Pretoria - The Hawks will take over investigations into alleged fraudulent acts committed by staff of the Road Accident Fund (RAF).
The DA laid criminal charges against RAF boss Dr Eugene Watson and the board in April following allegations of large-scale fraud.
DA spokesman for transport Chris Hunsinger, in a statement to the police, said the RAF Act did not make provision for the fund to represent the public.
Yet, the RAF was undertaking large public drives – the so-called RAF on the Road Campaign – which amounted to approaching the public directly asking to administer claims on their behalf.
Hunsinger said there was also a practice whereby the RAF sued itself in order to stop the prescription (lapse) of these claims after five years, due to the high number of claims.
“The practice deliberately escalates expenses and hugely inflates the burden to maintain cash flow within the RAF,” he said.
The claims are that the RAF instructed law firms from its own panel of contracted attorneys to issue summons against it.
This was allegedly in a bid to buy time to pay out the claims. This was said to be unethical and constituting fraud as the attorneys were issuing summons in the names of claimants (the public), who had no knowledge of this.
This, the DA said, also resulted in huge additional legal costs for the RAF. According to Hunsinger, a confidential internal audit performed by the RAF showed that there were more than 2 098 such cases.
The chairman of the RAF board, Dr Ntuthuko Bhengu, when confronted with this alleged practice during a radio interview, denied it and said any such cases were isolated incidents.
Hunsinger said evidence showed that claimants were unaware that staff or the RAF instructed their own attorneys to issue summons against the RAF to avoid prescription.
“This meant that claims were settled to the fraudulent benefit of the RAF staff and at the expense of the claimants.”
He said an internal inquiry which was limited to only two financial years, showed the unnecessary legal costs regarding this practice amounted to about R6 million.
But Bhengu said they had noted with dismay the scurrilous nature in which the DA had handled its concerns about the RAF. He said the RAF board was still not in possession of the alleged charge sheet and other information in the DA’s possession despite numerous attempts to obtain them.
“It is unfortunate that the DA failed to make use of the parliamentary processes and law enforcement agencies at its disposal to obtain answers from the RAF regarding its allegations
“Instead, the DA opted to sensationalise the matter, going as far as to lay a formal charge at the Cape Town central police station against the chief executive officer on behalf of road accident victims,” he said.
Bhengu said the RAF was always mindful of its accountability to the public and mandate to road accident victims.
“At no point has the fund ever shied away from addressing any questions and concerns through channels such as the Portfolio Committee of Transport, of which the DA is a full member of.”
He said the board would like to place on record its unequivocal support for Watson, and commended him, his executive committee and all the staff for the sterling work they were doing for crash victims.
He denied the claims made by the DA and added the RAF had never precluded claimants or motor vehicle accident victims from approaching the courts or seeking legal representation as it was their constitutional right to do so.