JOHANNESBURG - The South African Revenue Service (SARS) has been hit by a new CIPRO based scam. Earlier this year a number of companies had their directors fraudulent replaced at the Companies and Intellectual Property Office (CIPRO), new bank accounts were opened, and tax refunds from SARS were diverted.
It is not yet clear how many companies have been affected, nor the total sum of money that has been lost.
Among the companies targeted were Gap Distributors, AFC Ltd, Vanern Investments, Nestle Purina Petcare (South Africa), and A Million Up Investments 48. In all these cases the legitimate directors were deregistered and one Itumeleng Malotsa, 23, was inserted as the sole director. A number of companies also had their registered addresses changed. In the case of AFC Molatsa was inserted as a director on May 7 2010 and the company's registered address was changed to No. 1204 Botshabelo, Bloemfontein, 9301.
Business Report reported late last month that Malotsa had earlier been arrested by police investigators working with SARS and released on bail. Investigations are apparently ongoing.
In one of these incidents the fraudsters successfully switched the banking details at SARS of a company and a considerable sum of money due in tax refunds was stolen. In another case banking details were switched - using a fraudulently altered copy of an identity document of an existing director - but it was red-flagged by SARS before the money was paid out.
How the scams work