By STAFF REPORTER
The Makhanda high court last week ordered taxi umbrella body the Eastern Cape Transport Tertiary Co-operative (ECTCC) to return R35-million misappropriated from the Covid-19 temporary employee/employers relief scheme (TERS) to the Unemployment Insurance Fund (UIF).
The TERS funds were intended as a special benefit under the UIF to employees who lost income due to the COVID-19 lockdown.
The court upheld the UIF’s assertion that the ECTCC’s applications for Covid-19 TERS funds were fraudulent because the intended recipients were not eligible for the benefits and amounted to unlawful activities, according to the UIF communication director Makhosonke Buthelezi.
One of the requirements in the Covid–19 TERS directive is that an employer applying for the benefits must submit a letter of authority and a signed Memorandum of Agreement (MoA) with the UIF.
“The applications contravened the MoA, which provides that an employer would only qualify for the benefit if the temporary closure of its business operations is a direct result of the pandemic, and they contravened Item 7 of the MoA, which provides that the employer undertakes to use the benefits exclusively and solely for the purpose of paying the benefits to its employees,” Tyali said.
The ECTTC submitted applications for benefits on behalf of other applicants as employers and was paid in six instalments in one banking account for the total sum of R19.7-million.
UIF Commissioner Teboho Marupings said this had raised a red flag. “We initiated an interim audit which revealed irregularities that included applications made on behalf of government employees, deceased individuals and prisoners”, he said.
A further investigation revealed that sixty-six entities submitted applications for benefits using the same contact details and collectively received R220.5-million.
In March 2021, the UIF opened a criminal case with the South African Police Service (SAPS). In July 2021, the Fund applied for a preservation order to freeze the bank accounts to prevent further loss of Covid–19 TERS funds already paid to ECTTC and its affiliates.
“We have always warned those who fleeced the Fund that we are coming for you. The fantastic cooperation between the Fund and law enforcement agencies will ensure that more suspected criminals are brought to book to account for their unlawful conduct. We will not rest until we have followed and accounted for every cent and rand paid through Covid-19 TERS and where wrongdoing is uncovered, the law must take its course and wrongdoers are brought to book”, Maruping said.
