Johannesburg - Lebogang Seale interviewed some of Zevoli Industrial Supplies’ employees, who painted a disturbing picture of unscrupulous practices by a company they say misrepresented its employees by registering them as its directors to increase its broad-based black economic empowerment rating.
“How best to kill the goose that lays the golden egg and then burn it.”
This is how Lazarus Swarts described his plight after he was allegedly fronted by Danie Scholtz to win lucrative contracts.
“My house and car are at risk of being repossessed. I am struggling to pay for my children’s school fees and provide for their needs.
“Yet I have a share certificate with this company I helped get so many contracts,” Swarts said.
He joined Zevoli Industrial Supplies in 2007 and quickly worked his way up until he became a supervisor. The following year, he was appointed as a director with a 10 percent stake in the company.
“He (Scholtz) said I would be the director in charge of marketing.
“He promised to pay some of my dividends after three years, and the rest thereafter.
“I got nothing,” Swarts claimed.
He said his problems started in 2012, when he started enquiring about the company’s finances and his shares.
This was after he received a call from the South African Revenue Service stating that Zevoli owed more than R300 000 in tax.
“As the company’s proxy, I received calls from Sars about the company owing tax.
“I also asked why the company was growing while we, the employees, were not,” he said, adding that he started receiving traffic fines of vehicles he didn’t know about.
“I approached the Ekurhuleni traffic department, who pointed out some luxury vehicles registered in the company’s name.
“After I asked him (Scholtz) about it, I realised that he had removed my name from the company’s list of directors.”
Swarts said he was still struggling to accept his situation as he was among the employees who helped Zevoli to win many contracts.
“My situation became so bad that I even sold some of my household goods.
“It pains me seeing this man making money while he has disadvantaged a lot of companies with proper triple BEE status.
“There was a time when I contemplated committing suicide.”
Scholtz reacted angrily: “Lazarus was a shareholder. After seven years, he tells lies. We bought him a car and a house for R800 000. How can you say that is fronting?”
But Swarts laughed off Scholtz’s statements, saying Scholtz had agreed to pay the bond of his (Swarts’s) house as “compensation” because it was used as storage for Zevoli’s heavy-duty machinery, including trailers and trucks.
With regard to the car, Swarts said he had an agreement with the company to deduct the monthly premium as there was no stable payment date. This was to avoid debit orders from bouncing.
When Hazel Mphuti, 43, was told she would be a director in Scholtz’s new company, she thought her meagre wages and poverty would be a thing of the past.
She was a sales representatives with a gross salary of R5 000 at Zevoli Industrial Supplies, and so she thought a 50 percent stake in the company’s subsidiary company, Zevoli Industrial Cleaning, would yield enough income.
“He (Scholtz) called me while sitting at a lapa at his workplace and said ‘I’m going to make you a director of a new company I’m starting.’
“He said I will own equal shares with his wife (Suzanne Scholtz).
“I was excited, hoping that it would change my life,” said the mother-of-three.
Today, Mphuti has nothing to show, except her certificate of shares.
She still lives in her parents’ four-room house in Katlehong, Ekurhuleni, with all the hope of a better life dashed.
For a little while after her appointment in 2012, everything looked promising for Mphuti.
If she wasn’t thinking about juggling her frequent trips to various offices of Eskom and the SAPS in the Vaal and Middelburg, Mpumalanga, or submitting tender documents, she was inundated with phone calls from clients asking for quotations and confirming notices of orders for supplies.
The more business flourished, the more Scholtz wanted. Or so it seemed.
“One day when I was submitting documents in Vereeniging, he said to me ‘you must open your legs’ to procurement officers.
“I was scared to speak up because I didn’t want to lose my job,” Mphuti said.
Things took a turn for the worse when she fell pregnant.
“He told me to stop working, saying I was not coping. He later told me that he had terminated my contract.
“I feel bad because I was using my car for travelling and he only paid me R5 000 and said my petrol allowance was R2 000. I feel used.”
Even after her dismissal, Mphuti said she kept receiving phone calls from various clients asking for quotations and telling her that they had sent orders for supplies of various materials and other services.
“I am hurting a lot. I registered my house as surety and I am scared that it might be taken away,” she said.
Mphuti added that she now works as a tea lady at a Randburg firm.
Scholtz had initially said: “Hazel was part of (the company), but she resigned. I don’t know, but she was never part of the company.”
When Jeffrey Twala, 64, retired, he hoped it would mark the beginning of reaping the rewards of hard work and shareholding at Zevoli Industrial Supplies.
Scholtz, the company owner, had apparently assured him that he would get his dividends for his 30 percent stake when he retired.
“I became a director in 2007. He gave me a certificate (of shares) and told me that when I go on pension, I will get my shares,” said Twala, of Sebokeng, south of Joburg.
“I was excited because I have seen some of my friends retiring without any pension benefits, so I thought I would be better off because of my shares.”
But hope has turned into despair for Twala. He was retrenched in 2012 and is yet to receive his dividends.
“'He (Scholtz) said I must sign a letter saying my contract has expired. I feel so cheated. I live in a four-room house and survive on a government pension grant.”
Scholtz’s message to Twala was terse and crude: “He will get nothing because he was never a shareholder.
“If he comes to you with that story, then it is bulls**t He must f**k off.”
Clients have their say about Zevoli
The Star also asked some of Zevoli’s clients about their dealings with the company and their comment on allegations of fronting. Here are their e-mailed replies
“For the period starting from July 9. 2010 to August 13, 2014, Eskom awarded 12 contracts totalling R55 million to Zevoli Industrial Supplies for general cleaning and catering services.
“Eskom has no new contracts with Zevoli.
“Regarding the allegations of fronting, Eskom will first have to do a thorough investigation on the matter, and given the number of contracts involved, this process might take a while.” - Spokesman Khulu Phasiwe
“ArcelorMittal South Africa cannot comment on the merits of this case. However, we view any allegations of fronting by our suppliers in a serious light.
“As a company that is committed to transforming our supply chain, we will investigate the facts and take the necessary steps, as required by our procurement policies and procedures.” - Spokeswoman Kesebone Maema
Did not respond.
“Zevoli Industrial Supplies has been conducting business with the Department of Defence from 2009 to date.
“It is registered as a general supplier, rendering goods and services ranging from the supply of electrical supplies to fixing toilets and toilet perfumes.
“The company was awarded more than 10 contracts since 2009, amounting to the value of R2 315 310.02.” - Spokesman Xolani Mabanga
Department of Correctional Services
“According to Department of Correctional Services (DCS) records, the said supplierwas awarded contracts byDCS Gauteng and Free State/Northern Cape regions (amounting to) R289 710 and R333 984 (respectively).” – Spokesman Manelisi Wolela
“The company in question was never awarded any tender by Johannesburg Water.
“However, there were instances when Johannesburg Water issued purchaseorders to Zevoli to supply consumables on a three-quotation basis.
“Zevoli is registered on our vendor database.
“Various purchase orders were placed with Zevoli between 2006 and 2012 to a value of about R300 000.” – Spokesman David Sibiya.
“Rand Water has engaged with Zevoli Industrial Supplies from 2007.
“The organisation cannot divulge specific information relating to the nature of work between the two parties.” – Spokesman Justice Mohale