SARS Enforcement and Customs Operations for May 2014

Pretoria, 13 June 2014 – The South African Revenue Service (SARS) is providing an update to the media and the public on its operations to combat crimes such as smuggling, fraud and abuse of the tax system for the month of May 2014.
 
The aim is to inform the public about the work SARS’ Customs and Enforcement teams do on a daily basis, to provide an indication of the prevalence of tax and customs-related offences in South Africa, and to illustrate the support SARS provides to other law enforcement agencies.
 
Interventions to combat Fraud and Corruption
SARS will combat any form of corruption, fraud and abuse of the tax system. The following cases can be reported for May 2014:
 
  1. On 16 May, Mr Mario van Wyk (trading as Ultimate Customs and Excise Clearing and Consulting) pleaded guilty in the Johannesburg Regional Court to fraud charges emanating from the submission of false Customs documents and declarations using fraudulently created SARS letterheads during February and March 2010. He was sentenced to a fine of R20 000 or 2 years imprisonment, with another 2 years imprisonment being wholly suspended.
  2. As previously reported, on 22 May the North Gauteng High Court granted SARS a final preservation order in the ongoing civil case against Mr Radovan Krejcir. Preservation orders enable SARS to preserve assets when there are outstanding tax liabilities. More specifically these provisions are applied when there is a real risk of the dissipation of assets or where there is a risk that the taxpayer could dispose of assets or put assets out of the reach of SARS’ collection efforts.
  3. On 26 May, the Cape Town Regional Court sentenced Mr PG Firstbrook to five years imprisonment after he had pleaded guilty to 78 charges, including failure to submit PIT returns, failure to submit VAT 201 returns, VAT fraud to a value of over R475 000 and fraud to the same amount. This case has a long history – in 2000 Mr Firstbrook (trading as 584 Distributors) was deregistered because of his failure to submit VAT and PIT returns. He then proceeded to trade as an individual, using the deregistered VAT number, and charging VAT which he did not remit to SARS.
  4. On 29 May Mr Gerhardus Prinsloo pleaded guilty in the Bloemfontein High Court to 75 counts of fraud, with the loss to the fiscus being over R1.9 million.  Mr Prinsloo had, over the period April 2011 to April 2013, misled 75 farmers into defrauding SARS by declaring livestock transactions as maize, grass and feed sales which do not attract VAT charges. He was sentenced to a fine of R600 000 or 6 years in jail, of which R200 000 or 2 years in jail were wholly suspended.  
 
Customs Interventions
In the period from 1 to 31 May 2014, SARS Customs and Enforcement teams have:
 

1. Prevented over 40.5kg kilos of cocaine (valued at over R11.6 million), over 8.2kg ephedrine / crystal methamphetamine (valued at almost R2.5 million) and 2000 ecstasy tablets (valued at R100 000) from entering the country. In all cases, the drugs seized and the individuals involved were handed over to the SAPS for further action. The drugs were seized in a number of different interventions, and included:

    • 14kg cocaine, valued at over R4 million, carried by a male passenger transiting through Johannesburg from Sao Paulo to Abidjan. The drugs were carried inside steel automotive pistons in his luggage, which had to be cut open with an angle-grinder by the Customs team.
    • 10.6kg cocaine, valued at over R2.9 million, carried by a female passenger transiting through Johannesburg from Sao Paulo to Maputo. The drugs were concealed in handbags and the soles of sandals in her luggage.
       
       
    • Over 8.2kg crystal methamphetamine and ephedrine, valued at over R2.4 million, found in 6 separate seizures, all in parcels sent from India to South Africa. The methods of concealment included children’s books, handbag handles and cotton reels.
       
    • Almost 4.8kg cocaine, valued at over R1.3 million, carried by a female passenger arriving in Johannesburg from Sao Paulo. The drugs were concealed in handbags in her luggage.
    • e. 3.3kg cocaine, valued at over R950 000, concealed in a laptop bag carried by a male passenger arriving in Johannesburg from Sao Paulo
       
    • 3kg cocaine, valued at over R860 000, carried by a male passenger transiting through Johannesburg from Sao Paulo to Maputo. The drugs were concealed in a body wrap carried in his hand luggage – after SARS Detector Dog “Caesar” has reacted positively to the bag.
    • Just over 2kg cocaine, valued at over R590 000, found during a “rummage” search of a flight that had arrived in Johannesburg from Sao Paulo. The drugs were concealed in a laptop bag which had been left under a seat on the flight. The owner of the bag was identified and apprehended before leaving the airport.
    • 2kg cocaine, valued at over R575 000, carried by a female passenger arriving in Johannesburg from Sao Paulo. The drugs had been hidden in the handles and structure of her suitcase. 
       

2. Seized a number of other items coming into the country, including

    • 590 Master Cases of illicit cigarettes (5.9 million individual cigarettes), valued at over R3.8 million), with the brands seized including Pacific Blue, Seville and GT.
    • 156 fraudulent cheques (made out to a total value of over R49 million) in a parcel from Nigeria to South Africa.

3. Prevented a number of items from leaving the country, including:

    • 4 cut Tanzanite stones, in an undeclared parcel from South Africa to Thailand, which were detained for the Diamond Board.
       
 
    • 154kg dried abalone, valued at almost R540 000, found undeclared at a courier warehouse at OR Tambo International, originating from Maputo and destined for Hong Kong.
    • Over 82kg dagga, worth over R115 000, mainly in parcels destined for the United Kingdom. One seizure, of 28kg, was found after SARS Detector Dog “Angel” reacted positively to the parcel.
       
       
       
    •  A 300g ivory statue, valued at R36 000, found at the OR Tambo Mail Centre in a parcel destined for China, and concealed in a tin of baby formula

 

    •  450g ivory, valued at R7 785, found at the OR Tambo Mail Centre in a parcel destined for China, and concealed in a tub of camphor cream