Western Cape farmer in hot water in Covid-19 TERS fraud allegation
04 November 2020

​​[Graafwater, Western Cape] The Department of Employment and Labour this week responded to allegations that a local farmer in the Western Cape defrauded the COVID-19 Temporary Employer/Employee Relief Scheme (TERS).  The Inspectorate received a complaint about Dagbreek Farm in Graafwater where the employer allegedly claimed TERS funds on behalf of seven employees whilst they still received full salaries.  Graafwater is a small agricultural town approximately 300 kilometres from Cape Town.

 

The COVID-19 TERS was one of the instruments instituted by government as part of the R500-billion relief package.  The COVID-19 TERS is a specialised fund which is administered by the Unemployment Insurance Fund (UIF) for workers whose salaries have been affected by the implementation of the National State of Disaster and subsequent lock-down period.

 

The Provincial Chief Inspector (PCI), David Esau, was requested to meet with workers at the Graafwater Police Station where statements were made to the local police.  Their statements include that they were deemed as essential service workers since 27 March 2020, continued to work and received their full salaries and therefore did not qualify TERS.  The statement of the employees further demonstrate that the employer transferred the TERS monies into their bank accounts and then accompanied the employees to the ATM and waited for them to make withdrawals and return the money to the employer.  According to the workers, the employer had convinced them that he would return the money to the Fund. Furthermore, some employees had limits on their banking transactions and the employer proceeded to make deductions from their salaries to make up for the outstanding amounts.

 

According to Esau, the employer may be prosecuted for defrauding the Fund, “The employer claimed TERS for the period of 27 March 2020 until 15 September 2020 for all seven employees, totalling an amount of R109,376.39.  The Department is in possession of the bank statements of the workers which shows that the money was paid into their bank accounts from the employer's bank account. Our records further indicate that at no stage did the employer return the money to the Fund and this is therefore deemed as a Criminal offence which the South African Police Service in Graafwater is dealing with". 

 

The Inspectorate confirms that attempts to reach the employer has been unsuccessful, however the Department is in the process of working with other government agencies to locate the employer.  It is the intention of the Inspectorate to supply SAPS with the full report and proof of payments transferred to the employer within seven-days to assist with building the case.

 

Esau went on to say that the Inspectorate's focus is now on recouping COVID-19 TERS monies for employees and also on effecting refunds to the Fund where misuse or non-payment is demonstrated.  “The Inspectorate has to date received many complaints from workers who allege that their employers have applied for TERS but they have not received any payment.  Our inspectors, together with Unemployment Insurance Fund auditors have been instructed to visit those workplaces from which complaints emanate.  We encourage workers to make contact with the Department so that these irregularities and non compliance to the law may be addressed," he said. 

 

The work of the Inspectorate will serve to amplify the “follow the money" initiative of the UIF where similar auditing processes are followed to determined that the correct TERS amounts were paid to eligible recipients.

 

For more information, contact:

David Esau

Provincial Chief Inspector

082 791 4485

 

“Please continue to adhere to the lockdown regulations. Wash hands, sanitise and wear your mask.

 

-ENDS-

 

Issued by: Department of Employment and Labour


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