Last week, GroundUp reported the findings of two first-year Stellenbosch University students, Joel Cedras and Veer Gosai, who exposed fraudulent activity within the Social Relief of Distress (SRD) Grant system.
The South African Social Security Agency (Sassa), which manages the grant distribution to millions of citizens, acknowledged the presence of fraud but criticized the students' findings for overlooking the agency’s efforts to counter these issues.
What the Students Discovered
The students found that fraudsters were using unsuspecting individuals' identity numbers to apply for SRD grants, with funds being deposited into bank accounts fraudulently opened under the same identities.
This discovery is troubling, as it suggests that many citizens unknowingly have SRD grant applications filed in their names. If these individuals qualify for the grant, the funds are stolen from them.
Gosai revealed that his own identity had been used to apply for an SRD grant, and a bank account was created in his name without his knowledge.
We were shocked to discover that bank accounts were opened in our names and SRD applications submitted without our consent. People were receiving payments on our behalf
Through legal vulnerability tests, the students uncovered that the system allowed a suspiciously high number of applications for individuals born in February 2005, with a staggering 91% application rate—an indicator of potential fraud.
The pair reported that 74,931 SRD applications were made for individuals born in February 2005. According to Statistics South Africa, there were only 82,097 births in that month, meaning the application rate was abnormally high. In a survey of 60 university students, 56 reported SRD applications in their names, despite never having applied for the grant.
How Sassa Verifies SRD Grant Applications
To qualify for the SRD grant, applicants must be South African citizens, residents, or special permit holders and cannot receive other forms of government support, such as UIF benefits or NSFAS bursaries. Additionally, their bank balance must be below R624.
Sassa verifies applications by cross-checking with the Department of Home Affairs for identity confirmation and collaborating with the Department of Treasury for income verification. Once these checks are satisfied, payments are processed as part of the monthly payment schedule.
The students’ findings suggest, however, that criminals are bypassing these verification steps.
Sassa spokesperson Breton Van Vrede confirmed the accuracy of the students’ findings but stated that the agency has long been aware of identity fraud issues.
He emphasized that Sassa has made significant progress in implementing additional checks to ensure the correct recipients receive the grant.
We believe the control measures we've introduced are stringent,
Sassa has ramped up its security by deploying algorithms to detect suspicious applications and strengthening identity verification methods, including facial recognition and one-time password (OTP) checks.
As fraud tactics have evolved, Sassa has responded by adopting new countermeasures. These include data analysis algorithms to flag questionable applications for further verification.
Van Vrede revealed that around 2 million SRD grant applications have been flagged due to suspected fraud. These applications have been placed under "referred status," requiring further identity verification, including the use of facial recognition software.
The students, however, argue that the SRD system needs a complete overhaul, either through enhanced verification processes or a full system rebuild. They also criticized Sassa’s reliance on biometric verification, calling it impractical and an unnecessary burden on vulnerable citizens.
Civil society groups echoed these concerns, noting that many people lack access to devices capable of completing the required verification steps.
