UPDATED: Is INSETA under siege? Unpacking the battle between GIFS and INSETA

In a complex legal and ethical battle, the Graduate Institute of Financial Sciences (GIFS) is demanding a staggering R246 million from the South African government, accusing the Insurance Sector Education and Training Authority (INSETA) of unlawfully destroying their business through de-accreditation.

However, upon further analysis, the paper trail suggests a far more intricate narrative, one that involves internal whistleblowers, unverified affidavits, and a yet-to-be-resolved investigative report.

The saga commenced on 22 April 2021 with an explosive email sent by Uthika Maharaj, a former employee of the GIFS, to the INSETA management, laying bare serious allegations of fraudulent conduct within the institution.

Maharaj claimed that the GIFS had concocted a story regarding damaged learner portfolios during a supposed Covid-19 sanitisation exercise, an incident that, as investigations revealed, never happened.

Further complicating matters, Francinette Zagorski, the former Chief Financial Officer of the GIFS, corroborated Maharaj's claims, documenting her refusal to endorse what seemed to be a fraudulent affidavit concerning the alleged damage.

This internal whistleblowing sparked an investigation conducted by Masegare and Associates Incorporated in November 2021.

The outcome confirmed several alarming findings, primarily, that the GIFS allegedly misled the INSETA regarding the conditions of learner portfolios. The investigation indicated that instead of being securely stored, these portfolios were kept in inadequate conditions, in stark contrast to claims made by GIFS officials.

In an early 2024 interim ruling, Judge Yacoob granted GIFS a temporary reprieve by reinstating its accreditation, but only until June 30, 2024, which was not a permanent reversal.

Notably, this ruling has often been mischaracterised by the GIFS's advocates, who claim it has been flouted by the INSETA. In reality, three separate court judges corroborated that the INSETA acted within its legal rights, demonstrating a consistent judicial conclusion that undermines the GIFS's narrative.

The inquiry into the GIFS's practices, though seemingly relegated to the background, remains crucial.

The investigative report that documented the GIFS's alleged fraudulent conduct has never been formally challenged or disproved in a court of law, maintaining its status as the definitive account of the situation.

Despite the GIFS's claim that their de-accreditation was unlawful, the fact remains that no evidence has surfaced against the integrity of the Masegare report.

In light of these developments, the question arises: if the GIFS believes its de-accreditation was wrongful, why has it not re-applied for accreditation following the lapse of its interim status? Their R246 million claim hinges on a premise that continues to rest on shaky legal grounds. The Inseta further commented: “Inseta rejects any claims or unwarranted financial demands against the organisation. We view the demands of the GIFS as nothing but an attempt to receive payment for services not rendered.

“The de-accreditation of the GIFS was done following a due process, which remains unchallenged in courts. It is disingenuous of the GIFS to make unwarranted quarter-billion claims against the institution. The Inseta would like to place on public record that it has never reached any settlement agreement with the GIFS for claims they are making as some media reports suggested,” the institution said.

The unrest is compounded by ongoing criminal investigations involving both the INSETA and the GIFS, with accusations of fraud exchanged between the institutions. While the INSETA has opened charges against the GIFS, the defamation case it initiated against the GIFS and its CEO lingers, further tangling the narrative.

In conclusion, the supposed siege on the INSETA emanates not from a wronged institution seeking justice but from a body facing serious allegations of impropriety from within.

The intricacies of the case raise significant questions about accountability and transparency within South Africa's skills development sector.

The Organisation Undoing Tax Abuse(Outa) held a different view and has voiced concern about the situation, with CEO Wayne Duvenage commending the GIFS and its whistle blowers for their courage and called for an urgent independent investigation into the allegations.

“They could have looked away and said nothing about these irregularities and retained their accreditation,” said Duvenage.

Gifs insist that the former minister minister Nobuhle Nkabane was on the brink of signing a settlement prior to her dismissal. 

"We can confirm that we were engaged in settlement negotiations with the former Minister of Higher Education, Minister Nkabane, which had reached final stages prior to her departure from office," said Selina Maharaj, GIFS's risk and compliance manager .

Maharaj said that the matter was currently in court and will involve the INSETA as well as the current Minister of Higher Education.

"Despite several formal requests to meet with the Minister, he has declined and advised that we address this matter with the CEO of the NSETA.

"(The) INSETA continues to remain in violation of three court orders, the most recent issued by the Supreme Court of Appeal, the second highest court in the country. This reflects a deliberate disregard for the rule of law by an organ of state that ought to be holding itself to a higher standard".

Attempts to get comment from Department of Higher Education and Training as well have been unsuccessful

DAILY NEWS