Three people, including a construction company director, his wife, and his brother-in-law, have been arrested in Mpumalanga in connection with an alleged large-scale fraud scheme involving COVID-19 relief funds. The case centres on the Unemployment Insurance Fund (UIF) Temporary Employee Relief Scheme (TERS), with authorities estimating losses of nearly R27 million.
According to the Mpumalanga Hawks, the 48-year-old Malawian-born director—who is also a permanent South African resident—together with his 48-year-old wife and 39-year-old brother-in-law, are accused of orchestrating a fraudulent claims operation involving more than 700 non-existent employees.
The suspects reportedly surrendered themselves to the Hawks following an ongoing investigation into the matter.
Hawks spokesperson Lieutenant Colonel Magonseni Nkosi confirmed that the main suspect, who runs a construction company, is believed to have unlawfully benefited from COVID-19 TERS funds administered by the UIF. The scheme was originally designed to provide financial relief to employees whose income was affected during the pandemic.
However, investigators allege that the company submitted fraudulent claims using false employee records, resulting in an actual loss of approximately R26,943,793.19 to the UIF.
Authorities say the claims included more than 700 “ghost workers,” with some identity details allegedly belonging to former employees of the company. This suggests that personal information may have been reused or manipulated to support the fraudulent applications.
A joint investigation was carried out by multiple law enforcement and regulatory bodies, including the Hawks’ Serious Corruption Investigation unit based in Nelspruit, the Unemployment Insurance Fund (UIF), the Special Investigating Unit (Special Investigating Unit), and the National Prosecuting Authority’s (National Prosecuting Authority) Asset Forfeiture Unit.
Investigators further allege that the fraudulently obtained funds were transferred into several bank accounts linked to the suspects. These included accounts belonging to the company director, his wife, and a business associated with her, as well as accounts tied to the brother-in-law. Authorities believe the money was used for personal enrichment and to acquire both movable and immovable assets.
It is also alleged that the brother-in-law played a key role in recruiting individuals under false promises of employment, contributing to the creation of the fake workforce used in the claims process.
The investigation ultimately led to the arrest of the trio, who are expected to appear before the Middelburg Magistrate’s Court on Monday, May 18, 2026. They face multiple charges, including fraud and money laundering.
Mpumalanga Hawks provincial head Major General Nico Gerber praised the coordinated efforts between agencies, stating that the case demonstrates the effectiveness of joint operations in tackling complex financial crimes.
He added that law enforcement remains committed to holding offenders accountable and recovering proceeds of crime, warning that further arrests and investigations may follow as the case develops.
The matter has drawn public attention due to the scale of the alleged fraud and the exploitation of COVID-19 relief systems intended to support vulnerable workers during the national state of disaster.
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