Two people suspected of links to an illicit gold syndicate were arrested in a late night operation by the Hawks and the South African Revenue Service (SARS).

The swoop‚ in Johannesburg on Thursday night‚ follows the arrest of three others in May this year‚ SARS said in a statement on Friday.

“The syndicate in question is alleged to have fabricated over 16 000 fraudulent invoices (worth about R437 million) to reflect purchases of second-hand gold jewellery‚” it said.

“These fictitious purchases were used in claiming a fraudulent 14% notional VAT input over the period of 2010 to 2012‚ as well as understating their sales during the same period.”

SARS said it had been investigating about 26 companies and individuals for fraudulent tax schemes to legitimise illegally mined or smuggled gold.

Following the May arrests‚ other in the syndicate who used second-hand goods registers and SARS VAT264 forms to misrepresent second-hand jewellery purchases‚ were exposed.

So far‚ eight people and companies have been successfully prosecuted for charges relating to tax compliance and about R65 million in outstanding payments due.