Intimidation and cover-ups: Inside the confidential City of Cape Town report

2018-01-09 14:44
Cape Town Mayor Patricia de Lille. (Gallo Images)

Cape Town Mayor Patricia de Lille. (Gallo Images)

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Cape Town – A confidential report by independent investigators, into claims of covered up irregularities allegedly by City of Cape Town officials including Mayor Patricia de Lille, has exposed just how badly relationships have deteriorated due to finger pointing and accusations.

The report, dated December 29 and based on an independent investigation by Bowman Gilfillan Attorneys, has not been made public. However, News24 has seen a copy of it.

It has revealed that allegations of irregularities date back several years and that there is severe infighting and mistrust among the City of Cape Town's top tier of officials.

'Damaged relationships'

"Special attention will need to be given to the extent to which the allegations made by [Kesson] and the manner in which they have been prepared and presented by him have damaged relationships within the City administration," a section of the report reads.

It is in apparent reference to a 42-page affidavit by Craig Kesson, the executive director in De Lille’s office, which was made public in November.

Kesson’s affidavit contained shocking allegations against De Lille, including that she planned to publicly discredit a senior City staffer, who questioned alleged tender irregularities, and asked that a report into a possible R43m loss regarding another tender be made to "go away".

READ: 'Bullying' De Lille wanted alleged tender irregularity report to 'go away' - executive director

The Bowman Gilfillan report came about after the council ordered an independent investigation into several allegations against City officials.

De Lille is seeking legal advice on the report, which states that she may be guilty of gross misconduct, as she says it contains factual errors which she pointed out, but which were never rectified.

Scrutiny of De Lille's conduct is set to intensify over the next few days. This coming weekend the DA's federal executive will consider her response as to why she should not resign and it will then advise her on its findings.

De Lille's response relates to a report on findings by what has become known as the "Steenhuisen commission".

A subcommittee, headed by the party's chief whip John Steenhuisen, was previously established by the DA's federal executive to look into political management in the City of Cape Town. It is understood several allegations were made against De Lille.

In December, the DA's federal executive announced she would be suspended from party activities – pending investigations – and that it had asked her to give reasons why she should not resign as mayor.

De Lille had hit back, saying the DA did not have sufficient reason to remove her and that, if the party proceeded with steps to go ahead with a motion of no confidence against her, she would go the legal route to try and prevent this.

Possible suspensions

On Friday, during a confidential council meeting, an investigation into De Lille was ordered because of allegations that she prevented City manager Achmat Ebrahim from reporting to the council allegations against Melissa Whitehead, the commissioner of the transport and urban development authority.

Both Ebrahim and Whitehead were given until this Friday to submit reasons as to why they should not be suspended.

It was decided during Friday's council meeting that Kesson would not face any action.

The Bowman Gilfillan report details several claims and counterclaims between City officials, including Kesson and Ebrahim.

Forensic report 'leaks'

It said Ebrahim had alleged that Kesson violated his employment contract by leaking confidential forensic investigation reports to a political party or member of a political party.

It said Kesson, in a response to the council on November 29, categorically denied leaking forensic reports to the DA.

The Bowman Gilfillan report said: "We did, on the other hand, establish that [De Lille] had in fact provided a copy of certain forensic reports to the DA."

It said Lindiwe Ndaba, the portfolio manager of probity, provided De Lille with a flash drive containing forensic reports of the past five years. Ndaba had faced similar claims as those levelled against Kesson.

"During our interview with the executive mayor on 13 November 2017, she confirmed that she had received the memory stick containing forensic reports from [Ndaba]," the report said.

"She informed us that she provided the forensic reports to the leader of the DA. In this regard the executive mayor undertook to provide us with a submission setting out the background."

This submission, the report said, was not provided to the investigators.

It found there was no evidence to suggest Kesson had unlawfully disclosed confidential reports to a political party.

"On their own versions it appears [Ndaba] provided [De Lille] with a memory stick containing forensic reports of the City," it said.

'Factual errors'

However, De Lille on Friday issued a statement saying apparent facts in the Bowman Gilfillan report about the forensic report were incorrect.

"Amongst those errors was a 'factual finding' that established that I had 'in fact' provided the DA leader with a copy of certain forensic reports," De Lille said.

"They also reported that I had confirmed in my interview with them that I had done so."

But De Lille said in her interview that she told the investigators "I had certainly not provided the DA leader or any other unauthorised persons with copies of any forensic reports".

"I received written confirmation from the leader of the DA that I did not give him or his office the reports," she said.

"This confirms that the Bowman Gilfillan report is based on erroneous facts and findings."

De Lille was seeking legal advice over the issue.

'Misconduct' and 'undisputed fraud'

Kesson had accused Ebrahim of misconduct in that he had failed to ensure the proper implementation of a City contract relating to the services of the MyCiti Integrated Rapid Transport System.

The services had to do with station management, involving a contract with AEM in October 2012.

It also had to do with the supply, delivery, design and installation of the rapid transport system by a consortium headed by ICT Works System (Pty) Ltd.

"ICT Works raised concerns in November 2015 about the possibility that the City had been defrauded by employees and/or others for whom AEM was responsible," the independent report said.

"That such frauds took place does not seem to be disputed."

In a letter dated May 27, 2016, ICT Works estimated that the City incurred a loss, due to fraud carried out between July 1, 2015, and May 13, 2016, to be R16 801 000.

In a November response on this matter to the City council, Ebrahim said he had actioned recommendations resulting from a forensic investigation into the matter.

'Senior officials knew of weaknesses for years'

The independent investigators, according to the Bowman Gilfillan report, found that "control weaknesses" were alluded to and these had allegedly "exposed the City to substantial financial and administrative risks within the MyCiti Smartcard environment".

"It is also alleged that these weaknesses appear to have been known to senior City officials since at least 2014," the report said.

Further steps were not yet to be taken against Ebrahim at this stage, it found.

Another allegation against Ebrahim was that he failed to report to the City council an allegation of misconduct against Whitehead, relating to alleged irregularities involving payments to Volvo for bus chassis.

The Bowman Gilfillan report said a forensic report presented prima facie evidence that "the Commissioner (Whitehead) was involved in irregular expenditure in relation to payments in the aggregate amount of R43 801 807.06 made to Volvo for 29 bus chassis".

It also found that payments totalling R29 584 368 made to Scania for 24 bus chassis during June 2014 were irregular.

'Evidence that Whitehead caused irregular expenditure'

"In our opinion, [the] forensic report… contains compelling evidence that the commissioner caused significant irregular expenditure to be incurred by the City and we recommend that a disciplinary hearing be instituted against her in this regard," the independent investigators' report found.

It said that Ebrahim had admitted that there was no justification for not reporting allegations against Whitehead to the City council.

"In his interview with us, [Ebrahim] conceded this, in his defence, he contends that he took all reasonable steps on his part to comply with his obligations, and that he was ultimately precluded from doing so by the instructions to the contrary from [De Lille]," the independent investigators' report said.

READ: Confidential report reveals De Lille may be ‘guilty of gross misconduct’

It found that allegations contained in a forensic report against Whitehead were "indeed serious and warranted further investigation at the time".

"As stated above, on [Ebrahim's] own version, and supported by the documentation referred to above, the [City manager], the [executive mayor] and possibly a number of other officials may be guilty of inter alia gross misconduct with regard to their failure to report the matter to council as was clearly required," it said.

Intimidation claims

The executive director of safety and security Richard Bosman had alleged that Kesson tried to intimidate him.

This related to the pre-suspension hearing of Ndaba on November 13. Her suspension went on to be lifted in December.

Bosman was appointed chairperson of her pre-suspension hearing and Kesson had represented Ndaba.

"During the pre-suspension hearing, he felt that statements were made in an attempt to intimidate him not to suspend Ms Ndaba."

Statements had included that if Ndaba was suspended, those behind it would be taken to court.

In an email to the independent investigators on December 21, Kesson said he had informed Bosman that Bosman, as well as "other participants", were involved "in an act of political intimidation".

The Bowman Gilfillan report said the investigators did not doubt that Bosman perceived this statement "to be confrontational".

"But there is no reason to believe that it did not represent a genuinely held view," it said.

The report found that there was no evidence to suggest Kesson's conduct constituted intimidation.

Read more on:    city of cape town  |  patricia de lille  |  cape town  |  corruption  |  service delivery

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