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Fraud News 2007

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 Fraud News September 2007

28

 

Fired CEO threatens to ‘rock country‘s rugby fraternity‘

 

EASTERN Province rugby‘s controversial former chief executive officer Phillip Joseph, who was suddenly fired this week, has threatened to release material he claims will “rock” South African rugby.

 

“I have dangerous material in my possession, which relates to members who served on the EP board, and this evidence will rock the rugby community,” he said yesterday.

 

State seeks 15-year sentences in toxic liquor

 

sentencing battle looms, as the state seeks to have two men convicted of fraud for manufacturing liquor containing lethal amounts of methanol jailed for 15 years.

When Johan van der Heever and Dan Padowitz make their next appearance in the Bellville regional court, on January 16, the state will argue for the prescribed minimum sentence, as the amount of fraud was in excess of R2,5-million.

 

Selebi warrant: did it lead to Pikoli axing?

 

The Scorpions have been planning to arrest National Police Commissioner Jackie Selebi for at least three months.

And it is believed that National Prosecuting Authority boss Vusi Pikoli's decision to pursue Selebi may have been the final step that led to his suspension.

Now, a week after Pikoli is understood to have obtained the arrest warrant against Selebi and amid a flurry of denial from police and state authorities, it remains unclear whether anything will come of Pikoli's efforts.

 

27

 

Media24 gets forensic audit

 

A leading forensic company has been brought in to audit Media24's 12 divisions following allegations that circulation figures at several magazines have been tampered with.

An internal Media24 statement said Edwin Nathan Sonnenberg (ENS) Forensics was conducting the extensive audit of their 12 divisions.

 

Cameroon jails 9 former state officials for fraud

 

A court in Cameroon jailed nine former state employees for between 15 and 35 years on Thursday for embezzlement in a second high-profile case against corrupt members of veteran President Paul Biya's ruling party.

 

A large group of senior state officials were arrested in February 2006 in a crackdown on graft that Biya ordered under pressure from international donors concerned by widespread corruption in the central African country.

 

Former education official charged with fraud

 

A former Western Cape education department personnel head on Thursday recounted the discomfort of being questioned by forensic investigators, when he appeared in the Bellville commercial crimes court on fraud charges.

"When you are suspended, you are caught unawares. You are told there is an investigation underway, and you are dumbfounded and don't know what's going on," testified Mogamat Kashief Galant, 40.

 

Scorpions arrest men for tender fraud

 

Four men were arrested by the Scorpions on Thursday after an investigation into tender irregularities at local government level involving photo copy machines.

National Prosecuting Authority spokesperson Tlali Tlali said the men were arrested on Thursday morning and appeared in court on a charge of fraud and contravening the municipal finance act.

"Members of the Cape Town office of the Scorpions arrested the men and they appeared in the Kimberley magistrate's court. They were released on bail of R6 000 each."

 

Ex-speaker free on fraud rap

 

The former speaker of the Rustenburg municipality, Elizabeth Seduke, was found not guilty on charges of intimidation, extortion and fraud at the Rustenburg Regional Court on Wednesday.

 

Seduke was arrested in June 2005 after a businesswoman Sharon Mathulwe, 26, accused her of threatening her with death in an attempted to extort money from her.

 

Alleged fraudster is back in the dock

 

A man who allegedly forged the signature of a Free State municipal manager and defrauded a woman of R200 000 appeared in the Harrismith magistrate's court on Wednesday, Free State police said.

 

26

 

Sandi Majali to sue Sunday Times

 

ANC funder Sandi Majali is to sue the Sunday Times for defamation following its story implicating him in the disappearance of money meant for an Eastern Cape school feeding scheme.

"Sandi Majali intends instituting a damages claim against the Sunday Times for defamation. Counsel has been briefed and the Sunday Times has been notified accordingly," said Majali's attorney Barry Aaron today.

Aaron added that a request, in terms of the Access to Information Act, for the production of a forensic auditor's report on the matter, would be sent to the office of the Eastern Cape premier. A separate letter would be sent to the premier's office demanding the "immediate release" of the report, by auditors Ngubane & Co.

 

Man had 119 blank credit cards

 

A Somali couple appeared in the Cape Town Magistrate's Court on charges of credit card fraud, national police said on Wednesday.

 

"Investigating officers seized 119 blank international credit cards, eight blank Standard Bank cards, 20 white plastic cards, three card readers (skimming devices), encoding equipment and computer software, computer equipment used to manufacture false credit cards, an HP electronic diary, two cellular phones and a wireless webcam from the house," Morokane said.

 

Scam victims can talk

 

Controversial businessman Niko Shefer has unsuccessfully applied for an interdict to stop a disgruntled investor from publishing allegations that he owed investors millions of rand.

The businessman sought to interdict Graham Torrington of Hurlingham, and also instituted a R150 000 damages claim against Torrington, after receiving a “threatening” e-mail from Torrington in August last year.

 

Land claim fraud is uncovered

 

At least 40 people who were given land or who were compensated under government’s land restitution programme might have made fraudulent land claims. Criminal action will be pursued against the perpetrators, officials say.

 

25

 

The Department of Public Works has taken a zero tolerance approach on fraud and corruption.

 

Addressing the two day Zero Tolerance Stance on Fraud and Corruption Conference, Tuesday, Public Works Minister Thoko Didiza said the department has placed a number of initiatives to deal with fraud and corruption in the department.

"Zero tolerance means just that, it means all of us in Public Works, political leaders, management, our cadre of professionals and the staff take ownership of this struggle in a concerted programme of action to defeat corruption," Minister Didiza said.

 

Getting SA’s MPs to play along on ethics not easy

LAST week the parliamentary ethics committee finally managed to legally accept receipt of the register of members’ interests.

 

It was the third request. On the first occasion, too few MPs pitched up for this to be done — at least half of the 27 committee members need to be present for a meeting to be legal.

 

African firms run big graft risk

 

AFRICAN or Middle Eastern companies are four times more likely than US firms to be exposed to bribery and corruption, according to a survey on corporate fraud involving 900 senior company executives.

 

‘Conman’ held over franchises

Stelio Nathaniel, the chief executive of Prop Holdings, was arrested last week Tuesday for allegedly defrauding unsuspecting franchisees of thousands of rands.

 

Nathaniel was charged with six counts of fraud on Wednesday and released on R20 000 bail pending trial in the Specialised Commercial Crimes Court in Pretoria.

 

Database to help crack down on ID fraudsters

 

Keep your valuables close, and your identity documents closer still.

With identity theft and impersonation spiralling out of control, ID documents and bank statements should be kept safe and under lock and key.

Stolen documents could see you racking up huge amounts of debt.

Once stolen, the information is passed on to syndicates operating in South Africa who sell the details to people who use them to commit crimes.

 

The billion-rand hole at Fidentia

 

Up to a billion rands of funds invested in Fidentia are unlikely to be recovered, say the financial group’s curators. One curator, Dines Gihwala, of Hofmeyr, Herbstein & Gihwala, says the company is expecting to recover only a further R300-million of the missing money to add to the R300-million already paid to investors.

 

23

 

Case promises peep show into Botswana’s massive insurance fraud

 

Three Botswana Police Service Officers, a panel beater and a deputy sheriff will tomorrow (Monday) appear before Chief Magistrate, Lot Moroka, in a case that is expected to provide a peep show into Botswana’s massive insurance fraud.
Police officers Badisa Maswe of Gantsi Police Station, Moreetsi Sebako stationed in Broadhurst and Malebogo Kapo of Block 8 Police Camp are accused of conspiring with Tlhopho Ketshabile, a deputy Sheriff, and Louis Lorenzo, a panel beater, to defraud Botswana Insurance Company Limited.

 

Another scandal hits ANC funder

 

Johannesburg - A businessman who diverted funds to the ANC has been implicated in the disappearance of millions of rand meant for a school feeding scheme, the Sunday Times reported on Sunday.

 

"Controversial ANC funder Sandi Majali has been fingered in a forensic audit into the disappearance of more than R100-million intended for starving children in the Eastern Cape," the report said.

 

21

 

More fraud allegations against Asap

 

A concerned bidder has blown the whistle on other tenders awarded to controversial security firm African Strategic Asset Protection (Asap) in the wake of the Mail & Guardian exposé last month.

 

Porritt's plea

Nearly five years have elapsed since the arrest of Tigon CEO Gary Porritt - a period pockmarked by about 15 postponements of the criminal case - and it remains anyone's guess when the trial will begin.

 

Porritt and fellow director Sue Bennett are in the dock for cooking the books of their two JSE-listed entities, Tigon and Shawcell (long since defunct), and face a staggering 3 160 charges extending to money-laundering, fraud and theft.

 

Police bust credit card fraudsters

 

Absa investigators and police commercial branch detectives have bust a credit and debit card fraud syndicate operating in Johannesburg. This resulted in four of the syndicate's members appearing in the Specialised Commercial Crimes Court.

 

Rasool: workers wanted to deflect attention

 

Information about over-expenditure on security at Community Safety MEC Leonard Ramatlakane's home was handed to the Auditor-General (AG) irregularly and possibly to deflect attention from employees who had defrauded his department of more than a million rand.

This was part of Premier Ebrahim Rasool's response during question time in the provincial legislature on Thursday where he said an independent investigation by Sonnenbergs had exonerated Ramatlakane of fraud and corruption.

 

Auditors fault Seta on R9m spending

CAPE TOWN — A forensic audit commissioned by the troubled Media Advertising Publishing Packaging Seta (Mappp-Seta) on transactions with service provider CreateSA has found that R9m was used irregularly.

 

The Seta has been wracked by conflict leading to the suspension and dismissal in May of former CEO Melanie Bernard-Fryer. She claimed she was victimised for blowing the whistle on fraud and corruption in the organisation.

 

20

 

Promise to speed up Mbele fraud inquiry

 

Premier S'bu Ndebele has promised to speed up the investigation into the embattled Health Department's head of department, Dr Busi Nyembezi, who is accused of fraud and corruption.

 

Thousands probed for state housing graft

 

The Special Investigating Unit has confirmed it is investigating thousands of government officials believed to have fraudulently received housing subsidies.

"We are confident that we can make a significant impact with the housing fraud investigation, even though we are only in the initial stages," SIU spokesperson Trinesha Naidoo said on Wednesday.

 

Ex-Scorpion stung hard by the law

 

For a moment the incessant chewing stopped. Judge Ezra Goldstein had just found Scorpions prosecutor Portia Kgantsi guilty of accepting bribes from a Nigerian fraudster.

"In our view she was an appalling witness, evasive, talkative and brazen," said Goldstein, delivering judgment in the Johannesburg High Court on Wednesday.

 

19

 

FirstRand in conspiracy

 

Cape Town - Martin Welz, the editor of the investigative monthly magazine noseweek, told the Cape High Court on Wednesday that FirstRand bank had been in a criminal conspiracy with its wealthy clients to defraud the revenue service by creating a tax evasion scheme.

 

Scorpions raid top PMB councillor's home

 

The ongoing investigation by the Scorpions into the Msunduzi Municipality (in Pietermaritzburg) took a dramatic turn on Tuesday when a high-profile councillor's home was raided in the morning.

The raid on Themba Zungu's house and his office at the city hall marked the first time that a political figure's premises had been raided, and has reportedly sparked a wave of panic among councillors, who fear that they could be next.

 

17

 

‘Nursing scam’ runs into millions

A multimillion-rand scandal is unfolding at the Far North Nursing School in Sibasa, Limpopo, after students laid a fraud charge against owners of the institution with the Thohoyandou police.

 

Thousands of students who had registered with the school since 2003 are still waiting to write their examinations because the school is not registered with the South African Nursing Council (Sanc).

 

Senior police officer in fraud probe

 

THE second-in-command at the police’s commercial branch in East London is under investigation for allegedly defrauding the National Prosecuting Authority’s Special Investigating Unit (SIU).

 

The case against Superintendent Mxolisi Nogemane, registered at the Cambridge police station in February, relates to alleged fraud that occurred while he was working for the SIU in Bloemfontein in 2006.

 

16

 

Calls for probe into bribe claims

 

Ivy Matsepe-Casaburri, the Communications Minister, has been drawn into a clash between her ministry and the Public Service Commission (PSC) over allegations that a senior official in her department accepted bribes from a recruitment agency and others.

The human resources executive, whose name is known to the Sunday Tribune, has been accused of receiving kick-backs and bribes from successful tender applicants, and from people newly appointed or promoted in the department.

 

14

 

Modise in the dock on fraud charges

 

The businessman who complained about allegedly unaccounted-for money donated to the South African Communist Party (SACP) appeared in the Kimberley magistrate's court on Thursday, on fraud-related charges.

Charles Modise's court appearance relates to charges of alleged fraud, forgery and defeating the end of justice in relation to tenders awarded to him in the Northern Cape.

 

13

 

Curators to meet Fidentia ‘mastermind’

 

CAPE TOWN — The curators of collapsed asset management company Fidentia were engaged in “delicate” negotiations with the main architect of the fraudulent investment scheme in a bid to get back about R100m, Parliament’s standing committee on public accounts heard yesterday.

 

Curators Dines Gihwala of Hofmeyr, Herbstein & Gihwala and George Papadakis of Gobodo Forensic Accounting reported to the committee on progress made in their attempt to recover assets for the 60000 investors, many of whom are widows and orphans with investments in the Living Hands Trust.

 

11

 

Council in ‘leave’ fraud

A former senior official at the Polokwane municipality in Limpopo is in hot water after he was found to have misappropriated more than R600 000 from the municipality.

 

The official, who worked as a paymaster for more than 16 years, has since resigned. An investigation by Sowetan has found that Braam Duvenhage tendered his resignation on May 22, a day before he was to appear before the municipality’s disciplinary hearing for the alleged misappropriation of funds.

 

10

 

Tender scandals mount

 

GAUTENG – Three major tender scandals have flared up.

 

Limpopo Health MEC Sekoati Seaparo, yesterday admitted he was a shareholder in companies which won contracts from the provincial government.

 

Seaparo said he was a shareholder but not a director who saw the day to day running of them.

 

Seaparo is alleged to have benefited by more than R500 million through his companies.

 

Whistle-blower's allegations ‘not true'

 

The senior executive accused of job piracy and fraud is not under investigation, says Department of Communications director-general Lyndall Shope-Mafole.

 

Land bank : Answer to Land Bank investigation raises further questions

 

A reply by the Minister of Agriculture and Land Affairs Lulu Xingwana to written parliamentary questions submitted by the DA on the forensic investigation into the financial affairs of the Land Bank, confirms suspicions of interference into the work of the independent auditors investigating the Land Bank and raises further questions.

 

9

 

Millions stolen from investors

 

Johannesburg - A shocking story unfolded in the Pretoria High Court this week of how investors lost R300m in illegal schemes where one individual enriched himself by building a property portfolio worth million of rands.

 

Giving fraudsters a helping hand

 

Credit card companies wonder where people got the idea not to sign their credit cards, writes David Migoya.

 

Consumers generally intend to deter identity theft and fraud — but the reality is that they may actually be helping them.

 

Thousands of consumers in the US have written “See ID” or “Ask For ID” on the back of their credit or debit cards instead of a signature, believing the practice will thwart fraudsters.

 

After all, how could someone use a card fraudulently if they’re asked to produce identification with it?

 

7

 

Bail in bank employee fraud case continues

 

In an eight-year spending spree Clynton Cotton lived a jet set lifestyle of regular overseas trips and big ticket purchases that included buying golf equipment to the tune of R100 000.

Funding his extravagant lifestyle were almost 100 unsuspecting FNB clients who trusted him as a financial adviser to manage their investments. During the time he fleeced his Overport branch clients to the value of R21-million, he earned a comfortable salary of almost R30 000 a month.

 

3

 

Seven health workers arrested for fraud

 

Seven provincial health department employees appeared in the Durban magistrate's court on Monday, charged with fraud, corruption and money laundering.

The case against the six men and a woman was remanded to September 11, KwaZulu-Natal police said.

"They were all granted bail," said Senior Superintendent Phindile Radebe.

 

2

 

Scam takes R6m from pension fund

 

Confessions of how a former KwaZulu-Natal hospital clerk and her national treasury counterpart defrauded the government of R6-million have highlighted costly loopholes in the state employee pension payout system.

The racket centred on the fraudulent inflation of pension payouts on behalf of resigning government employees.

 

Private eye accused of fraud

 

A beefy bodybuilder and debt-collector-turned-private investigator has been accused of conning “clients” out of hundreds of thousands of rands.

 

Among those drawn into 40-year-old Howard Galvin’s alleged web of deceit are his own grandfather and the family of a murdered Joburg hotelier.

 

Last month Galvin, from the Joburg suburb of Greenside, was in court for allegedly stealing more than R410 000. He is due back in court this month.