Law firm slammed for allegedly pocketing R2.2 billion from RAF

The CEO of the Road Accident Fund (RAF), Collins Letsoalo, has alleged that the law firm Gert Nel Attorneys has benefited irregularly from medico-legal claims.

“Over the past period of five years, Gert Nel Attorneys has been paid over R2.2 billion from the RAF,” Letsoalo said. 

“For R2 billion, we know that is close to R500 million that he has made. You are not shocked why this man fights so much. He wants to continue.”

When asked to break down this R2.2 billion figure, Gert Nel, CEO of Gert Nel Attorneys, told Daily Investor, “We intend to ask the RAF the same question – we do not have the specifics of this figure and hence cannot confirm or deny the correctness thereof.” 

A recent report by IOL states that the RAF has blocked the disbursement of R65 million in claims over the past three financial years as part of its efforts to combat fraudulent and corrupt activities.

A total of 2,031 fraudulent claims were rejected: 870 in 2023/2024, 713 in 2022/2023, and 448 in 2021/2022. Due to their fraudulent nature, these claims were not processed or finalised.

Letsoalo highlighted that the RAF is dedicated to fighting illegal practices used by law firms when submitting claims on behalf of their clients.

“Before then, the lawyers were making much more,” Letsoalo said. “This is a man who has made R2.2 billion, and at least R500 million has gone into his pockets.” 

“He is a master of contingency fee agreements. He even prides himself on winning an award for understanding the contingency fee agreement.”

“There are other indiscretions, which include charging us attorney party costs that should be party-party costs, which is something we are fighting. What I am saying is that once you see Gert Nel, think about the R500 million he has made.”

However, in response to Letsoalo’s claim that the firm has charged excessive attorney-party costs, Nel explained that “there is nothing such as attorney-party costs” – as far as the RAF is concerned, there are only attorney-client and party-party costs.

“Hence, we have no idea what Letsoalo is talking about.”

Although Nel believes the RAF’s efforts to combat fraud are justified, he said fraud is not new. 

The RAF, previously known as the Multilateral Motor Vehicle Accidents Fund, has always had internal investigators and claims handlers to address fraud both within and outside the organisation.

Nel explained that the firm ensures transparency and accountability in its handling of client funds and RAF payments through its compliance with the Legal Practice Act (LPA).

“The LPA is specific and prescriptive in the manner a practitioner is required to account to their clients.” 

“We have been in practice since 2001 without falling foul to the prescripts of the LPA, which is indicative of the fact that we remain true to the ethical code of conduct.”

He added that the firm also has measures in place to ensure the legitimacy of RAF claims it handles. 

“Each and every instruction is carefully considered against the required protocol – factually based information backed by the required documentary proof of the LPA, POPIA, FICA, etc.”

Nel has decided to institute legal action and called for an apology in light of these remarks, confirming that Letsoalo’s lawyers asked for a stay in the proceedings until the third week in January 2025. 

He further explained the impact that these comments had had on the firm and its clients. 

“We are grateful for the support we have received from clients, colleagues, various stakeholders and the public in general.”

“Having regard to social media, we are pleased to see that by us speaking up and calling the CEO and the Executive on their unlawful tactics and spreading of half-truths, the public – road crash victims in the system, even RAF employees – are also taking action, testifying to their own experiences subject to this unlawful rule of the RAF.”

Nel further cautioned that Transport Minister Barbara Creecy should not sit idly by. 

“The Minister can simply not deny the reality of the catastrophic disaster awaiting the RAF if left unattended, resulting in the ultimate failure of government to address the Constitutional rights of road crash victims.”

“The Minister must be seen to take action now and address the unlawful reforms implemented by the CEO and the Executive (Board) of the RAF – various Court Orders, judgements, even the RAF’s own financial reports are indicative of the mismanagement of the RAF – if she has any interest in saving the RAF.”