A House of Cards: Explosive Report Alleges RAF “Cheated the Books” to Hide Insolvency

RAF Hid R326 Billion in Liabilities to Appear Solvent, Whistleblower Alleges

A damning allegation has emerged from within the Road Accident Fund (RAF): a former senior actuarial manager says the fund deliberately manipulated its accounts to appear financially healthy, hiding over R300 billion in liabilities from parliament and the public.

In an affidavit submitted to parliament’s Standing Committee on Public Accounts (SCO­PA), former manager Itayi Charakupa claims the RAF left out the bulk of its outstanding claims liabilityaround R340 billionby switching its accounting standard and recording only a tiny fraction of what it owed.

Accounting Switch That Raised Red Flags

Charakupa says the RAF abandoned its previous standard (IFRS 4) for claims-type obligations and switched to IPSAS 42a standard meant for “social benefit” obligations, not insurance-style liabilities. The change allegedly allowed the fund to push most of its unpaid claims off the balance sheet.

He says that as of March 2021, the RAF should have recorded liabilities of about R356 billion, but instead it reported only R29.6 billion, hiding roughly R326.5 billion of obligations.

The auditor-general gave the 2020-21 RAF accounts a disclaimer of opinion, citing misuse of an unauthorised accounting standard and a material misstatement of the fund’s financial position.

Why It Matters for Victims and Taxpayers

The RAF is funded by a levy on fuel and compensates accident victims. If its liabilities are vastly understated, claimants could be left without funds when they need them. Also, taxpayers may eventually have to step in if the fund cannot meet its obligations.

The whistle-blower argues the fund’s obligations to crash victims didn’t vanishthey were simply hidden. “The underlying obligation did not disappear; it was under-reported,” he said.

Public and Political Reaction

Parliamentary hearings are ongoing. The committee overseeing the RAF is investigating the change in accounting policy and the impact it has on victims waiting for payment.

On social media and in commentary, people are expressing frustration: how can an institution that handles victims’ compensation be so opaque? One contributor wrote: “If they hide billions, how can we trust they will pay my claim?”

What Still Needs Clarity

• Was the accounting standard change formally approved by the appropriate body?

• Who made the decision to switch the standard and when? Was board oversight involved?

• How many claimants remain unpaid because of this manipulation?

• What will be done to hold leadership accountable?

• How will victims’ rights be protected given the scale of hidden liabilities?

Final Thought: A Trust Crisis in Public Finances

The RAF scandal is not just about numbersit’s about trust. When institutions charged with public welfare mislead about their capacity, the ripple effects affect thousands of vulnerable claimants.

In the end, transparency, accountability and reform are the only ways forward. South Africans deserve to know who made these decisions, how much is owed, and whether their future claims are safe.