KZN caterers cook up multi-million rand tender fraud

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Durban – A well-known Durban catering contractor had her palatial La Lucia home, nearby boutique hotel, both with sea views, and a Harley Davidson motorbike restrained by the National Prosecuting Authority’s (NPA) Asset Forfeiture Unit (AFU) this week.

Ntombimpela Mabel Majozi of Nto’s Catering CC is among the 16 accused in a R24-million fraud matter related to catering tenders that were allegedly awarded in a dubious manner by officials and employees at the KZN’S Office of The Premier (OTP), who colluded with service providers.

Nto’s Catering is one among four companies that allegedly received preferential treatment from the OTP, according to an audit report released in August 2017.

The company was also the preferred caterer for VIP events and the report showed that between 2013 and 2016 the company was awarded 59 orders worth nearly R8m.

This translated into nearly one order a month, on some occasions, more than one, and often the work was around the province, while other local service providers were overlooked.

The report was commissioned by KZN’S Treasury department after receiving a whistleblower’s letter that raised allegations of irregularities in the supply chain management (SCM) of the OTP.

Integrity Forensic Solutions (IFS) were appointed to examine the veracity of the allegations.

The AFU swoop, on Tuesday morning, which was rubber stamped by the Pietermaritzburg High Court, related to a criminal matter that is being handled by the Durban Specialised Commercial Crimes Court.

It attached items valued at more than R23m, which included 20 immovable assets and 40 vehicles, all belonging to the accused.

In their report, IFS recommended suspensions of OTP staff, criminal charges and the blacklisting of the implicated companies.

The Hawks investigated the matter and effected arrests in July and October, and tender fraud and corruption charges were raised.

The OTP employees who were arrested included Nonhlanhla Pamela Hlongwa, manager of the department’s Supply Chain Management (SCM), Ziphathe Cibane, the OTP’S chief financial officer, Nomusa Zakwe, Hlongwa’s personal assistant, and administrative clerks Thobelani Makhathini and Sithembiso Msomi.

Catering contractors Majozi, Gugu Kheswa (PMG Events) and Ashley Rose (Roren Engineering CC) was also among those who were arrested.

All were released after bail. According to the report, Cibane and Hlongwa were largely responsible for the irregular tender awards.

Zakwe and Makhathini processed most of the transactions, in disregard of SCM policies, which resulted in awards for the favoured companies.

To eliminate competition, cover quotes were arranged from companies that had OTP employees and the accused service providers listed as directors. In some instances, other quotes were shredded or thrown away.

In an interview with IFS’ investigators, Zakwe and Makhathini said they acted on the instructions of Hlongwa.

Zakwe admitted receiving cash payments from PMG for facilitating the award of orders.

PMG received tenders worth more than R13m for the period of review, which consisted of 31 orders and Roren’s slice of the catering contract pie was R1.2m.

IFS uncovered that Isidleke Enterprises (Pty) Ltd, which was owned by Zakwe’s uncle, who lived with her, received work worth R468 000.

Zakwe controlled the affairs of the company and kept its bank card, but did not declare her involvement to her employers.

The report also highlighted that Cibane had “directly participated in transactions” valued around R13m and, the responsibility for the balance of the irregularly awarded tenders rested with him, given his position.

However, Cibane and Hlongwa jointly lodged a high court application last month and said the IFS report was “flawed” and the remarks and recommendations in it should be set aside.

They asked that their suspensions from their respective positions also be reviewed and set aside, and rebutted the allegations against them.

Cibane deposed an affidavit on behalf of the pair, who made the application in the Pietermaritzburg High Court.

The premier of KZN, his director general and deputy directors-general and IFS are among the six respondents in the matter.

He said their suspensions in January, and extended in March, were not in accordance with provisions in the disciplinary code.

Cibane said they were both senior managers and should have been subjected to disciplinary proceedings within 60 days of their suspension.

That the charge sheets were not served within the 60-day period and that they were not granted the opportunity to make representations as to why they should not be suspended, was another reason why their suspension should be nullified.

Sandile Khoza, a Norton Rose Fulbright director, the legal firm representing IFS, confirmed the application would be challenged.

Lennox Mabaso, Premier Sihle Zikalala’s spokesperson said he could not comment on matters before the court.

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