MEDIA STATEMENT
Johannesburg, South Africa, Friday 10 January 2025 – Public Interest SA is outraged by the systemic abuse of the Road Accident Fund (RAF) by unscrupulous legal practitioners, with the alleged billions pocketed by a single firm of attorneys over five years serving as a glaring example of the rot undermining South Africa’s social safety nets. This calls for an immediate overhaul of the contingency fee system, which has been weaponised by greedy "ambulance chasers" to fleece the RAF and exploit vulnerable road crash victims - all at the expense of the South African taxpayer.
The staggering claims by RAF CEO Collins Letsoalo that law firms have enriched themselves through irregular and unethical practices highlight a longstanding culture of impunity within the legal profession. The abuse of medico-legal claims, inflated legal fees, and dubious billing practices such as “attorney-party costs” are clear indicators of how venal lawyers exploit loopholes in the system.
Letsoalo’s assertion that one law firm alone may have pocketed at least R500 million in profits is symptomatic of a broader failure to rein in unethical practices in RAF-related litigation. While attorneys fingered in this practice deny these allegations and threaten legal action, the scale of payments over the years raises urgent questions about the role of the Legal Practice Council (LPC) and other oversight bodies in preventing such alleged abuses.
Public Interest SA demands the following immediate actions to safeguard the integrity of the RAF and ensure justice for road crash victims:
Urgent Reform of the Contingency Fee System: The Legal Practice Act (LPA) must be urgently amended to include stricter regulations and oversight mechanisms to prevent its continued abuse. Contingency fee agreements, while designed to facilitate access to justice, have become tools for unchecked profiteering. A maximum amount for contingency fees per claim must be set.
Accountability by the Legal Practice Council: The LPC must prioritise investigations into unethical legal practices surrounding RAF claims. Firms engaging in dubious billing practices or profiting disproportionately from RAF payouts must face harsh sanctions, including disbarment and punitive financial penalties.
Enhanced Safeguards in the RAF: The RAF must strengthen its internal controls to detect and prevent fraud, including adopting advanced auditing systems to monitor payments and claims. Any collaboration between legal practitioners and corrupt RAF officials must be exposed and prosecuted.
Executive Accountability: Public Interest SA calls on Transport Minister Barbara Creecy to intervene decisively and take immediate measures to address reports of internal mismanagement of the RAF and the external exploitation by certain law firms. Failure to act risks further eroding public trust in the RAF’s ability to fulfil its Constitutional mandate to protect road crash victims.
Road crash victims - already suffering physical and emotional trauma - are being further victimised by the greed of unethical lawyers who prioritise profits over justice. These predatory practices not only deny victims the financial relief they deserve but also erode the RAF’s capacity to fulfil its obligations to the public.
"It is deeply troubling that some legal practitioners have chosen to fight reforms aimed at curbing corruption and inefficiency within the RAF. This resistance underscores the urgency of holding those responsible for systemic exploitation accountable," says Tebogo Khaas, chairman of Public Ineterst SA .
Public Interest SA stands in solidarity with road crash victims and the broader South African public in calling for an end to this unchecked looting of public funds. The time for reform is now.
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ABOUT PUBLIC INTEREST SA
Public Interest SA is committed to fostering ethical governance, accountability, and social justice in South Africa. Through advocacy and activism, we strive to hold those in positions of power accountable and ensure the protection of vulnerable citizens.
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Bagaetsho Oteng
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