Fraud appeal backfires on VAT claims accused

A Nelspruit accountant convicted and sentenced for fraud got more than he had bargained for when the Pretoria High Court lifted the suspension of his sentence and sent him to jail for three years.

The Nelspruit Regional Court sentenced Francois Joubert, 36, to seven years for defrauding SARS of R424843.33 in 2008.

He was convicted on 20 counts of fraud and his sentence was suspended for five years. Joubert was ordered to repay the money on or before September 30 2010.

Joubert appealed against the conviction and sentence in the Pretoria High Court in 2009 and on Friday got the shocking news.

The high court found that Joubert was the brains in a scheme to defraud SARS.

The scheme involved companies unlawfully claiming VAT refunds from SARS.

Payments from SARS into the accounts of Micromatica, Red Barracuda Trading, Global Pact Trading 41, Assagurl cc, Lekuzz cc and Bablemi were made between September 2003 and April 2004.

Judge James Goodey said the magistrate who convicted Joubert had carefully analysed the evidence, observed the witnesses and applied the law with care.

He said the evidence against Joubert was undisputed.

Goodey said Joubert confirmed his guilt by refusing to testify, the state proved the charges beyond a reasonable doubt and the convictions were justified and should be confirmed.

But Goodey said the sentence imposed by the magistrate was excessively lenient. He said it amounted to a loan repayment.

"The sentence imposed in effect boils down to the following: the appellant helped himself to a 'loan' of almost R500 000 at prime interest rate. He does not have to go to prison, neither has he to pay a fine.

"He only has to repay the 'loan' at prime interest rate. The only punishment is a 'sword' of a possible term [if he does not repay the 'loan'] of seven years' imprisonment.

"Our society, where fraud and corruption are rife, expects harsher treatment in cases like [this]".

He said Joubert had abused his position of trust.

"The offences display a single intent to defraud SARS, but perpetrated on a sustained and continuous basis," said Goodey.

He ordered that the convictions be confirmed. The sentence imposed by the magistrate was set aside and replaced.

"The accused is sentenced to seven years' imprisonment, of which four years are suspended for five years on condition that, during the period of suspension, the appellant is not convicted of fraud or theft."

SARS spokesman Adrian Lackay welcomed the judgment.

"This will send a signal to other accountants and taxpayers that crimes against SARS are viewed by the courts as serious offences."

He said that, in the 2010-2011 financial year, 332 fraud cases and 52 of corruption were pursued. About 238 people were convicted and SARS recovered R23-million.

Joubert plans to appeal.

Joubert's lawyer, Johann de Necker, said: "Of course we are going to appeal. An application for leave to appeal will be submitted on Wednesday."