FIA notes spike in tax evasion
Mbongeni Mguni | Friday May 23, 2025 12:23
The findings are contained in a report released by FIA this week on suspicious transaction reports between January and June 2024.
FIA researchers found that Zimbabweans were mainly involved in tax evasion, accounting for about P30.8 million, followed by Batswana with P22.4 million and Chinese business owners with P14.3 million.
In a first for their reporting, the intelligence agency’s researchers broke down the suspicious transaction reports into the crimes these reports are linked to, then further broke down this information into nationalities, location of the suspected crime and where the proceeds were flowing to.
Besides tax evasion, other top crimes picked in the suspicious transaction reports included externalisation, fraud, illegal deposit taking and money laundering. Externalisation involves the illegal or unethical transfer of capital from one country to another.
“Batswana are implicated in all of the five top predicted offences, however tax evasion and fraud rank highest,” FIA noted. “Chinese are only active in externalisation and tax evasion, although they are highly valued in externalisation while Zimbabweans are mostly involved in tax evasion. “South Africans and Malawians are mainly involved in tax evasions and in other predicate offences in which they have small suspicious transaction report values. “Tax evasion is popular with all nationalities.”
Besides Zimbabweans and Batswana, other top nations involved in tax evasion during the period under review included the Chinese with P14.3 million and South Africans with P8.1 million.
The Chinese were the lead nationality in suspected externalisation, FIA researchers found.
“In Francistown, several Chinese owned companies have been suspected of externalising funds, particularly in the retail business,” the researchers said.
According to FIA researchers, the report sought to find out nationalities involved in illicit transactions because “understanding who is involved in suspicious transactions helps to detect patterns and assess risks”.
The report found that out of the P143.7 million in all suspicious transaction reports between January and June last year, Batswana accounted for about 38% of values, followed by Chinese at about 32% and Zimbabweans at around 22% of the total value.
The researchers also found that adults dominate tax evasion cases, while youths are mainly involved in illegal deposit taking. Illegal deposit taking refers to the unauthorised collection of funds from the public without a banking or financial services license. Much of these scams involve forex or other get-rich-quick schemes spread mainly via social media where victims are promised astronomical returns for seemingly small “investments”.
FIA researchers found that these types of schemes are mainly concentrated in Gaborone.
“Youth-led groups in Gaborone claim to trade foreign currencies on behalf of investors, promising fixed high returns but often lacking proper trading strategies,” the report noted.
In terms of location of crimes, FIA researchers found that Gaborone accounted for over 71% of tax evasion, while Francistown was the major hotspot for funds externalisation, responsible for almost 90% of the total.
Gaborone also had the highest fraud cases, contributing over 81%, and also led in illegal deposit taking with over 68% of the reported cases. The capital was also the epicentre of money laundering and other financial crimes, followed by Mogoditshane and Palapye.