A 46-year-old Durban man has been arrested by the Hawks in connection with an alleged customs fraud scheme that authorities say could have cost the South African Revenue Service (SARS) nearly R37 million in unpaid customs duties and value-added tax (VAT).
The Directorate for Priority Crime Investigation (Hawks) confirmed that Butholezwe Prosper Mhlanga was arrested on Monday by members of the Durban Serious Commercial Crime Investigation unit.
Alleged false declaration
According to the Hawks, the case stems from an import declaration submitted in 2021.
Investigators allege that Mhlanga declared a shipping container as carrying clear Sellotape and plastic cups when completing customs documentation for SARS.
“It is alleged that in 2021, Mhlanga made a false declaration of goods to SARS declaring a container to contain clear Sellotape and cups,” the Hawks said.
Based on the submitted declaration, SARS processed the shipment for customs purposes.
Cigarettes allegedly discovered
Authorities said a subsequent inspection of the container revealed a significantly different cargo.
Instead of the declared goods, officials allegedly discovered various brands of illicit cigarettes concealed inside the shipment.
The Hawks said the false declaration resulted in a substantial potential loss to the state.
“This led to a potential loss of Customs Duty and Value Added Tax (VAT) valued at R36,965,454.05,” the Hawks said.
Court appearance
Following the discovery, a fraud case was initially registered at Durban Central Police Station before being transferred to the Hawks for further investigation.
Mhlanga appeared briefly before the Durban Magistrate’s Court on Monday.
The court granted him bail of R20,000, and the matter has been postponed until 4 September to allow investigators to continue their probe.
Investigation continues
The Hawks have not indicated whether additional suspects could be arrested as the investigation progresses.
The case forms part of ongoing efforts by South African law enforcement agencies to combat customs fraud, illicit tobacco trading and tax evasion, which continue to cost the country billions of rand in lost revenue each year.
As the matter remains before the courts, Mhlanga is presumed innocent unless and until proven guilty.
