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Alarming increase in identity fraud in Gauteng

There has been a dramatic surge in identity theft and business fraud in Gauteng with the number of cases under investigation more than doubling between 2012 and 2013, according to private investigations company, Justicia Investigations.

Company director, Conrad van der Merwe, said that the company had investigated no cases of identity theft during 2012. This year, Justicia was taking on between two and three new cases every month – a figure that they expect to continue to grow. One of these investigations led to the arrest of a key member of a syndicate in October.

A two-month long investigation began with an act of kindness. The syndicate used a 'disabled' woman in a wheel chair as bait. She asked passers-by to help out by pushing her a few blocks in the Johannesburg CBD to the flat where she allegedly lived. “When the victim pushed the ‘disabled lady’ to the identified block of flats, this good Samaritan was violently assaulted by her and two male accomplices who robbed her of her handbag, wallet, cellphone and whatever shopping she had done before the incident,” he explained.

“To add insult to injury, the syndicate then took over her identity and whole life! They used the victim’s ID to open fraudulent bank accounts, rent a flat and open clothing accounts at retailers. As a result, the victim had to try to explain to SAPS investigators that she was not the fraudster they were looking for in connection with several cases. She also had to explain to all the stores where accounts were opened that she was not responsible for opening them.”

The result was that her ID number was blacklisted as fraudulent, making it impossible for her to open an account, get credit or sign a lease. “They effectively destroyed her identity and her life – all because she was kind enough to help a seemingly disabled woman,” he said.

It did not stop there. According to van der Merwe, members of the syndicate informed a large marketing company of a change in the banking details of one of their business partners. The new account was the fraudulent account that they had opened using the victim’s ID number. As the fake bank letters looked genuine to the accountant, she changed the banking details on the payment system. At month end, an electronic payment of more than R600 000 was made into the fraudulent account.

A few weeks later, the accountant received a statement indicating that no payment had been received. When she sent through proof of payment, she was horrified to discover that she had paid R600 000 into the wrong account. The bank confirmed that the entire R600 000 had been withdrawn at their Musina branch. This was a crippling blow to the company as they now had to repay the bill and write off R600 000.

Van der Merwe said the arrested syndicate member was found in possession of another six stolen RSA identity documents, four of them with her picture already installed professionally. Further investigation by Justicia revealed that the suspect was a female Zimbabwean national with no passport, no work permit and no legitimate identity document, making a living out of impersonating her victims and abusing their identities.

The Justicia undercover investigator who holds up the scammed identity document for a women who has defrauded several large companies and individuals of hundreds and thousands of rands. We ask anyone who recognises this person to come forward and assist in the identification.

“The suspect was already in the process of ruining the lives of another four South African citizens with her devious activities. She is a phantom who lives like a parasite on one South African ID after another,” he said.

He confirmed that the suspect had been charged and had appeared in court during October. She was deemed a flight risk and denied bail. The case will return to court in November.

Justicia’s ongoing investigations have revealed that, although a proportion of the criminals that are stealing ID documents and using these to commit fraud, are South African, the bulk of the ‘specialists’ are mainly Nigerians and Zimbabweans.

In light of this, he appealed to South Africans to guard their ID documents and not to give out their ID numbers without checking that those requesting it were trustworthy. He also encouraged people not to carry ID books in purses or handbags and never to leave important documents in their cars.

“Justicia Investigations also wants to appeal to all accounting staff of firms not to just accept notice of a change in the banking details of clients without contacting the company in question on a landline (not cellphone) to verify that this is actually happening. Ignorance could cost them dearly,” van der Merwe warned.

Although there are no official, up-to-date statistics to indicate the incidence or the extent of the increase in the number of cases of identity fraud in South Africa, credit bureaux and insurance companies are raising the alarm. They estimate that identity fraud could be costing South Africa more than R1-billion every year.

The SA Fraud Prevention Service, a non-profit organisation that works to combat fraud, identity theft and financial crime, is now receiving up to 25 complaints daily. According to the organisation’s chairman’s report for 2012, the number of fraud filings received by SAFPS increased by 27% year-on-year in 2011, with 14 320 new incidents being reported.

Investigations such as the recent one reported by van der Merwe are expected to continue to climb exponentially.

Globally, identity theft is one of the fastest growing cybercrimes with the number of reported incidents increasing by 13% globally in 2011. According to the Federal Trade Commission, 9.9 million Americans were affected by identity theft last year with 19 people falling victim to identity theft ever minute.

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