Court told of inflated commission for MIB House

2013-03-15 00:00

THE fraud and corruption trial of former uMgungundlovu district councillors Lucky Moloi and Alpha Shelembe yesterday heard evidence about how the price negotiated for a building was increased.

State witness Gavin Breetzke, one of the sellers of the MIB building in Langalibalele Street to the district municipality in 2003, told the court that the asking price for the building was R6,5 million from the outset, including R500 000 as commission.

Later, the estate agent who negotiated the deal, Neville Watts, told him he needed a commission of R650 000 or 10% of the price.

Breetzke alleged that during a subsequent meeting attended by some municipal officials on August 11, 2003, Moloi had “mentioned” to him that “their” commission had been increased by a further R200 000 and that the price had risen to R6,85 million.

He said under cross-examination that he had no knowledge about an asking price of R7,15 million for the building, as alleged by the defence.

In a statement to court, Moloi said he had been appointed to a task team to negotiate the sale price of MIB House, instead of a Telkom building that had initially been identified as suitable.

He said he had attended a meeting with other task team members on August 7, 2003 at which representatives of the sellers had “suggested a sale price in the region of R7 million”.

“A compromise figure of R6,85 million was put forward as a sale price,” said Moloi.

The prosecution alleges that Moloi, Shelembe and the late Themba Zungu used their influence as councillors to persuade the municipality to buy the MIB building rather than the Telkom building at an inflated price.

It also alleges that they benefited illegally by being paid commissions.

The case has been adjourned to April 22 for further evidence.

Also on trial in the case are Shelembe’s wife, Joyful, and his sister, Nelisiwe, as well as a former bodyguard, Thembinkosi Xaba, who faces charges of money laundering. They too have pleaded not guilty.

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