Whistle-Blower Exposes RAF’s Deep-Seated Corruption and Financial Mismanagement

Modiba reveals ghost claimants, law firm favoritism, and patient abuse at South Africa’s struggling fund

A former Road Accident Fund (RAF) executive has pulled back the curtain on a shocking level of corruption, fraud, and mismanagement that has crippled one of South Africa’s key compensation funds. Sefotle Modiba, RAF’s acting chief investment officer until June 2025, delivered a scathing affidavit to parliament’s standing committee on public accounts, detailing ghost claim payouts, preferential treatment for certain law firms, and financial chaos that saw over R1.2 billion disappear through duplicate payments.

“When I joined in May 2020, the RAF was days away from financial collapse,” Modiba testified, describing a fund without quality controls, reconciliations, or basic financial oversight.

Ghost Claimants and Duplicate Payments

Among the most damning revelations: RAF’s claims verification system had been deliberately disabled since 2016. This left the fund unable to detect duplicate claims, resulting in billions being paid out multiple times. In some cases, payouts were made to deceased individuals or falsified identities, exposing a shocking failure of governance.

Modiba also highlighted collusion between RAF staff, attorneys, and medical providers, which enabled fraudulent claims to bypass scrutiny. The fund reportedly maintained a secretive “preferred law firms” list, prioritizing payments to select firms while ordinary claimants waited monthsor yearsfor their settlements.

In July 2020 alone, R3.6 billion in fuel levy receipts was channeled to a handful of firms, leaving thousands of genuine claimants in limbo.

Medical Overbilling and Patient Abuse

The whistle-blower also shed light on medical overbilling and overservicing, particularly at Sunshine Hospital in Actonville. Patients were often transferred long distances without clinical justification and kept in expensive ICU or high-care units unnecessarily. Some suffered bedsores or received contraindicated therapies, highlighting negligence compounded by profiteering.

“Patients were overtreated and overcharged, and some even suffered harm due to medical neglect,” Modiba said.

Law Firm Collusion and Rogue Writs

Modiba revealed a troubling pattern of law firms issuing duplicate writs of execution, attempting to seize assets for claims already paid. One example cited was R1.79 million paid to Sunshine Hospital in June 2021, followed by a writ demanding the same amount nine months later. Sheriffs reportedly attached RAF assets despite proof of payment, exposing systemic abuse of legal processes.

Deeply Entrenched Corruption

The whistle-blower painted a picture of an organisation consumed by corruption, involving staff, law firms, and medical service providers. Bribery syndicates reportedly operated through anonymous channels to prioritise certain claims.

“The corruption was deeply entrenched. Organised fraud permeated the RAF, yet previous management failed to act,” Modiba testified.

The parliamentary committee, chaired by Songezo Zibi, is now investigating maladministration, reckless expenditure, and financial misconduct at the RAF.

Next Steps in Oversight

Today, RAF security manager Stephen Msiza will testify about excessive spending on bodyguards for former CEO Collins Letsoalo, exceeding the board-approved limit of R480,000, highlighting further governance issues.

Public reaction has been fierce, with social media buzzing over the scale of alleged fraud. Many South Africans expressed outrage, calling for full accountability and criminal investigations.

Modiba’s testimony underscores the urgent need for reform in the RAF to protect victims of road accidents and restore public trust.

With billions mismanaged, ghost claimants paid, and patients abused, the RAF crisis is no longer just financial, it’s a human one.

{Source: The Citizen}

Follow Joburg ETC on Facebook, Twitter , TikTok and Instagram

For more News in Johannesburg, visit joburgetc.com