Companies that received money through the Covid-19 Temporary Employer-Employee Relief Scheme (TERS) can expect a visit from forensic auditors that will examine their financial records to check the authenticity of their claims and verify if the money was paid over to workers.
The Unemployment Insurance Fund (UIF) said it has appointed seven companies with auditing, accounting and forensic investigation expertise to ‘follow the money’ for all Covid-19 TERS payments.
The companies will assist the UIF to recoup monies owed by employers and report fraud to law enforcement institutions.
They will also help with recovering UIF contributions, including interest and penalties owed to the fund due to new employees being declared during the lockdown.
The UIF said that employers who benefitted from the TERS need to prepare the following information either manually or electronically:
- UIF Covid-19 TERS application pack;
- Bank statements relating to Covid-19 TERS application;
- Each employee file;
- Payroll report from 1 January 2020 to July 2020.
Acting UIF commissioner, Marsha Bronkhorst said the fund is serious about eliminating fraud given the plethora of complaints and allegations that some companies were stealing the money that was intended for their workers.
“Over the past few months, we have seen with great disappointment that some companies received the Covid-19 TERS benefits, but failed to pay it over to their workers,” she said.
Bronkhorst said that there are also allegations that employers were paying part of the money and not the full amount, as well as companies using the money for something else other than the intended purpose.
“Just this week, the National Prosecuting Authority froze R111 million from a businessman who allegedly claimed Covid-19 TERS for 6,600 people when he was the only worker.
“More cases will follow for those who tried to take a shortcut and they will be held to account,” said Bronkhorst.
Bronkhorst said that from the beginning of the Covid-19 TERS benefit payments, the UIF has always been cognisant of possible risks of fraud.
“Our intention, as the UIF was always to support companies, workers and our economy during the lockdown, but the plan was always to conduct a comprehensive audit of all the payments.
“I am therefore urging all companies and employers who have benefitted from Covid 19 TERS to co-operate with the forensic auditors and supply all the required information within the specified time frames.
“Failure to comply will lead to legal action,” the acting commissioner said.
The Covid-19 TERS Relief Scheme was established to assist employees who lost income during the lockdown periods. Since March 2020, just over R54 billion has been paid in 12,757,287 payments through 1 million-plus employers.