Corruption snapshots: 2013 so far …

By Kavisha Pillay

It’s tough to keep up with the scandals continually staining our rainbow nation, so to make the task that much more manageable, Corruption Watch has drawn up a timeline of events. It’s quick and easy to check progress on graft cases, and catch up on new corruption stories. Like a one-stop shop, it keeps you up to date on what’s happening, gathering data from a variety of sources in one place. If you feel we’ve missed out on a specific case, let us know via Facebook or Twitter (@Corruption_SA), or email KavishaP@corruptionwatch.org.za.

JANUARY

Vivian Reddy 18 January

The Mail & Guardian publishes an exposé highlighting manipulation in the tender awarding processes which directly benefitted Vivian Reddy’s company, Edison Power.

• Reddy is a close friend of President Jacob Zuma and secured a tender from the city of Joburg worth R1.25-billion.
• On January 12, at the ANC’s 101-year celebrations – a week before Reddy landed the tender – Zuma controversially said that businessmen who backed the ANC would see their businesses "multiply".
• An opposing bidder, Hefcom, was pushed below the cut-off per-cent technical score and when prices were compared, Hefcom’s bid was half the cost of Edison Power’s bid.
• The public protector confirmed in February that she would investigate.

Public Works 21 January

The Department of Public Works confirms it spent R65-million of its annual budget on upgrading 27 ministerial homes in Cape Town and Pretoria in the 2011-2012 financial years. Analysis of the costs includes:

• R15m spent on a house allocated to the rural development minister, Gugile Nkwinti;
•  R10.67m to renovate a house allocated to the deputy minister of transport, Lydia Chikunga; and
• Less than R5m to upgrade the house of agriculture minister, Tina Joemat-Pettersson.
• The Special Investigating Unit (SIU) is looking into 40 cases relating to irregular leases and projects, of which 23 have been resolved.
• In May, Minister Thulas Nxesi said that renovations to 11 ministerial homes in Cape Town had amounted to about R100m, and therefore the department would be extending its investigation.

North West legal fees 25 January

The North West’s standing committee on public accounts (Scopa) announces that it will probe the alleged misuse of state funds on legal fees.

• Chairman Hlomane Chauke said the probe would focus on the misuse of state funds by the former finance MEC, Louisa Mabe, current MEC Paul Sebegoe, and acting finance department head Geo Paul.
• The three failed to give the committee a clear account of procurement processes followed in appointing Morake Attorneys, which was paid over R15.4-million for a disciplinary hearing.
• The Hawks, the auditor-general’s office, the public service commission and the public protector were to conduct the investigation.
• On 28 May, Scopa received a preliminary report from the public protector’s office on the investigations into the R15m spent on legal fees by the provincial department of finance.
• The public protector’s office asked Scopa not to make the contents of the report public until it was finalised and all those involved had been given a chance to view the document and give inputs.

Nkandla 27 January

Minister of Public Works Thulas Nxesi confirms that R206-million of taxpayers’ money was spent on upgrades of the President’s private Nkandla homestead.

• In November 2012, a task team was established by the Department of Public Works to investigate the upgrades to Nkandla.
• The investigation highlighted a range of irregularities that could have inflated the price by millions of rands.
• Nxesi announced that Nkandla was listed as a national key point, so the findings of the report could not be made public for security reasons.
• The report has been handed to the SIU, the auditor-general, the public protector and the South African Police Service to investigate any misconduct.

Mvula Trust 29 January

In 2012, Corruption Watch is approached by a whistleblower who alleges that rural development NGO Mvula Trust has obtained a government tender irregularly.

• The tender formed part of the job creation initiative of the Department of Co-operative Governance and Traditional Affairs (Cogta), called the Community Work Programme (CWP).
• In late March, Cogta minister, Richard Baloyi, finally acknowledged that all was not right with Mvula Trust and the  multibillion-rand CWP, and announced that a full-scale investigation would be undertaken by his department.
• A company subcontracted by Mvula Trust illegally to implement a leading programme that would fight poverty and create jobs is threatening to pull out of the CWP, which could result in thousands of people losing their jobs.
• In May, CW was given permission to make written submissions to an enquiry initiated by Cogta to investigate further a number of allegations of illegality and complaints about the CWP.

“Mrs M” 30 January

Public Protector Thuli Madonsela finds there is maladministration in the Justice Department regarding the treatment of a whistleblower.

• Madonsela said Mrs M approached her office in 2010 saying she was victimised and harassed in the first few months of her employment after she discovered that fellow employees were misappropriating funds.
• Corrupt officials began to harass Mrs M soon after her discovery and two years into her job she suffered occupational stress as a result of the victimisation.
• Doctors said she should be transferred to another office in the department but this was not done and in March 2012 the department stopped paying Mrs M’s salary.
• There was a conciliation, together with officials from the office of the public protector, and it was agreed that she should be reinstated.
• But she was not reinstated and the department denied it had agreed to do so.
• On 30 January, the director-general of the department agreed to reinstate Mrs M and to move her to another unit.

FEBRUARY

Shauwn Mpisane 6 February

Durban businesswoman Shauwn Mpisane is arrested and her assets are seized after she is found guilty of forging false documents to secure government tenders worth R140-million from the Department of Public Works.

• Mpisane, who has a 2005 conviction for VAT fraud, is facing 53 charges of fraud, forgery and uttering.
• From September 2005 to September 2012, Mpisane, or people acting on her behalf, submitted falsified documents  to the department for various construction projects.
• Despite the charges against her, Mpisane was awarded a tender in April worth R455-million by the city of eThekwini.
• Mpisane’s trial began in May and the South African Revenue Services (SARS) was granted permission to seize five properties belonging to the businesswoman worth R13.9-million.

Phil Setshedi 12 February

Former Orlando Pirates soccer club manager, Phil Setshedi, is sentenced to three years imprisonment for corruption.

• Setshedi was convicted of paying a police official (posing as the chief referee) R2 000 to fix soccer matches in the Vodacom soccer tournament in June 2011.

Lulu Xingwana 17 February

Minister of Women, Children and People with Disabilities Lulu Xingwana reportedly splurges R2.1-million of taxpayers’ money on new furniture for her office.

• According to a report by Fluxman Attorneys, almost half of the money was used to overhaul the minister’s office with custom-made furniture, with Xingwana allegedly spending close to R500 000 on two occasions with two suppliers.
• The Sunday Independent reported to have seen documents detailing 11 purchases of furniture, crockery, cutlery and kitchen appliances and according to the document, in at least five of the 11 purchases, officials deviated from the supply chain procedures and did not get quotes from three suppliers before making the purchase.
• The report also alleged that an official was paid R180 000 for working overtime, bursaries worth thousands of rand were awarded with no evidence of a repayment agreement, and a nurse was appointed to the position of director over someone more qualified.

MARCH

Miriam Segabutla 2 March

The former health and social services MEC in Limpopo, Miriam Segabutla, is released on R15 000 bail after she is found guilty of tender fraud amounting to R15-million.

• Segabutla was arrested following the awarding of tenders to companies that were closely linked to her.
• The public protector investigated and found that she created a conflict of interest between her official responsibilities and private interests.
• The ANC called on Segabutla to not participate in any of the ruling party’s structures and the top leaders are yet to decide on how to deal with the issue.
• Segabutla’s court case was postponed to July.

Free State website 6 March

The Free State provincial government splurges R40-million of its budget on developing a website. The province will determine whether it received value for money in the website deal, says Premier Ace Magashule, but the story is aggravated when he is accused of channelling millions of state rands to the same company that built the online platform.

• Patricia Kopane, leader of the Democratic Alliance (DA) in the Free State, told the Mail & Guardian: “We are in possession of proof dating back to 2009 showing blatant corruption between the premier’s office and this company.”
• According to allegations, the Letlaka Group – which benefitted from the website – was paid tens of millions of rands for work that was not properly put out to tender.
• Chief among the claims were:

1. Payment of R2.6m for the management of the premier’s 2009 State of the Province address;
2. A R4.175m advertising contract awarded to the weekly newspaper allegedly owned and run by Letlaka, without going to tender;
3. Landing a R300 000 monthly contract for the printing and distribution of government marketing material; and
4. Receiving R12m annually for Hlasela TV, which Letlaka manages and broadcasts to 100 public buildings and institutions in Free State. In spite of several attempts made telephonically, via SMS and email, Magashule’s spokesperson, Oupa Khoabane, did not respond to calls for comment.

John Block trial 7 March

Northern Cape’s ANC chairperson and finance MEC, John Block, as well as other leading figures in the province including MP Yolanda Botha, social development MEC Alwin Botes, and Trifecta company director Alfeus Scholtz face multiple criminal charges, ranging from corruption to fraud and money laundering involving R48-million.

• The charges relate to the purchasing of a portable water purification unit at inflated prices.
• Despite the corruption charges, Block was re-elected chairperson and the Northern Cape ANC. The party confirmed that it would not suspend Block even though there was an existing amendment in its constitution that members who were being criminally charged must be suspended until the court case had been concluded.
• Block and his co-accused appeared in court in March 2013 and a trial date was set for 28 October 2013.

DPW Pretoria head office upgrades 7 March

The Department of Public Works pays more than five times the price originally quoted for renovations to its Pretoria head office.

• Public Works Minister Thulas Nxesi said the renovations were initially estimated at R59-million but the department ended up paying R325m on completion.
• A deputy director-general was dismissed, while a former acting director-general and head of property management face disciplinary action.
• The SIU investigation found that R27m had been spent on renovations, with R4.7m paid to suppliers without supporting documents.
• It also found that bills of quantity were excessively inflated and supply chain prescripts were not complied with in appointing service providers.

Tina Joemat-Pettersson 14 March

President Zuma slaps Agriculture, Forestry and Fisheries Minister Tina Joemat-Pettersson on the wrist for spending R1.6-million of public funds on lengthy stays at lavish hotels.

• Public Protector Thuli Madonsela last year found Joemat-Pettersson guilty of breaching the executive ethics code by spending more than R420 000 at a Johannesburg guesthouse during the soccer World Cup in 2010 and another R151 000 of taxpayers’ money to fly her children home from a holiday in Sweden, among other transgressions.
• Zuma’s reprimand followed a recommendation by Madonsela that he take action against her.
• “I had an opportunity to engage with Minister Joemat-Pettersson on the findings of the public protector. After careful consideration of the public protector's findings on the matter, as well as Minister Joemat-Pettersson’s submission on the matter, I have reprimanded [her] for her violation of the executive ethics code,” Zuma wrote in his letter to National Assembly Speaker Max Sisulu.

EC deputy Speaker fraud charges 29 March

The Eastern Cape High Court in Grahamstown hears that the fraud trial against the former deputy Speaker, Neo Moerane, and her former husband, Max Mamase, is ready to proceed.

• The charges involved allegations that she and her ex-husband, a former Eastern Cape agriculture MEC, took kickbacks from a citrus farmer for landing him a R16-million empowerment deal via the agriculture department.
• The charges against Mamase and Moerane were provisionally withdrawn in 2009 when the National Director of Public Prosecutions (NDPP) lost a technical point on whether or not the Eastern Cape High Court in Bhisho had jurisdiction to hear the criminal case as the alleged crimes had happened across multiple jurisdictions.
• Moerane claimed she was advised by the ANC to resign as provincial deputy Speaker because of the charges hanging over her head.
• The National Prosecuting Authority (NPA) stated that the new indictment against Moerane and Mamase had been finalised and the trial was ready to proceed.

Social grant fraud 22 March

Pretoria News reports that the re-registration for social grants by the Department of Social Development has uncovered massive fraud involving nearly R60-million and only R1.1m has been recovered.

• According to figures released by the South African Social Security Agency chief executive, Virginia Petersen, many agency staff members faced disciplinary action for their roles in grant fraud, which involved just over R59m.
• 52 employees were suspended and 25 dismissed, while seven were fired before or during disciplinary proceedings.
• In one instance, a number of employees were arrested for being in possession of 127 unregistered social security cards, R37 000 in cash and Cash Paymaster Services machines, used to dispense the grants.

April

Dr JS Moroka contract 12 April

A procurement officer employed at Dr JS Moroka local municipality in Mpumalanga is under investigation following a Corruption Watch investigation that exposed an irregular awarding of a contract  at an inflated price to her husband.

• The whistleblower, Greg Dinwoodie, is an accounting officer for Selectech, a laboratory equipment company in Johannesburg that supplied special glass vials to test drinking water to JS Moroka for over a year.
• In October 2012, Dinwoodie received a strange email that included an official purchasing order invoice for a set of 12 vials, valued at R24 000. His company had supplied the same equipment for some time to the municipality, for only R2 000 per set.
• The email was meant to be between the municipality and another company, Sinqobile & Jose, but was sent to Dinwoodie by mistake by an official at the municipality. He immediately reported the matter to CW.
• CW discovered that the procurement officer who signed off on the R24 000 payment to Sinqobile & Jose was Rabelani Thukwana. She was married to Sipho Thukwana, registered as the owner of Sinqobile & Jose.
• As a result of the CW investigation, three officials were suspended.

Dina Pule 22 April

In 2012, a Sunday Times investigation exposes shady dealings at the ICT Indaba, alleging that Communications Minister Dina Pule leaned on telecommunications companies to sponsor the event from which Phosa Mngqibisa, with whom she has a supposed romantic link, earns R6-million for four days’ worth of work.

• Sponsorship funds amounting to R25.7m disappeared and were mismanaged.
• The newspaper also claimed that Pule spent R2.6m on a recruitment deal that led to the appointment of individuals, all of whom had a private relationship with Mngqibisa, to key government parastatals.
• Pule hit back at the newspaper, claiming she was the victim of a vicious smear campaign.
• In May, following a request from the DA, the SAPS agreed to launch an official investigation into Pule.
• An ethics committee hearing into Pule’s conduct began in Parliament on 3 May.
• In mid-May, the Sunday Times made further claims that she blew more than R700 000 taking her boyfriend, Mngqibisa, her personal assistant and her deputy director-general on a trip to Mexico and New York, where they stayed in the luxurious Ritz-Carlton Central Park and were ferried around in luxury cars hired from a limousine service.

PetroSA 26 April

The Hawks confirm they are investigating financial misconduct in the state oil company, PetroSA.

• The Mail & Guardian reported that managers at PetroSA ordered irregular payments of R200-million and risked an additional R800m in potential liabilities.
•  The allegations against PetroSA came after it bought Sabre Oil & Gas Holdings, which is involved in prospecting in the Jubilee oil fields in Ghana.
• Several “negotiators” involved in the deal are also being investigated for allegedly receiving multimillion-rand kickbacks.
• As a result of an investigation into procurement processes at PetroSA ordered by the minister of energy, the chairman, Benny Mokaba, vacated his position.

• Six PetroSA officials are under observation by the Hawks’ crimes against the state unit and Interpol.
• The passports of several senior PetroSA executives have been flagged and their bank accounts are being monitored.
• In May, the newspaper noted that George Sabelo, the lawyer at the centre of the R1-billion scandal, received millions of rands not due to him – suggesting that kickbacks were paid.

Gupta jet at Waterkloof 30 April

Eyewitness News breaks the story that a private jet chartered by the Gupta family carrying over 200 wedding guests landed at the Waterkloof Air Force Base without following normal procedures.

• There were 50 vehicles to transport the guests to Sun City Resort and Casino. The vehicles were divided into four convoys of 15 vehicles each, with one police vehicle to lead the convoy and one traffic vehicle at the rear. Members of the SAPS Flying Squad were also available outside the airbase.
• Eleven metro cops are believed to have fitted blue lights and false number plates to their private vehicles to escort guests to Sun City.
• Chief of state protocol Bruce Koloane was suspended for his involvement in clearing the landing for the private plane. Koloane was also said to have name-dropped to secure the landing clearance, saying that he was under pressure from “Number 1”. Justice Minister Jeff Radebe said Koloane and Lieutenant-Colonel Christine Anderson manipulated processes and “shared a common purpose and acted in concert”.
• CW’s executive director, David Lewis, said Radebe’s proposal that a public service campaign be introduced to discourage a “negative culture of name dropping” overlooked the real issues. “To refer to what has happened here as ‘name dropping’ is to trivialise a major administrative breakdown, and the doings of a family who clearly are capable of commanding extraordinary privilege based on their relationships with senior public figures, clearly including the president,” Lewis said.

May

Border policeman 7 May

The Hawks reports that nine police officers have been arrested, along with seven other people for fraud and corruption at the Caledonspoort border post in the Free State.

• The officials allegedly allowed people to enter the country from Lesotho without documents and charged them R150 each.
• Spokesman Captain Paul Ramaloko said of the seven, six were immigration officers and one an official from the Health Department.
• The officials were able to make over R100 000 a day, and in one instance they shared R200 000.

Groenpunt correctional facility 31 May

A prisoner blows the whistle on an elaborate smuggling ring involving prison warders and inmates.

• The prisoner exposed details of bribery between inmates and prison warders to smuggle items such as cellphones, drugs, ATM cards and food into the prison.
• “We send them to get us anything we want; some of our ATM cards are in their possession. So when I need money I send a warder to the bank to withdraw and I give him a certain amount to make sure he continues to run the errands for me,” said the inmate.

Manase Report 31 May

A forensic audit report by Manase and Associates into the eThekwini municipality remains confidential with only a brief summary released in early 2012. Although KwaZulu-Natal MEC for co-operative governance and traditional affairs Nomusa Dube said in May the report would be made public "soon", only a progress report on disciplinary processes that emanated from the report's findings was shared in council.

• The full report confirmed allegations of extensive irregularities involving the contravention of tender processes, lack of budgetary controls, and employees as well as councillors doing business with the municipality.
• The forensic audit was ordered after auditor-general Terence Nombembe said in his 2009-2010 report that R532-million had been spent irregularly by the municipality.
• The report was said to implicate senior eThekwini councillors and their families, municipal managers and senior politicians in alleged corruption involving billions of rands.
• In May, the DA applied under the Promotion of Access to Information Act to have the report released in full. The party gave city manager Sbu Sithole 31 days to make the report available or say why it could not be released. The party plans to take the municipality to court if it is not released.

June

SAPS R500m police lease deal 3 June

The police lease deal that led to the sacking of former police commissioner Bheki Cele lands another public servant in hot water.

• Sam Vukela, a senior Department of Public Works official who awarded a R500m lease deal to property mogul Roux Shabangu following a 10-minute meeting with the police, was found guilty.
• Vukela awarded the deal to Shabangu on 14 May 2010 after he met Lieutenant-General Hamilton Hlela, where the need for police accommodation and parking was discussed.
• An internal public works hearing found Vukela guilty on three counts of financial misconduct.
• The hearing also heard that Vukela placed considerable pressure on members of the Special National Bid Adjudication Committee to fast-track the tender process and to conclude the lease agreement with Shabangu.