Durban - The Special Investigation Unit (SIU)has found that five senior employees of the Joburg Property Company (JPC), including its chief executive and chief financial officer, might be guilty of financial misconduct in the awarding of contracts to provide deep-cleaning and sanitisation services.
President Cyril Ramaphosa mandated the SIU to probe the misappropriation of public funds related to government’s multibillion rand Covid-19 expenditure
According to the SIU reports, which are in the possession of IOL, the implicated senior JPC officials inflated prices quoted by the service providers which caused the city-owned entity to incur fruitless and wasteful expenditure of R18 321 620.
The SIU reports were sent to Joburg mayor Geoffrey Makhubo and acting city manager Floyd Brink.
The JPC, a City of Joburg entity is mandated to manage and develop the billions of rand in city property assets for the purpose of maximising their social and commercial opportunities.
Those implicated in the report are chief executive Helen Botes, chief financial officer Imraan Bhamjee, senior manager of supply chain management Fitzgerald Ramaboea, general manager of special projects Gowrie Sunker and supply chain management manager Nandisa Zondo.
The report states that all five might be guilty of misconduct in relation to the awarding of a contract to provide deep-cleaning and sanitisation services to KM Mashigo Trading CC, Omphile Turnkey & Solutions (Pty) Ltd, Mizana Trading and Triple SL Tech CC. The companies were allowed to inflate prices.
Even more damning is a report complied by Kunene Ramapala Incorporated. The City of Joburg’s legal department appointed it to investigate the claims of whistle-blowers who initially flagged the misconduct.
The Kunene Ramapala Incorporated report, which has been leaked to IOL, found that the companies appointed had no experience in deep cleaning and sanitising. Two of them shared the same address.
Mizana Trading was paid R7 481 151 for services despite not submitting quotes for the tender or being awarded the contract.
The companies that were awarded the contracts for the cleaning and sanitising services had operated in construction, design, space planning, architecture and security.
Those who blew the whistle on the alleged irregularities believe that there were cleaning companies with far more experience and knowledge that could have been used, and the awarding of the contracts was for self-enrichment.
Botes and Bhamjee were suspended by the previous JPC board, in September 2020, in light of the allegations against them.
However, much to the horror ofJPC employees, the new board which took over in February 2021, last week wrote to the City of Joburg informing it of its intended decision to lift Botes and Bhamjee’s suspension.
According to the SIU, its investigation into the Covid-19 procurement at the JPC was finalised and would be submitted to Ramaphosa.
The investigation found that evidence pointed to the fact that, between March 2020 and December 2020, the officials, in awarding the contract to the companies implicated “committed financial misconduct… or alternatively committed gross and serious misconduct, which prejudiced the administration”.
Some of the allegations levelled against the five senior officials:
* They Ignored the JPC Supply Chain Management Compliance Policy and National Treasury instructions on competitive bidding and accepted inflated prices quoted by the service providers. The caused the department to incur fruitless and wasteful expenditure.
* They allowed demand management to process the award to the service providers, knowing that there was no compliance with the supply chain management.
* They allowed the issuing of commitment letter to the service provider without following a fair emergency procurement process.
* They ignored the Disaster Management Act 57 of 2002 and Section 27(2) of the amended Regulations to the Act.
* They failed to ensure the effective, efficient, economical and transparent use of financial and other resources within their area of responsibility as required.
* They failed to take effective and appropriate steps to prevent, within their area of responsibility, any irregular expenditure, as required.
* They failed to take effective and appropriate steps to prevent, within their area of responsibility, any fruitless and wasteful expenditure, as required.
The SIU report was sent the City of the Joburg and the JPC at the end of March.
However on April 23, Moeketsi Rabodila, the new JPC board chairperson, wrote to Mayor Makhubo to inform him that the board had taken a decision at their meeting two days previously to lift the suspensions of Botes and Bhamjee.
In response, Makhubo warned the board against reinstating Botes and Bhamjee.
He asked the board to provide him with answers on whether they had, considered the SIU report, its contents, findings and conclusions and what the implications of the SIU report on their decision would be.
On Wednesday, IOL sent Brink and acting JPC chief executive Ruby Mathang questions related to the SIU report and asked what, if any, action would be taken against those implicated.
City spokesperson Nthatisi Modingoane said: “The City confirms receipt of the SIU report last week. The report has been forward to the delegated MMC for Economic Development portfolio for consideration and to the JPC Board of Directors to exercise its fiduciary duties to act with the necessary skill and care in this matter. The City is… considering the report, before it could determine any possible sanctions in line with all relevant legislations.”
Mathang did not respond to questions at the time of publishing.
The report comes in the wake of a crackdown on irregular expenditure related to South Africa’s fight against the Covid-19 pandemic. The SIU has referred eight cases to the National Prosecuting Authority for prosecution for fraud, corruption and contravention of supply chain policies.
In February, Ramaphosa said the initial findings of the SIU, which had been mandated to probe government’s R30.7 billion procurement during the pandemic, was “horrendous”.
“What is most disturbing is that this was not simply a matter of negligence or poor oversight. There was wilful intent to defraud. As scores of people became ill and many were dying, some people saw an opportunity to cash in.
Ramaphosa said the looting of resources meant for the public cost people’s health and lives.
“That is why all involved in wrongdoing will be dealt with harshly and appropriately. They will not get to enjoy their ill-gotten gains as steps have been taken to recover stolen money, including the freezing of bank accounts.”
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