More than 100 law firms probed for fraud
Publish date: 24 March 2025
Issue Number: 1118
Diary: IBA Legalbrief Africa
Category: South Africa
The Special Investigating Unit (SIU) is probing 102 law firms which fraudulently received duplicate payments from the Road Accident Fund (RAF), amounting to more than R340m as of 1 March 2021. A GroundUp report says these firms – as well as sheriffs who allegedly enabled the duplicate payments – form part of the SIU’s investigations. Updating Parliament’s Standing Committee on Public Accounts (Scopa) on findings thus far, SIU head Andy Mothibi explained that the RAF made payments 180 days after a successful claim was finalised by way of settlement or court order. Attorneys would then file a writ of execution against the RAF bank account, which would be served by the sheriff. This would cause the RAF’s bank to effect payment at the end of the 180-day period. Because the same claim would have already been loaded on the RAF system, it would be paid again after the 180-day period. The sheriffs, said Mothibi, would also benefit from funds received when executing the writs on behalf of the instructing attorney. He said ‘several legal practitioners’ had co-operated with the SIU and signed acknowledgments of debt amounting to R71m so far. The SIU Cvil Litigation Unit is considering legal action against law firms that have failed to pay their acknowledgements of debt, said Mothibi.
Mothibi told MPs that almost R318m of the R340m in duplicate payments had been recovered from law firms so far. However, notes the GroundUp report, some firms had repaid the RAF out of their trust accounts. Mothibi said that as a result, the SIU has referred evidence against 12 law firms to the National Prosecuting Authority. He said some attorneys who received duplicate payments had been struck off the roll, while others had since been suspended or died. The SIU is also working with the Legal Practitice Council (LPC) to recover monies from these attorneys. The SIU has also referred evidence of misappropriation of trust funds by law firms or practitioners to the LPC to ‘take appropriate action’.
