valid applications, representing 4 447 722 employees and paid out R27.1 billion.
- UIF commissioner Teboho Marupeng said instances where the wrong account was paid by the UIF were referred to the Hawks for investigation.
The Unemployment Insurance Fund told Parliament on Friday that it had found 75 reported cases where applicants may have attempted to defraud the fund of money meant to support businesses and employees during the Covid-19 pandemic.
During a virtual briefing to Parliament's Standing Committee on Public Accounts, the UIF unpacked the progress they have made in responding to the impact of the health crisis on businesses and their employees.
The UIF usually pays out sums of money to employees who contribute to the fund once they have lost their jobs. However, the fund has had to kick into action with funding protections for businesses affected by Covid-19 and the national lockdown so they can continue paying salaries whilst closed.
From 17 June, the UIF's Covid-19 temporary employer-employee relief scheme (TERS) received 456 698 valid applications out of 462 248, representing 4 447 722 employees out of 5 736 339, with R27.1 billion to be paid to the valid applications.
Minister of Labour and Employment, Thulas Nxesi, previously told Parliament that it found instances where employers overclaimed staff complement when applying for the Covid-19 TERS and other instances where employers received funds and did not pass them on to employees.
UIF commissioner Teboho Marupeng said the risk anti-corruption and integrity management unit had received a total of 75 reported cases of possible fraud among the claims which were made by employers during the pandemic.
"As of 19 of June, only sixteen cases were finalised, and two criminal cases instituted by complainants. Fifty-nine cases are still under investigation, with cases in different stages of investigations as at 19 June," said Marupeng.
Marupeng said instances of suspected fraud included R700 000 paid into an incorrect bank account, which was a matter under investigation. Another R4.7 million was paid into an incorrect bank account, but the UIF managed to recover R4.6 million with the assistance of banks.
"There was also a suspected R5.7 million paid into an incorrect bank account. A criminal case was opened by the employer and UIF is working with the Hawks on the matter with arrest imminent," Marupeng said.
He said 31 companies have been assessed in terms of "Follow The Money" principle, a system the UIF designed to monitor compliance to the Covid-19 TERS by employers.
SCOPA member and African National Congress MP Sakhumzi Somyo asked why there were delays in ensuring consequence management when it came to attempts at defrauding the UIF's system and the Covid-19 TERS.
SCOPA chair Mkhuleko Hlengwa asked what was stopping the UIF from paying employees directly or track the movement of their own money within the system. He said the current system places employers over employees in a manner that is undesirable for the latter.
Marupeng said the UIF was working closely with the Hawks to conclude the investigations into possible instances of fraud.
He said the "Follow The Money" system's tender had to be updated to allow international auditing firms that may not have accreditation from the South African Institute of Chartered Accountants but have equivalent accreditation to apply.
Cosatu parliamentary spokesman, Matthew Parks said the UIF system was never built for an economic shutdown such as the one that South Africa was currently experiencing.
"The daily complaints from workers are about not receiving funds. Employers have similar complaints. There are instances of corruption as well where employers do not pass on the disbursements," said Parks.
Parks said Cosatu has had daily engagements with the UIF. He said the fund must name and shame all offending employers as well as get the National Prosecuting Authority must get involved in their current cases.