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Durban - A Richards Bay businessman who has pleaded guilty to fraud and corruption charges relating to more than R52 million in government tenders, says the provincial Department of Public Works knew about the irregularities in how he received tenders, but continued to use his services.
Ishwarlall Ramlutchman, who describes himself as a humanitarian and businessman, earlier this week filed responding papers to the State’s application for a confiscation order once he is sentenced.
Shortly after Ramlutchman, 37, pleaded guilty in the Specialised Commercial Crimes Court, the Asset Forfeiture Unit, acting on a restraint order from the Pietermaritzburg High Court, seized his assets, including two residential properties, his business premises and about 26 luxury cars.
In court papers, the unit’s forensic investigator Akbar Ally said the assets did not satisfy the confiscation amount of R52 million.
Ramlutchman’s assets amount to about R10 million and he is ordered to disclose all his property to the curator, Trevor White, of PriceWaterhouseCooper. Details were required of gifts he made to others, directly or indirectly.
In September Ramlutchman pleaded guilty to submitting false documents through his company, AC Industrial, to the Construction Industry Development Board to improve his firm’s grading for tenders.
He was charged with fraud and corruption in September and is out on R20 000 bail. Sentencing is expected on November 21.
In court papers, Ramlutchman said the provincial Department of Public Works received full value for the R52 million paid to him and that the department did not consider him to have benefited unduly, “nor does it consider itself prejudiced”.
He argued for the confiscation to be dismissed, saying in 2009 it had been discovered his registration and grading with the construction board was irregular and it had not properly qualified him for the Public Works contracts.
“I was internally prosecuted by the construction board and received a sanction which included a condition which permitted me to continue with the Public Works projects in question. I was also permitted to re-register with the board.
“Despite Public Works being fully aware of the irregularities in the procurement of the tenders in question, they continued to utilise my services to complete the unfinished projects and I was permitted to obtain a grading and to tender for new Public Works KZN projects,” he said in his affidavit.
Ramlutchman argued that he had used his own money to buy the materials and pay for the labour necessary to construct the buildings.
He had made these payments in advance and the payments by the department were “reimbursement” of his outlay.
He also argued that his profit for the “considerable time and effort which I invested in the projects” was less than 10 percent of the total payment to him.
“All the projects were completed to the satisfaction of Public Works KZN, which was enriched to the value of at least R52 million,” he said.
He felt that the Asset Forfeiture Unit was now seeking to “fill its coffers to the tune of R52 million”, based on fraud, when there was no prejudice to Public Works.
“Simply put, the state wants the buildings and all of the money back, that is to get the buildings for free,” said Ramlutchman.
In the criminal matter the state made no attempt to claim the sum of R52 million.
The two residential properties seized, said Ramlutchman, were heavily bonded and the third property was his business premises.
The confiscation order proceedings were adjourned and will resume next month.