Joburg uncovers stationery 'kickback' scam

2018-01-31 20:59
City of Johannesburg Mayor Herman Mashaba speaks during an interview in Johannesburg. (Leon Sadiki, Gallo Images, City Press, file)

City of Johannesburg Mayor Herman Mashaba speaks during an interview in Johannesburg. (Leon Sadiki, Gallo Images, City Press, file)

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Johannesburg - Charges will be laid against 31 City of Johannesburg officials implicated in an alleged kickback scandal involving a Johannesburg stationery provider, Mayor Herman Mashaba said in a statement on Wednesday.

"This morning, I received shocking news that 31 city officials allegedly received about R2.7m in kickbacks from a single service provider registered on the city's and municipal-owned entities (MOEs) database," said Mashaba.

The company, in the south of Johannesburg, supplied office stationery and equipment including desktop computers, laptops, printer cartridges and toners worth around R20m.

The implicated officials work in various departments within the city, Johannesburg Water, Johannesburg City Parks, Joburg Property Company, Johannesburg Roads Agency and Pikitup.

One official allegedly made R1m from one transaction, and another allegedly got R685 000 in a toner transaction.

The method was allegedly to inflate quotes to include their cut. This was collected via their payment method of choice which included Shoprite money transfers, First National Bank e-wallet payments, cash payments and transfers to individual accounts.

City to lay charges

"In some instances the goods were ordered and not delivered but they were paid for," the mayor continued.

He said the Hawks, working with the city's group forensic and investigation services department and the Johannesburg Metropolitan Police Department, seized documents on Tuesday night after a raid was conducted at the company's offices.

The company also conducts business with other municipalities where officials are also paid a certain fee for giving them business, the mayor alleged.

"I am disappointed to learn that there are still people in the system who are still involved or engaged in corrupt activities and colluding with service providers.  This is despite the fact that we continuously educate employees about fraud and corruption," he said.

Mashaba said the city would lay charges against the employees and the company.

Comment from the Hawks on the raid or what would happen to the stationery company was not immediately available.

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Read more on:    herman mashaba  |  johannesburg  |  crime  |  corruption

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