From churches banking more money than they collect in offerings, to a protection racket at spaza shops and explosives being transported in taxis and buses in bags across borders.
This is the dark web of SA’s organised crime operations, which at times are not detected due to a lack of stringent controls and monitoring of illicit financial flows.
The gaps in law enforcement contributed to SA being put on the greylist by the Financial Action Task Force for increased monitoring recently.
According to academic and crime experts who spoke to Sowetan, organised crime syndicates have been operating with impunity in the country.
IRS Forensic Investigations financial crime investigator Chad Thomas said some churches had been created to form a conduit for money laundering.
“One of the biggest West African advanced fee syndicates has established churches throughout SA. These churches don’t necessarily have to report their collection money. They establish other churches throughout the world for purported “missionary” purposes and transfer money supposedly derived from the South African congregants to these other branches in other countries. The funds are not used for missionary purposes but for other completely unrelated uses.
“Funds that are obtained in an illicit manner, for example drug dealing, are mixed with money obtained from congregants. A church may well have only 20 congregants but the money the church generates through this scheme would appear as if there were hundreds or even thousands of congregants,” said Thomas.
“There would be a church with 10-20 legitimate congregants and if you had to go through their bank accounts on a Monday morning after a Sunday service, it is a lot of money and there is no way that money was derived from the congregants of the church. The extra money comes from illicit means such as drug smuggling or vehicle theft syndicates, or other crimes.
“The church is merely a front set up as a means to clean the money by inflating the number of congregants than there really are. Some churches are definitely being used for money laundering, along with other businesses such as restaurants, guest houses, clothing boutiques, and car dealerships.
''Because the church is registered as such with the bank, the bank does not find the cash deposits and subsequent transfers to other jurisdictions as suspicious, and therefore doesn’t flag it”, added Thomas.
Prof Hussein Solomon from the Centre for Gender and Africa Studies at the University of the Free State said foreign nationals who own spaza shops had become easy targets for extortions.
Solomon has done research about terrorist financing in SA for many years.
In his book, Jihad: A South African Perspective, he unpacks the state of terrorist financing in the country using open sources.
Solomon said during the height of xenophobic violence, in some instances these foreign spaza shop owners did not get protection from police and this opened them up to all sorts of attacks.
“We had some major xenophobic attacks against spaza shop owners of foreign descent. They were not getting any protection from the police because they were foreigners. For example, the Somali spaza shop owners paid protection money to certain extremist groups operating in this country. These groups take this money and move it to Somalia to fight the government there.”
Solomon said the kidnapping of children of wealthy people for ransom was on the rise.
“There is an increase in the kidnapping of children of rich people by Islamic states in SA and holding them for ransom. It started in northern Mozambique and there is a very close connection between the militants there and here in SA. They kidnap children of rich families ... and get the family to pay the ransom, take the ransom out of SA to engage in terror activities elsewhere,” said Solomon.
“They walk over with the cash through the border and set up businesses in SA and another country and move the money through those businesses until it reaches the terrorists.”
Willem Els of the Institute for Security Studies said explosives were smuggled into SA through the Beitbridge border post in Zimbabwe.
Speaking on the smuggling of explosives in the Southern African Development Community region at a conference held under the theme, countering transnational organised crime in Africa, in Randburg, Johannesburg, last week, Els said: “Mainly, women are recruited as couriers using public taxis and buses because they are seen as innocent. Male truck drivers are also targeted to hide the smuggled explosives among the cargo on their trucks. Women also cross the river by boat or on foot and make use of unsuspecting couriers to carry the bags with explosives and accessories,” said Els.
“But it is not limited to these techniques — a driver of a hearse was stopped and R700,000 worth of explosives were found in the hearse after he smuggled them in.”
Els said the explosives were used for ATM bombings, cash-in-transit robberies and illegal mining.
He said there was more than one cash-in-transit heist per day in the country.
Solomon said the country’s police force and state security agency were not capacitated to deal with these syndicates.
“Our intelligence services have been so politicised and used in factional ANC battles that they are not used on these particular crimes. There is the incapacity of the police and we have the wrong people in the wrong positions in our security services. There is a lack of forensic financial accountants to investigate these complex crimes,” said Solomon.
kokam@sowetan.co.za
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