Tender fraud accused tell of ‘inflated and unreasonable’ prices

2011-09-30 00:00

TWO men charged with corruption in the tenders for water purification plants at hospitals in KwaZulu-Natal yesterday entered into a plea bargain — admitting that the prices quoted for the plants were “inflated and unreasonable”.

Ansano Romani (64) and Donald Keith Miller (58), managers of Imvusa Stainless cc, will be testifying against the 17 other accused.

The accused include KwaZulu-Natal Legislature speaker Peggy Nkonyeni, Economic Development MEC Mike Mabuyakhulu, Uruguayan businessman Gaston Savoi, former Ithala Bank CEO Sipho Shabalala, former heads of the Health Department Busi Nyembezi and Yoliswa Mbhele, chief financial officer of the legislature Alson Sipho Buthelezi, Victor Ntshangase and advocate Sandile Khuboni.

In their plea statement Romani and Miller told the court that they met Savoi and Fernando Praderi of Intaka Holdings at Steenberg Wine Estate in 2004.

Romani and Miller were working for Grotto Defranceshi Company, which was manufacturing components for water purification plants for Intaka Holdings.

They said that earlier that year Savoi and Prederi informed Romani on behalf of Intaka Holdings that they had business dealings with the South African government and that water purification plants were of prime importance.

In 2006 Praderi told Romani that Intaka had negotiated an order with the KZN MEC for health and the head of the Health Department for two water purification plants at Appelsboch and Rietviei hospitals.

He gave the health officials the contact details of Imvusa Stainless cc and Westpro for them to get two more quotes for water purification plants.

Praderi asked Romani to communicate to Miller — who was then working for Imvusa Stainless cc — and Ronald Geddes of Westpro that the KZN Health Department required two more quotes.

Miller and Geddes agreed to provide the two cover quotes and to write up two templates for whatever type of water purification plants were different to those of Intaka.

“Fernando Praderi informed Romani to put a R5 million to R6 million price range on the template.

“The price range put on the template was unreasonable and inflated for an Intaka-type water plant, but not for the plant that Imvusa Stainless cc would be offering.

The price range quoted for the Intaka-type plant if fully installed should be in the range of R2 million,” said Miller.

Romani and Miller knew Savoi and Praderi would supply the particulars of Westpro and Imvusa Stainless as well as their names and that of Geddes as contact persons to the head of the department.

They said that according to an e-mail received on September 27, 2006, requesting quotations for the water purification plant, the head of department was named on the bottom of the e-mail as Dr B.M. Nyembezi.

Romani and Miller admitted that this misrepresentation caused the health department to suffer prejudice. The department awarded the tender of R9 960 000 to Intaka.

The pair were fined R100 000 or eight years’ imprisonment, with half suspended for five years on condition that they are not convicted of fraud, theft, forgery or any other offence involving dishonesty.

Circumstances that justified deviation from the mandatory minimum sentence were that they don’t have previous convictions and that they are extremely remorseful.

National Prosecution Authority spokesperson Mthunzi Mhaga said, “It is clear that we are fighting corruption. The case is strengthening for the state as they will testify against the accused.”

Mhaga said the investigations are continuing even though the trial is in January and that even more arrests are imminent.


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