Bogus vendors selling fraudulent B-BBEE certificates are harming the South African economy. A fake document will assist a company achieve a particular B-BBEE status, allowing that company to bid on lucrative tenders, even if they are not properly registered.
This means that business is being taken away from legitimate and compliant organisations.
The most common types of fraud involve changing dates on certificates and understating annual turnover, but entire documents have also be faked. These fraudulent certificates can be costly to acquire, but the price is even greater for a company caught red-handed.
With a false document, that company’s B-BBEE level will not be recognised and this could blacklist them from conducting business in the public sector, but a more serious implication is the prospect of criminal charges. The B-BBEE Amendment Bill suggests penalties of up to a decade in prison or a fine of 10% of a company’s annual turnover, or both.
The responsibility for a B-BBEE certificate ultimately lies with the business owner/partner/director, but it’s also essential for all procurement offices and anyone building a supply chain or enterprise development programme to be aware of fraudulent certificates. It isn’t always easy to spot a fake, but here are some tips to assist you:
- Go through all the details of your B-BBEE certificate very carefully.
- Check that the certificate is based on the old codes, as the new codes only come into effect on 1 May 2015.
- Take note of the point allocations, as it doesn’t make sense to have 27 points if that element is only scored out of 25.
- Check the edges of logos for discolouration or low resolution and inaccurate logo sizes, as these may be cut and pasted.
- Look at the alignment, type size and spacing as these are often inconsistent.
- Double check the contact details on the B-BBEE certificate, especially the company’s reference number.
- If you find any discrepancies, immediately check with the verification agency.
To protect yourself and your business, it’s imperative to use a verification agency that is certified, competent and trustworthy. Your B-BBEE certificate must be legitimate so you can maintain your status, and to ensure you avoid the possibility of legal action.
LEAP offers advisory services on all elements of the existing and revised B-BBEE Codes of Good Practice. For assistance, information or support contact LEAP on 011 449 7074 or visit www.leapco.co.za.