Johannesburg – Some musicians have been accused of stealing from the Southern African Music Rights Organisation (SAMRO) by making false claims for royalties.
The full extent of the irregular royalty claims was uncovered by independent forensic investigators.
SAMRO’s primary role is to administer performing rights on behalf of its members – music composers, authors, and publishers.
It does so by licensing music users (such as television and radio broadcasters, live music venues, retailers, restaurants, promoters, and shopping centres), through the collection of license fees which are then distributed as royalties.
On Thursday, SAMRO told The Bulrushes that some of its members were making “irregular royalty claims”, prompting SAMRO’s Board of Directors to commission a forensic investigation into the matter.
SAMRO said the forensic investigation was conducted to understand the full extent of the problem.
“The resultant forensic report confirmed that some SAMRO members were indeed fraudulently claiming royalties that did not belong to them,” SAMRO said.
The forensic report was presented to SAMRO members on Thursday, (7 December 2023).
SAMRO said members had been given a chance to engage on the forensic investigation report.
Commenting on the anomaly, SAMRO Board Chairperson Nicholas Maweni said: “The report, compiled by independent investigators, made certain recommendations in terms of the steps to be taken with regards to implicated persons”.
Maweni added: “These recommendations were reviewed and supported by yet another independent third party.
“It is clear that certain members have violated the SAMRO Code of Conduct, which is very clear in providing that members’ of SAMRO shall not provide false or misleading information in relation to musical works.
“Also, the same Code of Conduct states that members of SAMRO shall not act dishonestly and/or in bad faith to the prejudice of SAMRO.
“Members are not to make any intentional or negligent misrepresentation to SAMRO, which has the effect of prejudicing SAMRO and/or fellow members and/or prospective members and/or any third party.”
Maweni said the investigations also revealed weaknesses in SAMRO’s internal controls.
Although he did not say how much SAMRO lost through false royalty claims, Maweni said management had already implemented remedial measures to mitigate against such occurrences in the future.
Following the ongoing deliberations by the Board, the forensic report was presented to SAMRO members on 07 December 2023.
“I would like to make it very clear that SAMRO has zero tolerance for fraud – one cent stolen is one cent too many,” said Maweni.
“Anyone caught trying to commit such fraud-related offenses at SAMRO will be prosecuted to the full extent of the law.
“We remain adamant about stamping out any forms of criminality within the organisation.”
Maweni said the case has already been reported to the South African Police Service.
He said as part of the recommendations by the forensic investigators, the Board welcomes the appointment of more independent non-executive directors to improve good governance at SAMRO.
“SAMRO will continue to collaborate and cooperate with the ongoing investigation, which could potentially result in criminal and civil charges being laid against implicated members,” Maweni said.
