Pretoria: The South African Revenue Service (SARS) is collaborating with other law enforcement agencies to tackle the illicit fuel trade, which results in a loss of approximately R3.6 billion annually for the government. In the last four months, the National Joint Operational and Intelligence Structure (NATJOINTS) has conducted several operations in this regard.
According to South African Government News Agency, a joint intelligence team consisting of SARS and South African Police Service (SAPS) officials has pinpointed 23 targets in Gauteng, Mpumalanga, and KwaZulu-Natal. Thirteen criminal cases have been filed with SAPS, supported by SARS trade investigators, focusing on customs and excise violations and fraud. These intelligence-driven enforcement actions included search-and-seizure operations aimed at specific fuel storage facilities and depots, along with random sampling of tanker transports to analyze fuel viscosity and composition.
Over the past decade, regions along the Maputo Corridor, which includes South Africa, Eswatini, and Mozambique, have been major targets for the illicit fuel trade. This illegal activity is orchestrated by organized criminal networks that smuggle and adulterate fuel. SARS has discovered cases where importers declare significantly less fuel than what is actually imported, a practice known as under-declaration, involving falsified documents to continue these fraudulent activities.
Fuel adulteration, particularly through the illegal mixing of diesel with paraffin, is a significant issue. As per statistics from the International Trade Administration Commission, this activity costs the government approximately R3.6 billion annually. In response, government agencies are intensifying efforts to detect, prevent, and combat fuel adulteration, enforcing the Customs and Excise Act more rigorously.
SARS highlighted the global nature of the illicit economy, which poses threats to South Africa’s society, economy, and national security. The pervasive activities of tax evasion, smuggling, illegal transactions, illicit manufacturing, and fraud undermine the rule of law and erode public trust. These activities distort markets, deprive governments of revenue, and foster corruption and organized crime.
SARS Commissioner Edward Kieswetter expressed gratitude towards the SARS and SAPS teams, as well as other government departments, for their relentless efforts in addressing the illicit economy. He emphasized that criminal syndicates, emboldened by their gains, underestimate the government’s resolve to eradicate such criminality. Kieswetter affirmed that state agencies will collaborate within legal frameworks to confront illicit trade.
The joint intelligence team also uncovered 953,515 litres of contaminated diesel fuel and identified six fuel depots in violation of Sec. 37 of the Customs and Excise Act 91 of 1964. Assets and contaminated fuel worth R367,274,330 were seized, leading to further investigations and potential criminal and civil liabilities. Additionally, two fuel ‘washrooms’, including a rare mobile version, and twelve fuel transport trucks with suspected false declarations were identified.