The Fraud Files

[adrianh]

This tread is dedicated to stories of people defrauding / cheating / stealing or making really serious mistakes in business.

Please remember that this is a place to post stories - it is not a place to rant, soap box or have bun fights over your perspective.

Just tell the story!

[adrianh]

We used to pay one employee to build stuff at home. It became apparent after a while that he would bring the same product back multiple times. The problem was that he was building at work and at home so it was difficult to trace the exact origin of each product (yes our systems were terrible)

[Blurock]

We have won a reward as exporter of the year a while back, but the success story actually started with a serious mistake in not having the correct documentation for cross border freight. The buyers ended up having to pay Vat and held us accountable for the R300k added to their purchase, which should have been Vat exempted as an export.

This was because we were a start up business with limited funds and we thought we could do all the paperwork ourselves. We were given the wrong advice regarding the SADC Certificate of origin (by the IDC export division) and did not use a shipping agent for the transaction. It all worked out well in the end, but was a daunting experience at the time.

Bottom line is; do not try to be clever and take "shortcuts" Let the experts handle the stuff that they are trained for.

[Blurock]

Corporation (or Big Business) are more than money making machines. They are societal citizens that also have certain legal, economic and ethical obligations. From tobacco to opioids, asbestos to emissions of sulphur and carbon dioxide, they have a special responsibility to society to inform and to protect.
However, the truth is hazardous waste, excessive corporate remuneration, misleading and fraudulent information and just plain corporate misconduct.

Consider the following:
Volkswagen - fabricated the emission results of their diesel vehicles.

Phillip Morris - destroyed research showing the lethal nature of smoking while increasing the addictiveness of their cigarettes.

Exxon Mobil- suppressed the science showing the dangers of climate change and funded climate deniers. Also the biggest oil spill in the world.

Johns Manville - knowledge and denial of the dangers of asbestos.

Facebook - selling personal information without people's consent

Steinhoff - inflated its profits and assets by R250 billion

Tongaat Hulett - 2018 financial results has been overstated by between R3.5 billion to R4.5 billion. Its property portfolio was also inflated.

Gupta companies - Involved in Sate Capture. Astina project, Escom, Mines etc etc Do I have to say more?

KPMG - allegedly aware of suspect flows from Gupta business accounts, and also restated cost related to a family wedding as an unspecified tax-deductible.
Also, KPMG was forced to withdraw a report it compiled in 2015 that found that SARS had a "rogue spy unit"

McKinsey & Company - worked alongside Gupta-linked firm Trillian Capital Partners on an Eskom contract. It had made “several errors of judgement” while working for Eskom and repaid almost R1 billion in fees to Eskom.

German software giant SAP - admitted in 2018 that it paid R128.6 million to companies linked to the Gupta family to get contracts with Eskom and Transnet.

ESKOM - load shedding giant. Overpaying for coal, and receiving poor quality coal - linked to a contract with the formerly Gupta-own Tegeta mine - sub-contractors have also been accused of corruption during the construction of the Kusile and Medupi power stations.

Sharemax - An estimated 40,000 people, mostly retirees invested in the property syndication company - pouring in about R5 billion into Sharemax's schemes.

EOH - Law firm ENS tasked to investigate R1.2 billion in suspect transactions, primarily in EOH’s dealings with the public sector.

Construction Companies - Collusion on World Cup stadium projects have added R14-billion to costs borne mainly by municipalities. 15 Construction companies agreed to pay fines totalling R1.4bn for collusive tendering, including WBHO, Aveng, Murray & Roberts, Group Five, Basil Read, Raubex and Stefanutti Stocks.

Bosassa - Accused of widespread corruption and undue influence with the state. Estimated R12 billion government tenders received between 2003 and 2018.

Gold Fiields - Had hugely increased ANC Chairperson Baleka Mbete's cut in a contentious empowerment deal in response to an alleged threat by her representative. Mbete is believed to receive R25 million in shares from the deal.

Sasol - Its share price lost a third of its value in 2019 as investors react to the delays and cost overruns at Sasol’s Lake Charles Chemicals Project (LCCP) in the US. An independent investigation into the LCCP found inappropriate conduct and incompetence in the LCCP project management team.

MMM - Run from Russia, the pyramid scheme collapsed in 2016 when users failed to feed the bottom of the pyramid.

ANN7, Multichoice, SABC and The New Age - in 2017, SABC was involved in a series of questionable transactions with the Gupta-owned The New Age newspaper, ANN7 and Multichoice. The #GuptaLeaks emails revealed that MultiChoice made questionable payments to discontinued news channel ANN7.

There are a multitude of similar cases and although some amounts may be smaller it shows the nature of the corporate culture, not only here, but world wide. The greed and self indulgence, driven by big egos is very clear for everyone to see.

[adrianh]

You can add all the arms manufacturers that were involved in the Zuma arms deal - Not only did they bribe their way into making the the deal, they also sold us inappropriate equipment at vastly inflated prices.

Hitachi was also involved in the ESKOM newly failed power stations - I can't remember if it was just bribes or bribes and over-priced inappropriate equipment.

I wonder if we got our money back for all the Johnson and Johnson vaccines that had to be discarded worldwide due to contamination (I think it was at the Baltimore facility)

I am told the new 51% owner of SAA is above board - time will tell....

[adrianh]

Not to mention Ford and the whole Pinto saga and Ford / Firestone and the easily rolled American Pickups.

[Blurock]

South Africa is expected to expel more than 200 diplomats from more than 10 countries for abusing their diplomatic privileges by buying duty-free alcohol and then selling it at a profit in the country. This cost South Africa about R100 million per month.

Government has already expelled 17 diplomats from Lesotho and Malawi after they were declared persona non grata following an investigation by the department of international relations and cooperation (Dirco).

from News 24