Press statement by Solly Msimanga
Executive Mayor of Tshwane

Forensic report uncovers millions siphoned by former administration through former Speaker’s Office

27 July 2017
Release: immediate

The DA-led Tshwane administration has uncovered that over R10 million worth of invoices submitted to the former Office of the Speaker for “work” done during the period 2014, 2015 and 2016 could not be corroborated nor was there justification for the payments.

This follows detailed investigation by an independent forensic service provider which was appointed to conduct forensic investigations into various invoices submitted by suppliers claiming to have rendered services or supplied goods to the Office of the then Office of the Speaker but were not paid.

The report, which served at the City’s monthly council sitting detailed how the suppliers collectively claimed that a total of R28 172 203 was due to them. However, the investigation revealed serious transgressions of supply chain management processes as well as cases of possible fraud within the Office of the Speaker. There were also solid indications that some suppliers had submitted invoices for work not done.

In order to satisfy itself, the current administration requested the verification of invoices and determination of whether work was done be conducted prior to invoices being paid.

Based on the review of documentation provided to the investigators as well as consultations conducted with the service providers, it was established that of the of R28 172 203, only R11 372 255 could be verified and that the latter amount will be paid to eligible service providers.

Executive Mayor of Tshwane, Cllr Solly Msimanga noted the findings of the report as proof of the extensive corruption that characterised the previous administration. “It is clear that rampant theft and fraud reigned supreme under the watch of the former mayor and speaker. Tshwane residents have been robbed of monies running into millions of rands which could have been used for the socio-economic development of the City and to create much needed employment opportunities”.

“Tax-payers’ money went into the pockets of the connected elite who had no regard of the financial implications their actions were placing on the City and its people. Officials have a duty to use the resources of the municipality in the best interest of the local community but they chose not to. It is as disappointing as it is unsurprising”.

Some of the damning findings include:

·         That certain entities did not exist but they had submitted quotations. The quotations were in fact intended to be cover quotes.

·         Some invoices were proved to be for services rendered in respect ANC rallies including the erection of R114 000.00 tombstones for individuals who were in the “struggle” in various political organisations yet this could not be verified.

·         Striking similarities in various quotations and invoices that suggested that entities were either colluding or belonged to the same owners when submitting quotations.

·         Background searches on the entities that submitted invoices determined that most of the members of the entities owned more than one entity. In this regard, members owned various entities that submitted invoices to the Office of the Speaker.

·         Some of the suppliers had been paid for services rendered in other departments within the City of Tshwane.

·         The Office of the Speaker had limited supporting documentation and reliance placed on documentation provided by suppliers in supporting the fact that services were rendered.

·         Officials who were involved in the procurement process, in most instances they did not have records such as request for quotations and receipt some delivery notes.

·         Some of the invoices submitted did not appear to be related to core work within the Office of the Speaker.

·         The report identified that various items claimed for by service providers were inflated.

Among some of the recommendations approved by council; the City will now initiate steps to ensure that companies/persons found to have defrauded the City barred from future business relations with the City of Tshwane; that National Treasury blacklists companies/persons on the E-procurement data base that have defrauded the City and that the Speaker of Council and/or the City Manager institute legal action with regard to wrong doing based on the findings of the Forensic Audi.

By the introduction of an open-bid adjudication process, the City of Tshwane will ensure that business done with the city is fair and free from corruption as part of our commitment to being an open and transparent government.

Media enquiries:

Samkelo Mgobozi
Spokesperson to the Executive Mayor of Tshwane
078 231 5977