Durban VAT fraudster jailed over R3.7m SARS scam
The businesswoman who submitted fraudulent VAT returns to claim millions in unlawful refunds was sentenced to 18 years behind bars.
A DURBAN woman has been sentenced to 18 years’ imprisonment after defrauding the South African Revenue Service (SARS) of more than R3.7m through fraudulent Value-Added Tax (VAT) refund claims.
The Durban Regional Court convicted 53-year-old Khanyisile Casianna Gumede on five counts of fraud and one count of money laundering. Her company, GG Catering and General Services CC, was also fined R2m, wholly suspended for five years on condition that it is not convicted of fraud, theft or attempted fraud or theft during the suspension period.
According to the National Prosecuting Authority (NPA) regional spokesperson Natasha Ramkisson-Kara, Gumede, who served as the company’s VAT representative, submitted fraudulent VAT returns between February and October 2018 by inflating input tax and declaring nil output tax.
Ramkisson-Kara confirmed that during the investigation it was discovered that the company was registered for VAT with SARS but not trading during that period. “The fraud was uncovered during a SARS investigation,” she said.
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“These false declarations resulted in unlawful VAT refunds, despite the company not trading during that period and therefore not incurring any qualifying expenses. As a result, SARS suffered a loss of over R3.7m.”
Gumede is said to have used the funds for various purposes, including settling a debt owed by the company. During the trial, State Advocate Zinhle Mthembu presented evidence from five witnesses, including SARS officials and a former employee of Gumede.
“The investigator informed the court that SARS had suffered a loss of R3.7m, none of which had been recovered.”
The court sentenced Gumede to 15 years’ imprisonment for fraud and 10 years for money laundering. Seven years of the money laundering sentence will run concurrently with the fraud sentence, resulting in an effective sentence of 18 years’ direct imprisonment.
She was also declared unfit to possess a firearm.
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