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Johannesburg - A forensic audit into long-term contracts at South African Airways Technical (SAAT) has laid bare how some of the airline’s senior executives contravened all regulations to dispose of the airline’s assets at prices way below their market value. This was done to benefit companies they allegedly have links with.

The Sunday Independent has seen a forensic report into the sale of SAAT’s 12 ground power units (GPUs) - vehicles that supply power to aircraft parked on the ground - that the airline procured in 2015 ostensibly to minimise fuel and and maintenance costs.

The report, compiled by independent forensic investigators Open Water Advanced risk solutions, reveal how these units were sold to a local aviation company, JM Aviation SA, which together with its United States-based partner AAR Corp, was controversially awarded a R1.4billion five-year components support and maintenance contract.

The report reveals how SAA head of procurement Nontsasa Memela played a role in the sale of the units, which were almost brand new, each of which was bought for around R800 000, to JM Aviation for R248 000 per unit. In total, SAAT paid about R11million, inclusive of R2m shipping costs for the units.

JM Aviation in turn sold them for about R3.3m to Swissport from whom SAAT is now leasing them back at R450 to R550 per unit per hour.

The report shows how in an email dated June 21, 2016, JM Aviation director Vuyelwa Sokhulu addressed an email to Memela in which she thanked her for the meeting they had on the same day pertaining to the ground power units.

In the mail, prices of the GPUs are discussed and Sokhulu amended her company’s offer to R248 000. On July 7, 2016, another SAA staffer sent an email to Memela asking for her approval to issue the invoice to which Memela responded the same day saying that was the reviewed price. The audit found the serial numbers of some of the units had been deleted.

JM Aviation director Vuyisile Ndzeku, who is also a director at Swissport, said it was none of his business how SAAT sold the units to his company. He said questions on whether these units were sold procedurally had to be directed to SAAT.

“Let them asnwer on how these units were sold. From our side we adhered to all necessary procedures in procuring those units,” an irritated Ndzeku said.

The Sunday Independent sent questions to Memela, however she declined to comment, citing company protocol. She referred enquiries to SAA.

Despite the forensic report finding the disposal and rental of the GPUs contravened prudent financial management principles and Treasury regulations, acting SAA chief executive Musa Zwane was unconvinced.

He said: “The disposal of the units was authorised by the board on recommendation by the acting SAAT CEO at that time adding there was a board resolution dated June 15, 2016, to that effect.

“The disposal of assets is provided for in our supply chain policy and that process was followed. Items disposed of in this instance, all fall under the inventory which was under the delegation of authority of the board,” said Zwane.

When asked if Ndzeku, who is a director at both JM Aviation and Swissport, had had an influence in the sale of the units to his company, Zwane said: “An arrangement between Swissport and its BEE partner has nothing to do with how SAAT disposed of the GPUs. I did not personally benefit nor am I aware of anyone benefiting from this deal.”

Zwane concluded: “Any criminal conduct alleged in the award of this or any tender must be reported with law enforcement agencies for criminal investigations to ensue.”

The Sunday Independent