Pretoria - In refusing bail for an alleged mastermind in a multimillion VAT fraud case, a judge said “looting is the greatest question mark on the capacity to lead South Africa, hovering over the current leadership of the State, and requires resolute attention”.
These words followed the appeal by accused Faried van der Schyff to the Western Cape High Court, after the lower court had refused him bail.
But Judge Daniel Thulare, on appeal, said the magistrate was correct in refusing bail. He found that Van der Schyff, who is facing trial on a string of charges along with eight other accused, was not frank with the court during his bail application.
He, among others, omitted to mention that he had a previous conviction which is fraud related, and that there are other similar charges pending against him in another case.
While it is claimed that Van der Schyff and his co-accused plundered State coffers of more than R46 million in alleged false VAT claims, he pleaded innocence and said he knew nothing about this.
Judge Thulare, in refusing bail, remarked: “The clarion call from our nation is clear, let them warm up in yellow overalls awaiting trial and after a fair trial, if convicted, be in orange overalls in prison where they belong.”
The judge said it seems to him that, with the prevalence of these cases by private individuals and juristic entities, that for some, VAT fraud is a thriving multimillion business.
“The time has arrived for the State to have a focused intelligence and inspectorate unit either within Sars or within the greater State security cluster dedicated to save the Republic’s money from local and foreign fraud and money laundering vultures.
“Our guardians must guard our money. It is the responsibility of the judiciary, the conscience of this nation, to draw a line for those who demonstrate the likelihood that their release back into society on bail will endanger the safety of our fiscus and members of society,” Judge Thulare said.
The State opposed the appeal and said there was the likelihood that Van der Schyff would endanger the safety of the fiscus if he was granted bail.
The SA Revenue Service (Sars) identified linked corporate entities registered as tax vendors that claimed VAT refunds, which could not be substantiated.
The entities were managed as car dealerships or businesses in the property or building industry. They allegedly submitted false information via the e-filing system, initially on VAT returns and subsequently on substantiating documentation.
It is claimed that as a result of the scheme Sars faced potential prejudice of R219 352 743. Sars paid out some of the refunds claimed and suffered an actual loss of R46 651 794.
Van der Schyff and his co-accused faced 711 charges as a result.
It presented evidence that, while in custody at the Pollsmoor Correctional Facility, he was found in possession of a cellphone in his cell. When it was confiscated, he was allegedly again found with a cellphone in his cell hidden in his towel. The State feared this could be used to transfer more funds from accounts and posed a security risk.
Van der Schyff testified that he was self-employed, providing a bookkeeping service that assisted clients with their VAT claims.
He said he was not aware of what was happening in his business since his arrest and he said the charges against him were speculative.
Asked why he did not disclose his earlier fraud conviction, he at first denied it and later said he was forced into pleading guilty.
Judge Thulare said he had shown “an utter disregard for the law”.
“It did not weigh on his mind that he had a previous conviction for fraud. He had a pending case for tax and did not qualify to practise as a tax practitioner. Sars told him that he could not practise as a tax practitioner. He was aware that providing services without being registered constituted a criminal offence on its own.”
The judge further said that “the biggest problem with the appellant is that he overrated his intelligence and his being clever has become his own liability and downfall”.
He found that it was not in the interests of justice to grant him bail.
Pretoria News