ZAAKIR MOHAMED | How companies can help fight mushrooming crime cartels

It seems like you can hardly open a South African news website these days without finding out about some or other new criminal syndicate. They have infiltrated almost every sector of the South African economy, from mining, to construction, and transport. It is also becoming apparent that many of these syndicates have international reach. 

Those syndicates have a massively detrimental impact on the South African economy too. Illegal miners alone are estimated to cost that sector R7bn a year. That is to say nothing of the costs to the environment (through poaching syndicates, for example) and human life (according to the Institute For Security Studies, organised crime has played a significant role in SA’s increased murder rate in recent years).

On the face of it then, it would seem that SA faces an uphill battle when it comes to tackling organised crime syndicates. Winning that battle will take active participation from a broad cross-section of society, including big corporates. 

In order to understand how South African corporates can help in the fight against organised crime syndicates, it is important to first look at how those syndicates infiltrate businesses in the first place. 

While there have been instances of big corporates participating directly in fraud and corruption, as was revealed during the State Capture Commission, organised crime syndicates typically take a less direct approach when it comes to infiltrating organisations. One of the most common ways is to use companies as  conduits for money laundering.

That is typically where large financial institutions and other businesses come into play. One way they could do so is by infiltrating a business, usually through one or more existing employees.

In order to avoid those kinds of scenarios, it is vital that organisations set a culture of zero tolerance for fraudulent conduct from the top down. Your senior managers and directors, therefore, don’t just have to act ethically, they also have to be seen to do so. 

It is also imperative that any incident of fraud, no matter how small, not be swept under the carpet. No matter how junior or senior an employee is, they should know that if fraud is uncovered, it will be investigated and prosecuted. 

At the same time, you also need to create a culture of active whistleblowing within the organisation so that employees feel comfortable and safe raising issues. There have been far too many instances where South African whistleblowers have been left to hang out to dry by both the state and their employer for doing something that we all should do in the face of fraud and corruption. In the most extreme instances, this can leave them having to flee the country or face being killed (as happened to former Gauteng provincial department of health worker Babita Deokaran). 

That does not just mean not shunning an employee who acts as a whistleblower either. Organisations must take active steps to protect whistleblowing employees from any threats and dangers they might face. After all, if an employee has been put under duress by a crime syndicate and comes forward, they are actively protecting the organisation. It also makes it much easier for the organisation to proactively manage the crisis than if the employee did not feel satisfied and went to the media instead. 

Another proactive step organisations can take is to conduct regular lifestyle audits on employees and ensure that it knows what red flags to look out for. Taking that kind of action is especially important right now, at a time of economic difficulty, when the temptation to take financial assistance is higher than it otherwise might be. Of course, if you see an employee suddenly driving a car they could not possibly afford on their salary, it does not necessarily mean they are engaged in fraudulent activities but it is still a red flag worth keeping an eye on.

Ultimately, South African corporates cannot afford to simply sit back and hope that authorities will eventually deal with the organised crime syndicates that represent such an existential threat to the economy. Organisations will increase their mitigation measures against this threat the more difficult they make it for those crime syndicates to infiltrate their organisations and the more protection they provide to people who blow the whistle on any infiltration attempts. 

This is not a problem with any single solution. But because corporates represent such an important conduit, any efforts they make at breaking the back of organised crime syndicates will be vital. 

• Zaakir Mohamed. Partner: Head of Corporate Investigations & Forensics at CMS South Africa