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Labour minister praises police after arrests in UIF fraud scheme involving fake companies and stolen identities.
Minister of Employment and Labour Nomakhosazana Meth. Picture: Department of Employment and Labour
Employment and Labour Minister Nomakhosazana Meth has welcomed the arrest of a Labour department manager and several others in a major Unemployment Insurance Fund (UIF) fraud takedown across the Free State and Gauteng.
The authorities uncovered a syndicate using fake companies and stolen identities to defraud the fund.
Police in the Free State launched a takedown operation on Thursday in Bloemfontein, Bethlehem and Gauteng, following a detailed Crime Intelligence probe into fraud and corruption at the Department of Labour.
Syndicate to defraud UIF
Free State police spokesperson Brigadier Motantsi Makhele said the starting point was at the Labour House in the Bloemfontein CBD, where one person of interest was arrested.
Makhele said this comes following months of painstaking research into a complex fraud involving false claims for funds from the UIF.
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“It is alleged that the masterminds behind this operation recruited unsuspecting individuals and used their personal information to register fictitious companies, which in turn submitted false claims to the Department of Labour,” Makhele said.
“The fraudulently obtained funds would then be shared among the recruiter (or runner), in some cases even the person whose identity was used.”
Estimated R1.5 million lost
According to estimates, the department may have lost more than R1.5 million.
Police arrested a 42-year-old office manager at Labour House in Bloemfontein, marking the key breakthrough in Thursday’s operation. He is thought to have played a significant part in facilitating the illegal operation, which spanned the provinces of Gauteng and the Free State.
The minister condemned the actions, saying the department was appalled by the betrayal of public trust by individuals who sought to enrich themselves through criminal conduct.
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“Such acts not only undermine our systems but also rob deserving South Africans of support during times of need,” Meth said.
Makhele said the operation only marks the beginning. Arrests continued in various towns across the Free State and at identified locations in Gauteng.
He said the operation is expected to result in the arrest of approximately 20 suspects.
Internal investigations and disciplinary action
The minister confirmed that the department is fully cooperating with the police and other law enforcement agencies. Meth said officials will launch internal investigations and disciplinary action against implicated employees.
“We commend Saps [South African Police Service] for its professionalism, and we will leave no stone unturned in dealing with fraud and corruption in the department, its funds and entities,” she said.
“The department is reviewing its internal controls and will intensify risk management, fraud prevention and system audit processes across all its operating environments.”
Lieutenant General Baile Motswenyane, the Saps’ Free State provincial commissioner, praised the team for their commitment and precise operation execution.
Motswenyane said it’s essential that those who take advantage of government systems for their own financial gain be held responsible for their conduct.
Take advantage of government systems
“I applaud our investigators for their tireless efforts and unwavering commitment to justice. This case serves as a warning that crime does not pay and that we will continue to dismantle criminal networks wherever they exist,” said Motswenyane.
The suspects are scheduled to appear in the Bloemfontein Magistrate’s Court on Monday. Investigations are ongoing, and more arrests are imminent.
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“Let this be a strong warning: unethical conduct will not be tolerated. We will ensure accountability and transparency in our operations. Crime will not go unpunished,” Meth said.
