Durban - A senior government official has been arrested for allegedly receiving more than R2 million in kickbacks from a Durban plant hire company that was awarded more than R300m in contracts to help repair KwaZulu-Natal’s ailing road infrastructure.
The arrests are the result of an 18-month investigation by the KwaZulu-Natal police anti-corruption task team, comprising the Hawks, Special Investigations Unit and Assets Forfeiture Unit.
Simphiwe Majola, 56, a regional manager in the KZN Department of Transport, appeared in the Durban Commercial Crime Court on Wednesday.
He has indicated to the court that he intends pleading not guilty to multiple counts of corruption, fraud and money laundering.
A second government employee, Sukla Pooran Maharaj, based at the provincial transport department’s offices in KwaDukuza (Stanger), is also alleged to be part of the racket.
He was arrested on Wednesday while holidaying in the Wild Coast and has appeared in the Stanger Magistrate’s Court, which granted him bail of R10 000 before adjourning the matter to December 19.
Maharaj is alleged to have received more than R300 000 in bribes from the company owners - a Durban couple - for ensuring they received the bulk of the contracts.
The two cases - and those of others that will be opened when “many more” arrests follow - are expected to be joined for trial next year.
Majola, who was in charge of awarding short-term road repair and maintenance contracts to various companies on the provincial database, is alleged to have bypassed internal procurement procedure controls that are meant to spread the contracts to various small contractors, and awarded the bulk of the work to the company owned by the Durban couple.
The couple, who are believed to be in Johannesburg, have apparently arranged to hand themselves to police tomorrow.
Their names are known to the Daily News and will be revealed when they appear in court.
The contracts awarded were for the hire of plant equipment used in the repair of roads.
They were also part of the provincial government’s plan to empower emerging civil contractors.
Police are also probing R200m worth of contracts for the department awarded to two other companies linked to the businessman.
The investigation, led by Captain Fana Khawula, uncovered that between 2007 and last year the businessman allegedly:
* Bought Majola a top-of-the-range Mercedes-Benz C280 worth more than R430 000.
* Installed a pool at his Ashburton home in Pietermaritzburg for R83 072.
* Paid a R1.5m deposit for Majola to buy a dairy farm in Port Shepstone, and
* Paid R146 308 in architect’s fees for renovations to his home.
The renovations to the home did not go ahead because Majola’s neighbours objected.
During his bail application on Wednesday, Majola said he had been employed by the Department of Transport since 1994 and earned a salary of R47 000 a month.
He said he was not a flight risk and intended to plead not guilty to the charges.
He said he had been aware of the investigation since last year.
The court accepted Majola’s petition and granted him bail of R50 000. The case was adjourned to March 18.
According to sources with intimate knowledge of the probe, the investigation into Majola began after a department employee grew suspicious of how he could afford such an expensive car.
The employee did further checks on the vehicle and discovered it was registered in the name of a Durban businessman who provided services to the department.
According to a forensic report commissioned by the Department of Treasury, the employee reported the matter to the Special Investigations Unit.
The Daily News is in possession of the forensic report.
Police allege that in 2007 a company owned by the couple had purchased the Mercedes-Benz from a dealership in uMhlanga and had given it to Majola in 2008.
The vehicle was paid off in three instalments - R5 000, R300 000 and R125 650 - between August and December 2007.
According to the State’s charge sheet handed to the court on Wednesday, Majola and the businessman went to great lengths to conceal how the vehicle was purchased, but not before the colleague had investigated.
The vehicle, which was originally registered in the businessman’s name, was transferred into the name of a Gauteng car dealership owned by a Mr Padaychee who is an alleged associate of the businessman, in July 2008.
The following month the vehicle was transferred from the Gauteng dealership to Majola.
The forensic report alleges that Majola went against department protocol by approving the hire of the plant equipment for the businessman beyond the minimum 60 days.
In several incidents, a highly placed source said, the businessman charged the department for use of an earth-moving machine in Port Shepstone and Stanger for the same day, which resulted in payments exceeding R1.7m.
“This is just the tip of the iceberg,” a police source said on Wednesday.
“We plan to arrest many more people for this. We expect at least 20 arrests.”
Daily News