MY DUTY AS A DIRECTOR/ MANAGER TO REPORT CORRUPT TRANSACTIONS

Amalta Seevnarayan Dhanee | Legal Advisor

The alarming rise in crime across South Africa has fundamentally altered our daily lives. Simple activities like parking at a shopping mall or picking up children from school now come with heightened risks of hijackings, kidnappings, and other criminal acts. While individuals grapple with this new reality, professionals in positions of authority face their own set of challenges, particularly when encountering fraudulent activities in the workplace.

Are you aware of your statutory obligation to report certain offences or suspected offences under section 34(1) of the Prevention and Combatting of Corrupt Activities Act 12 of 2004 (PRECCA)? If not, this article is essential reading for you. It requires any person in a position of authority who has knowledge or suspicion of such an offence to report the matter to the South African Police Services.

What offences have to be reported ?

Any one of the following offences in excess of R100 000.00 must be reported in terms of section 34 (1) of PRECCA to a police official in the Directorate for Priority Crime Investigation (DCPI / HAWKS):

  • Corruption – Any person who gives or agrees or offers to give or accept any gratification amounting to an unauthorized or improper inducement to act or not to act in a particular manner;
  • Offences under Section 20 and 21 of the Act;
    • Theft – The unlawful and intentional appropriation of another’s corporeal property;
    • Fraud – The unlawful and intentional making of a misrepresentation which causes actual prejudice, or which is potentially prejudicial to another;
    • Extortion – The taking from another some patrimonial or non-patrimonial advantage by intentionally and unlawfully subjecting that person to pressure which induces him or her to submit to the taking;
    • Forgery – Unlawfully making a false document with intent to defraud, to the actual or potential prejudice of another;
    • Uttering of a forged document – Unlawfully offering, passing off or communicating a forged document with the intent to defraud, to the actual or potential prejudice of another.

What criteria must be considered for reporting?

There are no hard and fast criteria or set rules which must be utilized to decide whether reporting is necessary in a particular incident.

The first point of screening would be to determine whether the R100 000.00 threshold has been met. Once that has been established the next question to be answered would be whether there has been a corrupt activity or a common law offence.

In considering this question, there must be reasonable suspicion with regard to such conduct which must be supported by evidence.

If the facts before you are inconclusive or if there is doubt on whether the evidence meets the threshold to report, the prudent approach would be to report the corrupt transaction in order to discharge your duty in terms of PRECCA. The onus would then shift to the authorities on whether to prosecute or proceed further with the matter. 

In conclusion, understanding and fulfilling your statutory obligations under PRECCA is crucial for maintaining integrity and trust within your organization. By reporting suspected offences, you not only comply with legal requirements but also contribute to a safer and more transparent business environment. Remember, the responsibility to act lies with you, and failure to report can have serious consequences. Stay informed, stay vigilant, and ensure that your actions uphold the highest standards of ethical conduct. For more detailed guidance, refer to the reporting guide available on the Directorate for Priority Crime Investigation (DCPI / HAWKS) website.