PUBLIC PROTECTOR Busisiwe Mkhwebane has ordered the DA-run George Local Municipality in the Western Cape to take action against officials who irregularly invested R350 million with insurer and financial services firm Old Mutual.
Mkhwebane released 14 investigation reports yesterday including her probe into a complaint lodged by Public Works and Infrastructure Minister and GOOD Party leader Patricia de Lille.
”To remedy this maladministration and improper conduct, the municipal manager (Dr Michele Gratz) must take disciplinary action against the municipal officials who were implicated in non-compliance with the municipality’s policies and procedures that resulted in the irregular investments of municipal funds with Old Mutual within 60 working days from the date of the report,” the public protector found.
The investigation follows allegations of improper conduct and maladministration by the George Local Municipality on the alleged irregular investment of public funds to the amount of R350m with Old Mutual Limited during 2017.
According to Mkhwebane, the municipality invested municipal funds with Old Mutual irregularly.
”The investments were in violation of section 13(1) of the Local Government: Municipal Finance Management Act (MFMA), the Municipal Investment Regulations and the Cash and Investment Policy of the municipality,” reads the report.
In July 2017 the municipality entered into an agreement with Old Mutual when it irregularly invested an initial amount of R200m in public funds with the financial services company and another subsequent investment in November 2017 of a further R150m.
Mkhwebane ordered George mayor Leon Van Wyk to take the appropriate steps to ensure that the municipality’s audit committee is properly constituted as contemplated by section 166 of the MFMA with members that are competent and that they have the necessary skills, qualifications and experience to perform their statutory responsibilities.
The Hawks and the National Prosecuting Authority (NPA) advised Mkhwebane that charges of fraud and corruption were proffered against the municipality’s former chief financial officer Keith Jordaan, DA councillor DL Cronje snr and his son DL Cronje jr but the NPA declined to prosecute the matter in the 2020/21 financial year.
The provincial government also advised that Jordaan was dismissed following a disciplinary hearing in connection with the matter and vacated his office in July 2019 and that the council appointed a special committee to investigate and make a finding on the alleged breach of the code of conduct for councillors by Cronje snr.
The municipality’s council also resolved in March last year that Cronje “made himself guilty of the breach of Items 2 and 5(2) of the code of conduct for councillors” and that it imposed a sanction of a fine equivalent to one month’s salary on him along with a written apology to be provided to the speaker.
Political Bureau