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COIDA: Scam alert re Service offerings
- 19 November 2025
- Law
- South African Accounting Academy
Summary:
The Compensation Fund (CF) have issued an alert that there are certain unscrupulous companies and individuals who are defrauding unsuspecting Employers by means of disguising as representatives of the Compensation Fund and licensed companies to do COID service on behalf of the Fund.
Article:
The scam involves the fraudsters in some instances using the letterhead of the Department of Employment & Labour and Compensation Fund offering a variety of services to unsuspecting employers:
- Requesting upfront paying of cash directly to their (unscrupulous companies and individuals) bank account giving them an impression or promising them to pay on their behalf their Notices of assessments amounts owed to the Compensation Fund.
- Issue fraudulent notices of assessment with falsified assessment amounts
- Issue fraudulent forged Notices of Assessments with incorrect or fraudulent banking details.
- Issue fraudulent letters of good standing.
- Mislead employers by offering them non-existing discounts or reduced assessments on their return on earnings or refunds on their notices of assessments or COID Liability.
- Corruptly promise Employers to expedite their COID services (especially obtaining letters of good standing) by giving them preferential treatment in exchange for gratification.
Compensation Fund Services are free and there are no other licensed parties for COID services other than RMA (Rand Mutual Assurance) and FEMA (Federated Employers Mutual Assurance Company).
To test for authentication of a valid letter of Good Standing please use the following link: https://cfonline.labour.gov.za/VerifyLOGS/;jsessionid=6A91FA7771F21E6EA09D56AFABEA3B65.CFONLINEI1S1?0
Click here to download the document:
Relevance to Auditors, Independent Reviewers & Accountants:
- The COID Act is yet another piece of legislation that your clients must comply with, and which you must assess compliance with. If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
- As an employer and Practitioner, you should be aware of the latest scams that fraudsters use to solicit money from unsuspecting customers.
Relevance to Your clients:
- As an employer, your clients need to comply with COIDA.
- Your clients should be aware of the latest scams that fraudsters use to solicit money from unsuspecting customers.