Former SARS employee sentenced to six years for tax fraud

Former SARS employee and registered tax practitioner, Michael Benson, has been sentenced to an effective six years behind bars for fraud, forgery, uttering and failing to keep proper records. 

The Bellville Regional Court convicted Benson on 11 counts of fraud for submission of false VAT201 returns and claiming undue Value Added Tax (VAT) refunds, 27 counts of fraud for submission of false documents to SARS to justify the false VAT claims, 24 counts of forgery, 24 counts of uttering and a count of failing to keep proper records.

State Adv Wimpie Els of the Specialist Tax Unit led evidence which revealed that over a period of 25 months, Benson submitted eleven fraudulent VAT201 returns to SARS, claiming refunds based on wholly fabricated information. After being requested to provide substantiating documentation, he committed further fraud by producing forged invoices, bank statements, and municipal contracts, thereby committing further offences of forgery and uttering.

NPA spokesperson Eric Ntabazalila said Benson previously worked as a VAT auditor and compliance officer at SARS (1997–2000) and was a qualified and registered tax practitioner (SARS and SA Auditors Board) during the period of the commission of the offences. At all material times relevant to the charges, the accused was a tax practitioner. During this period, the accused submitted false VAT210 returns to SARS, fraudulently claiming an amount of R1.7 million. Pursuant to these misrepresentations, SARS effected payment of R1.58 million into the accused’s bank account. SARS blocked the final claim upon discovering the fraudulent claims the accused submitted.

On being requested by SARS auditors to furnish substantiating documentation for the aforesaid claims, Benson fraudulently produced forged tax invoices purporting to justify the VAT refunds received. 

"It should further be noted that the accused was previously employed by SARS in the capacity of an auditor from 1997 until 2000, during which time his duties included conducting audits on individual and corporate taxpayers to ensure compliance with tax legislation.

“Adv Els argued that Benson did not voluntarily desist from his unlawful conduct. This occurred solely due to the SARS intervention. Even after detection and a formal request to provide proof of the claimed amounts, he persisted in his fraudulent scheme. He has made no restitution to SARS following the discovery of the offences. His conduct was deliberate, premeditated, and executed with meticulous planning,” Ntabazalila said. 

Despite his subsequent plea for leniency, the court found that he acted with knowledge and intent and therefore bears full responsibility for his conduct. 

The court also declared Benson unfit to possess a firearm in terms of section 103 (1)(g) of the Firearms Control Act 60 of 2000. It authorised a warrant for search and seizure for all competency certificates, licences, authorisations and permits issued to the accused in terms of Section 103(4) of the Firearms Control Act 60 of 2000, all firearms in possession of the accused and all ammunition in the accused’s possession.

The NPA welcomed the conviction and sentencing saying it sent a message that the NPA will not tolerate fraud, abuse of public trust, or the manipulation of tax systems for personal gain. 

Cape Times