SIU investigates massive UIF fraud involving 6,000 state employees and billions in false claims

The Special Investigating Unit (SIU) has revealed that its ongoing investigation into Unemployment Insurance Fund (UIF) fraud has uncovered significant irregularities, including false claims made by 6,000 state employees across 24 government departments and thousands of private entities.

According to the SIU, the fraudulent claims, which amount to billions of rands, were made through the Temporary Employer/Employee Relief Scheme (TERS), which was introduced during the COVID-19 pandemic to support workers who had lost income due to lockdown restrictions.

SIU Briefs SCOPA on UIF Fraud Findings

The SIU provided an update on its multi-year investigation during a briefing to the Standing Committee on Public Accounts (SCOPA) in Parliament today.

Speaking at the briefing, SIU Chief Operations Officer Leonard Lekgetho detailed how various companies and individuals exploited the UIF system by submitting fraudulent claims on behalf of people who were not eligible for relief payments.

“In many cases, claims were submitted for people who had long retired or had resigned from their jobs years ago,” said Lekgetho.

The scale of fraud uncovered by the SIU highlights the widespread abuse of the relief scheme, raising serious concerns about oversight and accountability within the UIF system.

How the Fraud Was Committed

The SIU found that many private companies and state employees took advantage of loopholes in the TERS scheme to illegally claim funds.

Some of the fraudulent activities included:

Submitting claims for non-existent employees
Applying for UIF relief for workers who had already retired
Using stolen or false identities to claim benefits
State employees applying for relief funds while still receiving full government salaries

Lekgetho explained that many of these fraudulent claims were made by employers who would submit a list of supposed beneficiaries, including individuals who were no longer employed.

“In most instances, these companies would simply submit a list to the UIF, even including people who had retired or resigned years ago,” he said.

Billions Lost to UIF Fraud

The total amount of fraudulent UIF claims is estimated to be in the billions, with both private sector companies and government employees involved in the widespread abuse of funds.

The TERS scheme, which was meant to provide emergency financial support to struggling workers during the COVID-19 pandemic, instead became a target for corruption and financial misconduct.

Government’s Response and Next Steps

The SIU investigation is part of a broader effort to recover misappropriated UIF funds and hold those responsible accountable.

Some key actions being taken include:

✅ Criminal and civil proceedings against individuals and companies found guilty of fraud
✅ Disciplinary action against government employees who were involved in illegal claims
✅ Recovery of stolen UIF funds through legal processes
✅ Stronger oversight measures to prevent future fraud

The SIU has already recovered millions of rands in fraudulently claimed UIF relief, but much work remains to be done to track down and prosecute offenders.

Calls for Greater Transparency and Accountability

Members of SCOPA have urged the Department of Employment and Labour and the UIF to improve monitoring systems and strengthen controls to prevent such widespread fraud from happening again.

There have also been calls for harsher consequences for those who abused the system, particularly for government employees who took advantage of taxpayer funds.

SCOPA members emphasized that state employees found guilty of UIF fraud should face criminal prosecution and be permanently barred from government employment.

Conclusion: A Fight Against Corruption

The SIU’s investigation into UIF fraud has exposed deep weaknesses in the system and highlights the need for urgent reforms.

As authorities continue their crackdown, more arrests and recoveries are expected, sending a strong message that fraud and corruption will not be tolerated.

With billions lost, the focus now shifts to holding perpetrators accountable and ensuring that UIF relief funds truly serve those who need them most.