KEY POINTS
- Taxpayers report fraudulent accounts receiving their SARS refunds.
- Victims of the SARS refund fraud struggle to recover their lost funds.
- SARS and banks are facing pressure to strengthen security measures.
Scores of South African taxpayers have fallen victim to a fraudulent tax refund scam, where their rebates from the South African Revenue Service (SARS) were deposited into bogus bank accounts.
Victims of the SARS refund fraud have reported cases where their legitimate bank details were replaced, leading to their tax refunds being stolen.
Dozens of people have contacted authorities about refund losses over the past month. Many discovered the issue only after reaching out to SARS.
One of the first victims to highlight the scam was 68-year-old Jairaj Sathdav. He lost R37,000 ($2,027) after SARS mistakenly deposited his refund into a fraudulent TymeBank account.
TymeBank’s head of operational risk and fraud, George Wandsella, confirmed that Sathdav reported the matter. The bank provided him with documentation to take to SARS.
However, like many others, he has struggled to recover his money.
Victims face financial hardship and dead-end investigations
Gauteng resident Keneuoe Sihlongonyane is another victim who was promised R35,000 ($1,917) in tax refunds, only to find out that it had been sent to an unknown Capitec account.
According to IOL, when she approached SARS for help, she was informed that she now owed the tax agency R39,000 ($2,136) instead.
“The last SMS I got was this morning, telling me to settle the amount immediately or arrange a payment plan,” she said. “I am already struggling financially, and now I am being told to pay for something I never received.”
Kimberley resident Boikanyo Mathobela also had a similar experience when R7,500 owed to him by SARS was deposited into a fraudulent TymeBank account.
He correctly filed the affidavit and reported the fraud to officials but he has not received any updates.
Many victims believe the scam is linked to an insider operation. They had submitted their correct banking details directly to SARS, only for them to be altered before payouts were processed.
SARS and banks respond amid growing concerns
SARS spokesperson Siphithi Sibeko said the agency is investigating several cases. He denied allegations that SARS itself is involved in fraudulent activities.
He reiterated that SARS runs one of the most efficient tax systems in the country. However, he acknowledged that fraudsters have found loopholes to exploit.
Meanwhile, TymeBank admitted that some fraudulent accounts were opened without biometric verification. The bank says this security risk is part of an effort to promote financial inclusion.
While banks like Capitec and TymeBank require victims to report fraud before they can access details about suspicious accounts, many taxpayers have found the process frustrating. They consider it ineffective.
As the investigation continues, affected taxpayers are calling for a crackdown on the syndicates behind these crimes. They are also demanding stronger fraud detection measures from both SARS and financial institutions.
