MPUMALANGA – Smangaliso Innocent Khoza, a 40-year-old director of four companies, was convicted by the Nelspruit Specialised Commercial Crime Court on Monday, 10 June 2024. Khoza was found guilty of multiple counts, including money laundering and tax fraud.

The charges stem from an investigation initiated in April 2017 by the Hawks’ Nelspruit-based Serious Commercial Crime Investigation team, following a referral from SARS. Khoza was implicated in fraudulent activities involving four entities: Simangalesi Trading Enterprise CC, Madam and Eve General Trading CC, Khuzudumo Trading (Pty) Ltd, and Ngcebo Empire Projects (Pty) Ltd. Khoza, a registered e-filer, submitted fraudulent tax returns on behalf of Simangalesi Trading Enterprise CC and Ngcebo Empire Projects (Pty) Ltd, resulting in undue tax refunds amounting to R990,297.75 for the 2013 tax year.

The investigation uncovered further fraudulent activities involving Khoza’s associates. Busisiwe Prudence Nkosi, Khoza’s life partner and the sole member of Madam and Eve General Trading CC, also engaged in fraudulent tax filings, resulting in an undue refund of R986,686.12 for the 2013 tax year. Sabelo Given Khumalo, Khoza’s brother and the sole director of Khuzudumo Trading (Pty) Ltd, was implicated in similar fraudulent activities, failing to provide proof for tax returns and misrepresenting information to SARS.

Ngcebo Empire Projects (Pty) Ltd, under Khoza’s directorship, failed to substantiate claims in their 2014 tax return, resulting in actual losses to SARS amounting to R955,307.56 and R990,297.75, and potential losses totaling R32,092,602.87 and R9,625,228.59. SARS has since frozen the business bank accounts associated with these entities. The proceeds of these fraudulent activities were transferred across various entities, business, and personal bank accounts.

Khoza was convicted of contravening Section 6(a) of the Prevention of Organised Crime Act (money laundering), Sections 235(1)(a) of the Tax Administration Act (tax fraud), and Section 4(b) of the Prevention of Organised Crime Act (money laundering).

The court has postponed Khoza’s case to 23 August 2024, for a pre-sentence and correctional supervision report, as well as sentencing. The trial for the remaining accused is set to continue from 10 to 11 June 2024, with all witnesses subpoenaed. The State Advocate has submitted an application for a confiscation order under Section 18 of the Prevention of Organised Crime Act (POCA), and the investigation remains ongoing.