The Road Accident Fund (RAF) has suspended four top executives — including acting CEO Phathutshedzo Lukhwareni, chief financial officer Bernice Potgieter, and chief governance officer Mampe Kumalo — amid mounting scrutiny over the fund’s financial management and governance practices.
The board confirmed that the suspensions, which took immediate effect, are precautionary and not findings of guilt. The RAF said the move is intended to “ensure the integrity and transparency of the investigative process” and to safeguard public trust.
The decision follows explosive testimony before Parliament by former senior RAF manager Ian Barriel, who outlined a troubling pattern of executive interference, financial mismanagement, and internal victimisation.
Collapse in Governance and Misconduct Allegations
Barriel testified that RAF executives often instructed disciplinary action against staff without due process and ignored recommendations for reinstatement, leaving employees suspended for years — a direct violation of the fund’s own six-month policy limit.
He also revealed how external lawyers were paid to run internal hearings, dramatically increasing costs, while the RAF spent public funds on protracted legal battles against staff who had already won cases in court.
Parliament heard that under the leadership of former CEO Collins Letsoalo, the fund created “specialist adviser” roles and approved questionable secondments, bypassing recruitment norms.
Financial Manipulation and Hidden Liabilities
Former RAF actuary Itayi Charakupa warned MPs that if all outstanding claims were processed, the fund would “run out of cash almost immediately.” He explained how RAF switched to an unsanctioned accounting framework, Ipsas 42, reducing stated liabilities from R330 billion to just R27 billion — effectively hiding billions in unpaid claims.
The Auditor-General slammed the move, calling it “not suitable for our schemes” and warning that the RAF was excluding accident-related liabilities from its balance sheet.
In 2022/23, the RAF received a disclaimer of audit opinion due to these irregularities, with estimated liabilities now exceeding R500 billion.
Lavish Spending and Questionable Contracts
Beyond the accounting chaos, Parliament uncovered shocking procurement excesses.
Two marketing contracts — one with Media Mix 360 and another with Dzinga Productions — were priced at R500 million each over five years, with one year alone seeing R161 million paid to Media Mix 360, exceeding the RAF’s own budget by 60%.
Invoices revealed bucket hats billed at R11,500 each and branded water bottles costing R85. Even RAF spokesperson McIntosh Polela admitted the numbers “seem exorbitant.”
Meanwhile, former CEO Collins Letsoalo’s security budget ballooned from an annual R480,000 to R150,000 per month, covering hotel stays and a hired BMW 5 Series for his bodyguards.
Calls for Accountability
Parliament’s Standing Committee on Public Accounts (Scopa) has demanded answers from the RAF leadership. Committee chairperson Songezo Zibi vowed to push for stronger action against the agency’s leadership, saying the probe “reveals a public institution that has lost its moral and operational compass.”
Despite the scandals, the RAF board insists that operations continue smoothly and that it remains “committed to corporate governance, accountability, and the highest ethical standards.”
