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Johannesburg – Millions of rands stolen in tax refunds may have been used to fund international terrorism, according to a report in the Sunday Times.
Authorities are reportedly investigating how “numerous” Pakistanis have cloned SA firms through the Companies and Intellectual Property Registration Office (Cipro) in order to steal R144m in tax refunds from the SA Revenue Service (Sars).
According to a forensic report, commissioned by the Department of Trade and Industry, the Pakistanis relied on corrupt officials within Cipro.
A Pakistani now in custody in Gauteng, Aliraza Siyed Naqvi, is suspected of involvement in the "cloning" of legitimate companies, including Sun Microsystems, in a scheme to steal R144m in tax refunds from Sars, the Sunday Times reported.
Shortcomings in the Cipro system made it possible for fraudsters to register company names which are almost identical to those of existing legitimate companies, Fin24.com reported earlier.
Payments intended for the legitimate company were then diverted to false bank accounts.
Last year, tax refunds to a number of companies, including Sun Microsystems and SBC International Management, were diverted to cloned companies in this way,
Five Cipro officials were suspended and 65 000 companies have been deregistered as a result.
One of the problems highlighted by Sake24.com was that many directors were registering under false identities.
In some cases the registered details of directors, too, have been changed, making it possible for perpetrators to open new bank accounts.
The DTI report said the Pakistanis involved used fake South African identity documents from the Department of Home Affairs, the Sunday Times reported.
A possible link between Naqvi and groups involved in sectarian violence in Pakistan has been identified through his brother, Asad Abbas Naqvi, who was murdered in South Africa in December 2008, the newspaper said.
A man of the same name is listed as "a very dangerous terrorist" by authorities in the Pakistani province of Punjab.
Apart from the crisis with cloned companies, Cipro's IT problems have also been causing major frustration for customers since December 2009.
Any enterprise wanting to do business in the formal economy has to register with Cipro before bank accounts can be opened or tax numbers and import permits obtained.
But many users have been unable to use Cipro’s website to register close corporations or companies or submit annual returns because of technical problems.
Cipro's chief IT officer, Michael Twum-Darko, was put on special leave following allegations of fraud in an IT contract with ValorIT worth R153m.
- Fin24.com
