Frustration at the slowness of corruption investigations

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Civilian activist Organization Undoing Tax Abuse (Outa) has expressed deep frustration at the pace of investigations and prosecutions of corrupt individuals within the South African government and civil society.

Outa CEO Wayne Duvenhage said civilian activists and other nonprofits play a much bigger role than authorities in speeding up some corruption cases.

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However, it frustrates them when they are doing a lot of work and nothing is happening because the authorities just want “more and more” information.

“We believe that right now a lot more people should be in court and probably in jail. It takes way too long. ”

Duvenhage said all one needs is clear evidence of wrongdoing.

He was participating in a roundtable on SA’s ability to recover money stolen from the Tax Indaba, organized by the South African Tax Institute (Sait).

Authorities often keep digging and try to cover their tracks by having more than one arrow in their quiver. “You only need it if your shot is very precise. Digging more and more only muddies the water, brings more people into the process, and makes the case more complicated. This is how people get by, ”he said.

Enjoying the fruits of bad behavior

“This is why we are frustrated that for many years there has been so much evidence, but people are still walking the streets and enjoying the fruits of their misbehavior. It’s not good enough. ”

Several investigative journalists have thoroughly investigated the financial schemes of prominent politicians and their tax returns.

Read: Breaking asbestos: more details emerge at the Zondo Commission

To the public, the amount of forensic evidence that has already been uncovered and exposed through these investigations, as well as that of Outa and Corruption Watch, it seems many cases are a slam dunk.

However, there is no looking back on the progress. the South African tax service (Sars) did on any of the bidders information or politicians’ underreporting of assets and income.

Read: SA investigation finds evidence of political pressure and fraud in Covid-19 contracts

Burden of proof

Raheema Ismail, senior director of investigations at Sars, noted that the burden of proof on Sars and other enforcement agencies is more onerous.

“We have different responsibilities and responsibilities. It may seem that the information gathered by journalists or civilian nonprofit activists is enough to prosecute someone, but we have to dig deep enough. ”

It is necessary to bring a solid case to court, even if it is only this one. “It would be remiss of us to do only part of our job in bringing a case to criminal prosecution. We must do everything in our power to be successful. ”

Read: Sars, did you tax that Aston Martin?

Ismail said it wasn’t just about getting the stolen money back or putting someone behind bars. It must be both, but it must be based on the principle of proportionality.

The legislation is normative with regard to penalties for certain behaviors. If we simply attack the tax, it is likely that in some cases the behavior will not change.

Collect the money

Chad Thomas, CEO of IRS Forensic Investigations, said there is a “symbiotic relationship” between corrupt actors in the public sector and those in the private sector. The relationship was created to plunder the public purse; whether by inflating a call for tenders or creating calls for tenders.

Read: Why didn’t PwC identify corruption at SAA?

One of the ways to recover the stolen money is to seize the pension funds of those involved in criminal and corrupt activities. This method is not used often enough, he said.

“Funds can be returned to the tax authorities to provide some form of restitution in addition to criminal restitution. By tying up the pension fund, it can be used as a negotiating tool.

No one wants to lose their pension, but if the money can keep them from going to jail, that becomes a whole different story.

Thomas said the legislation allows for the preservation of assets and pension funds even if the person has not been convicted – it is possible to put in place interim preservation orders.

“Once the funds are preserved [they] cannot be used for any other purpose, except perhaps for the accused in relation to reasonable legal costs.

Read: Tax is an important weapon to recover “ill-gotten goods”

“Politically protected unit”

Sait CEO Keith Engel referred to the VIP unit created by Sars to deal with the tax affairs of high net worth individuals, senior officials, judges, the chief of the military and other prominent figures.

The rumor is that the unit is really the politically protected unit, he said.

“If the unit is looking after you, it looks like you are immune from audits.”

Ismail brushed off the rumor, saying it wasn’t created for anyone’s protection. “It’s not a ranking that grants privileges. This does not imply any privilege. It is only to improve the service offer [by Sars],” she said.

Engel acknowledged that privacy laws, particularly in civil tax findings, remain important to Sars.

However, the Nugent Commission of Inquiry into Governance and Tax Administration in Sars heard from a former legal affairs official that she had been ordered to waive the tax or penalties for certain people who were part of the unit at the time of the state capture. .

To read: The bankers, lawyers and liars who allowed the capture by the state


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