MTHATHA – The Mthatha Specialised Commercial Crimes Court has granted bail of R50,000 to tax practitioner Francis Muleso (45) following his arrest by the Hawks on Monday, 26 October, in connection with an alleged sophisticated tax fraud scheme.

The matter was postponed to 18 January 2027 for docket contents. The investigation is ongoing, and further arrests are imminent.

Hawks spokesperson Warrant Officer Ndiphiwe Mhlakuvana said the arrest was carried out by the Mthatha Hawks’ Serious Commercial Crime Investigation (SCCI) team.

“The case relates to the alleged submission of fraudulent tax returns, the misrepresentation of the close corporation’s financial position and tax liabilities between March 2016 and March 2020,” he said.

“It is alleged that Muleso, in his capacity as a tax return practitioner, misrepresented the entity’s taxable position to the South African Revenue Service, including by submitting nil income tax returns despite the alleged existence of taxable business income,” said Mhlakuvana.

He added that SARS reportedly detected irregularities that prompted a referral to the Hawks for further investigation.

Mhlakuvana said a subsequent examination of the close corporation’s banking records and tax declarations allegedly revealed significant discrepancies in its value-added tax (VAT) submissions.

He said, according to the investigation, output tax had been understated by more than R2.7 million, while input tax claims had been overstated by more than R6.1 million.

“The alleged VAT irregularities resulted in reported financial prejudice of R8,854,305.86. When the alleged VAT and income tax liabilities are combined, the total reported financial prejudice to SARS exceeds R9.6 million.”

Mhlakuvana confirmed that, following the issuing of an arrest warrant, Hawks investigators apprehended Muleso at KuGompo City Magistrate’s Court, where he had appeared in connection with a separate matter involving similar charges.

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