JOHANNESBURG - The embattled South African Municipal Workers' Union (Samwu) on Wednesday admitted that the workers' coffers had been plundered almost R88 million in just three years, but dismissed reports that it only had less than R1 000 in the bank currently.
Reports emerged this week that a damning forensic investigation revealed that millions of rands put aside to keep food on the tables of Samwu's striking members were redirected to cover some of the union's operational costs and to buy T-shirts.
The forensic investigation into five allegations of misappropriation and irregularities of the union's finances was conducted by accounting firm Ernst & Young (EY) in 2016, but was kept under lock and key until recently.
In a statement from its secretariat, Samwu - whose top officials were currently holding a special central executive committee (CEC) meeting this week - said the auditors have confirmed that the union had eight bank accounts in 2012, some of them unknown by its top officials.
The union said the bank accounts had a combined balance of just more than R94.5 million by 3 November 2015, but this had drastically decreased and the union's bank balance was over R6.2 million, and not the R538 which has been widely reported in the media.
"The auditors have found evidence of irregularities and fraudulent activities that have contributed to the drastic decline in the union's bank balances," it said.
"They have further highlighted that the decline in bank balances was compounded by the fact that the union was spending more than it received in terms of member subscriptions, noting that the union does not have any other revenue generating stream and thus relies solely on what is received from municipalities."
Samwu laid the blame squarely at the feet of its former president, Pule Molalenyane, whom it accused of concealing crucial information about the union's operations from is officials.
"Ernst & Young completed the audit and presented the audit report to the union's former president, Pule Molalenyane. This report, however, was never presented to any of the union’s structures," the union said.
"According to Ernst & Young, Molalenyane is the only person who had access to the report, a report which was later leaked to the public."
Samwu also said that the auditors have recommended that the union establish a panel of legal firms to avoid paying astronomical fees to lawyers.
The union has paid more than R120 million to law firms since 2012.