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Tax Fraud: SARS Crack Down (Again)

“There is no kind of dishonesty into which otherwise good people more easily and frequently fall than that of defrauding the government” (Benjamin Franklin)

The High Court has once again given notice that it will show no mercy to tax cheats and other “white-collar” criminals.

The crime

An accountant had been convicted by a Regional Court of 20 counts of fraud against SARS, involving registration of companies with false information and the generation and submission of false invoices and VAT returns.  As a result SARS lost R425,843-33 in unwarranted VAT refunds before detecting the crime. 

The sentence

The Regional Court sentenced the accountant to a wholly-suspended term of 7 years’ imprisonment.  His subsequent appeal to the High Court against his conviction went disastrously wrong for him – not only was his conviction confirmed, but the Court stiffened his sentence by making 3 years of the sentence effective (with the other 4 still suspended conditionally).

A wholly-suspended sentence was, held the Court, “excessively lenient”.  “Our society, where fraud and corruption are rife, expects harsher treatment in cases like [this one]”.  Not only was the appellant an accountant and therefore “in a position of trust”, but his scheme had required careful planning and execution and had been perpetrated on a sustained and continuous basis.

NOTE FOR ATTORNEYS:  The judgment in Joubert v S (A410/11) [2012] ZAGPPHC 5 is available on the Saflii website

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