At more than R18-billion, the amount of fraud under=20 investigation poses a serious problem for police. Reg=20 Rumney reports
Around R18,5-billion of white-collar crime is under=20 investigation in South Africa at present.
The Office for Serious Offences is investigating around=20 R9,5-billion worth of fraud, while the South African=20 Police Commercial branch is investigating around 23 000=20 matters involving R9-billion, according to Bell, Dewar Hall partner Nic Roodt. The commercial branch, he added,=20 had only around 700 detectives.
His comments were made against the background of the=20 frightening picture of corruption and crime that is=20 being painted by the Council of South African Banks as=20 it tries to whip up enthusiasm for the coming Business=20 Initiative against Corruption and Crime Conference.
At the same Press conference this week, the head of the=20 Amalgamated Banks of South Africa’s (ABSA) fraud=20 investigation division Roy Simpson said the average=20 value in the amounts in fraud dockets had risen by 55=20 percent between December 1992 and June 1995.
Simpson sketched a frightening picture of the fraud=20
“The types of attacks being perpetrated against=20 financial institutions are horrendous.”=20
He noted that a fraud of R3,7-billion some time ago was=20 actually R15,5-billion.
“Can you imagine any business sustaining a loss of that=20 amount off its bottom line?”=20
The effect would be to put the business itself under,=20 with further economic ripples.
South Africa was not alone in seeing an increase in=20 crime. It was an international trend.
Moreover, the normalisation of the country had opened=20 our doors to the world’s criminals.
Around 81 cases a day were being reported, and some of=20 these cases took two to three years to be completed.=20
The main threat was syndicated crime. Groups of=20 criminals had got together in highly organised and=20 sophisticated syndicates.
“The cherry on top is that we are running into money=20
He remarked that this did not only involve drugs, but=20 dirty money from other crimes, such as car theft.
Simpson pointed out that the public was beginning to=20 tire of fraud statistics. Sensationalising the fraud=20 problem would not serve much purpose.
He said crime would have to be tackled on a partnership=20 basis between the government and citizens, and noted the=20 banks had got together to form a joint commitee to=20 liaise with the police on fraud.
Indeed, Roodt’s mention of fraud figures was designed to=20 illustrate the understaffing of the police and the need=20 for business to get more involved in seeing that justice=20 is done.=20
Business, he said, should not abdicate responsibility=20 for combating crime. He noted that Simpson’s division=20 carefully prepared dockets for the police when a bank=20 fraud was under investigation.
Companies should get both a lawyer and an accountant=20 involved at an early stage, in preparing a case against=20 an employee found committing fraud, said Roodt.=20
This would ensure the matter would be investigated=20
It is well known that many fraud cases are not=20 reported, as businesses try to avoid bad publicity and=20 make it easier to recover money lost =20
Aside from the implication that fraud statistics are=20 under-reported, this also means that criminals are=20 constantly released back into the system.
One of the challenges of the forthcoming business=20 initative will be to persuade firms that it is worth=20 taking a stand and making the effort to prosecute such=20