THE IMPLICATIONS OF CV FRAUD: DON’T FAKE IT TILL YOU MAKE IT

As a new financial year commences, many businesses are recruiting and onboarding new talent to join their workforce. If recent events have taught us anything, it’s that fraud, particularly CV fraud is on the rise. Providing false information and/or making overstatements on a CV has not only become a popular trend amongst job seekers, but more employers are uncovering CV fraud and misrepresentations made by employees who, in some cases, have been in their employ for a significant number of years. 

What is fraud?

The South African Police Service describes fraud, which is a criminal offence, as “the unlawful and intentional making of a misrepresentation which causes actual prejudice or which is potentially prejudicial to another”. In essence this means a fraudulent act is unlawful, intentional (usually to obtain a financial benefit or personal gain) and causes or may cause damage to another. The implications of fraudulent acts in an employment context, particularly in relation to CV’s, may be best explained through the lens of recent case law. 

Recent Case Law

A number of CV fraud cases have recently emerged and continue to emerge.

In the case of Lesedi Local Municipality v Mphele and Others (JR1546/20) [2023] ZALCJHB 183, the Labour Court (“LC”) stated that the “misrepresentation of qualifications is a pervasive and menacing evil that greedily devours and indelibly taints our employment landscape”. This case concerned a review application brought by a local municipality (“the Municipality”) in respect of an arbitration award issued by a commissioner from the Commission for Conciliation, Mediation and Arbitration (“CCMA”). 

The dispute arose when the Municipality instituted disciplinary action against the First Respondent, who was its Chief Financial Officer (“CFO”), after a forensic investigation uncovered that the First Respondent misrepresented his qualifications and professional memberships in his CV. The First Respondent was found guilty of gross dishonesty and was dismissed. Aggrieved by the outcome, the First Respondent referred an unfair dismissal dispute to the CCMA. At the CCMA, the forensic investigator testified that the First Respondent factually misrepresented having the following qualifications and holding the following memberships: 

  • A BCom Accounting degree from the University of Durban- Westville, whilst in fact he only obtained a BCom degree;
  • An Honours Degree in GRAP (Generally Recognised Accounting Practice), from the University of Stellenbosch, whilst this was not an honours degree but an executive short course with a NQF 8 recognition level;
  • Memberships with the Institute of Internal Auditors of South Africa, entitling him to use the title of GIA (General Internal Auditor), whilst he had on 7 November 2013, cancelled his membership with the IIA SA and could not thereafter, have used that designation; and
  • Holding out to be a Registered Accounting Officer with the Institute of Administration and Commerce (IAC) whilst he has not been a registered Accounting Officer with the IAC since 2008 and could accordingly not claim in 2015, to have been a registered accounting officer.

Notwithstanding the evidence led by the Municipality, the commissioner found that the First Respondent’s dismissal by the Municipality was substantively unfair and ordered the Municipality to retrospectively reinstate the First Respondent. The commissioner was of the view that the First Respondent’s evidence was more persuasive than that of the Municipally on a balance of probabilities, and that he met the requirements of the position and therefore eligible for appointment as CFO. 

However, in the LC, the Court held that the conclusion arrived at by the commissioner does not align with the evidence at all and that the issue was not whether the First Respondent met the requirements for the CFO position as advertised, it had to do with the fact that in his application he presented himself as the holder of certain degrees and professional memberships, which he did not have. The LC was not persuaded by the fact that the First Respondent claimed he made an error when he reflected his qualifications and professional memberships as set out in his CV. The LC found that the commissioner quite evidently failed to properly assess the evidential material placed before him and that he would have found that the First Respondent misrepresented his educational qualifications and his professional standing, had he properly assessed the evidence led by the Parties. For this reason, the LC set aside the arbitration award and ordered the First Respondent’s dismissal as being both procedurally and substantively fair. 

Furthermore, in 2022 the High Court (“HC”) in Umgeni Water v Naidoo and Another (11489/2017P) [2022] ZAKZPHC 80  heard a matter involving a former employer who in addition to instituting disciplinary proceedings against an employee for misrepresenting his qualifications, decided to institute civil action to recover all the remuneration it paid the employee by way of an unjustified enrichment claim. The employee, cited as the First Defendant, made an application to the employer, the Plaintiff in this matter, to join its graduate development programme (“the programme”),and he was successfully appointed. According to the Plaintiff,  the First Defendant misrepresented his qualifications when he applied for a position in the programme. The Plaintiff submitted that the programme was designed and intended for graduates and that the First Defendant was required to have a B.Sc. Chemical Engineering degree in order to enter the programme, which the First Defendant averred he had. This was however not the case and the First Defendant’s misrepresentation was only discovered by the Plaintiff in 2016, after having been with the Plaintiff for nearly eight (8) years. The Plaintiff accordingly instituted disciplinary action against the First Defendant, however, the First Defendant resigned shortly hereafter. 

In the HC, the Plaintiff, through witness testimony explained that having an unqualified person working for the Plaintiff could potentially be extremely hazardous to the well-being of a large number of people who are dependent on water supplied to them by the Plaintiff. Additionally, that graduates employed by the Plaintiff are, inter alia, required to perform calculations to determine which chemicals, and in what quantity it should be added to water that is supplied by the Plaintiff, to millions of people within the province of KwaZulu-Natal. According to the Plaintiff, any error in performing such calculations caused through a lack of knowledge therefore has the potential to have serious consequences for the general populace. The Plaintiff also called an official from the University of KwaZulu-Natal (“UKZN”) as a witness. The official testified that the First Defendant’s degree certificate was not valid and that the First Defendant commenced studies at UKZN in 2002 but was excluded from UKZN’s Chemical Engineering Faculty in 2004 due to a lack of academic progress.  Notwithstanding this, the First Defendant asserted that he has a B.Sc. Chemical Engineering degree and had initially commenced his studies at the University of Durban-Westville in 2002 and concluded his studies at UKZN in 2007 after it merged with the University of Durban-Westville in 2004.

The HC found that there are major discrepancies between the documents submitted by the Plaintiff, which were confirmed by UKZN as being correct and the documents submitted by the First Defendant. Further, that the documentary evidence put up by the Plaintiff was convincing and overwhelming in its effect, which therefore led the Court to conclude that the degree certificate and academic results claimed by the First Defendant to be his are forgeries. The HC concluded that the First Defendant did not possess a B.Sc. Chemical Engineering degree and falsely represented the true state of his qualifications with the intention of securing the benefit of employment from the Plaintiff to the detriment of the Plaintiff who would otherwise not have offered him any form of employment. For this reason, the HC held that the First Defendant acted fraudulently and granted judgment in favour of the Plaintiff. The First Defendant was subsequently required to pay the Plaintiff over two million rand (R 2 203 565.04 to be exact), which the Plaintiff could recover from the First Defendant’s provident fund. Additionally, the HC ordered the First Defendant to pay the legal fees the Plaintiff incurred. 

Implications of CV Fraud 

It is clear that CV fraud has far-reaching financial and reputational effects for both employers and employees. Individuals who do not possess the requisite skills or qualifications for the positions they apply for or hold, may even place the health and safety of communities at risk. 

One key statute employers and employees must consider when recruiting individuals, is the National Qualifications Framework Amendment Act of 2019 (“the Act”). The Act came into effect on 13 October 2023, bar sections 1(h), 3(3) and 32A(1) thereof, and is hailed for its regulation of misrepresented and fraudulent qualifications. In accordance with the provisions of section 32A(1) of the Act, all organs of state, employers, education institutions, skills development providers and Quality Councils (“QC”) will be required to authenticate qualifications presented to them before confirming an applicant’s appointment.

The amendments go further and now state that a person is guilty of an offence if they are a party to the falsification and dissemination or publication of a qualification or part-qualification; and if they fraudulently or falsely claim to be holding a qualification or part-qualification registered on the NQF or awarded by an education institution, skills development provider, QC or obtained from a lawfully recognised foreign institution. In accordance with section 32B(2) of the Act, any person convicted of any of the aforementioned offences, will be fined or imprisoned for a period not exceeding five (5) years, or may be liable to both a fine and such imprisonment. 

Job seekers and employees are therefore cautioned against making misrepresentations and/or committing fraudulent acts when seeking and/or retaining employment. The Courts have clearly taken a firm stance against acts of this nature and will not be lenient when making their final orders. Employers are advised to do a diligent and thorough assessment of all qualifications and references listed on an applicant’s CV and to conduct regular employment reviews to ensure that it has the most updated and accurate information on record. Should it be discovered that an employee has misrepresented themselves on their CV or committed fraudulent acts in relation thereto, more than just disciplinary action can be taken against such employees. Where damage is suffered as a result of an employee’s fraudulent  conduct, employers may be entitled to restitution and may claim back the benefits received by an employee. 

Andrea Miguel – Candidate Attorney 

JUSTINE DEL MONTE & ASSOCIATES INCORPORATED