Report implicates BMF leaders in fraudulent use of sponsorship money

Black Management Forum
Black Management Forum

A report recently commissioned by the Black Management Forum (BMF) has uncovered alleged fraud in paid-up memberships ahead of the organisation’s elections, taking place on Friday.

According to the confidential interim report, compiled by Mrwebi Auditors and Accountants, the organisation’s membership numbers in the Western Cape were inflated to account for more than a quarter of the overall paid-up members – almost 1 500 of them, according to the report – making it the largest province going into elections.

The BMF, in contrast, claims to have more than 10 000 members in its database.

The report, which City Press has seen, indicates that at least eight corporate members paid R20 000 each for 26 members per company, making that batch alone 208 paid-up members.

However, according to two sources close to the matter, corporate sponsorships of R20 000 for the BMF’s Black Excellence Awards, held in Cape Town in February, were manipulated and recorded as monies for individual memberships.

The BMF’s membership fee is R747 and corporate membership is R30 000.

“The R20 000 would pay for 26 members with some change, but it is highly unlikely that all the companies would pay the same amount – which also happens to be the same as the price of each table at the event, and all have the same number of members,” said a source.

According to the document, Vunani Fund Managers (VFM) is among the companies that paid for its members, and its spokesperson, Jacques de Bie, said the company paid R70 000 for sponsorship.

“We have made a payment of R70 000 to the BMF account, as per the invoice provided to us. The account name, as indicated on the proof of payment slip, was made to the BMF,” he said.

De Bie said the firm was not actively involved with the BMF but was approached to sponsor a conference about 18 months ago, which it did.

“VFM is a member of the BMF, but is not an active member.

“The company was approached again this year for a similar request for sponsorship, but declined,” he added.

Investment management firm Allan Gray, which is cited as having paid R85 215 for 115 members – the highest number in the province – declined to comment on the matter.

Absa, which is stated to have parted with R114 000 for 153 members, confirmed that the amount was for its members and said that an additional amount was paid for an event.

Said Absa spokesperson Phumza Macanda: “This year, Absa paid the BMF in the Western Cape a total of R134 000. Of this amount, R114 000 was for membership fees while R20 000 was for the purchase of a gala dinner table.

“Absa has more than 100 employees who are members of the BMF.”

Fulvio Tonelli, the chief operating officer for PwC Africa – which, according to the report, paid R50 000 for 26 members – confirmed paying that amount but said it was as sponsorship for two tables for the event and not for BMF memberships.

“PwC regards itself as a strategic partner to the BMF and supports various initiatives by the BMF. These include sponsorship for events like the Black Excellence Awards in Cape Town. PwC purchased two tables for the event valued at a total of R50 000,” he said.

Vodacom – which, according to the report, is among those who paid R20 000 for 26 members – said that although it is a member of the BMF, it does not pay for individual members.

“As a benefit for corporate members, Vodacom’s Western Cape office was approached to buy a table at the Western Cape BMF Black Excellence Awards gala dinner,” said Byron Kennedy, head of group media relations at Vodacom.

“Vodacom secured a table and used it as a networking opportunity. Vodacom does not track individual membership subscriptions by staff members, as these are taken on a personal level.”

Old Mutual, which also paid R20 000 for 26 members, avoided responding directly to the question and merely said it supported the BMF and its events.

Airports Company SA (Acsa) confirmed that the R20 000 it paid was for sponsorship, not a membership fee: “Individual membership can be taken up by Acsa employees as part of the sponsorship. However, this is a matter between the individual and the BMF, and we do not keep records of employees who take up membership.”

BMF president Mncane Mthunzi said the organisation was aware of the issue but was awaiting a final report to be processed by an electoral committee before a special board meeting was convened.

He said that unless there was a development that necessitated the meeting be held earlier, it was scheduled for next Friday morning, a few hours before elections would be held.

“The report has not been finalised. The board has received and engaged on a preliminary report. The final report will be submitted to the electoral committee. It will then be discussed at a special board meeting next Friday morning,” he said.

Mthunzi said the event, which corporates paid for, was held in February and tables were sold at R20 000 each, adding that in some instances, negotiations led to some amounts being discounted.

He said the membership audit by Mrwebi was commissioned in August, but it was actually a regular job, effected every three years before elections.

He denied an allegation that the auditors had requested a list of companies, with full contact details, to verify the source of bulk payments in March but that the BMF had only provided the list early last month.

Mthunzi said this could not have been the case as Mrwebi was only approached to do the audit in August.

Mthunzi said Andile Nomlala was the provincial chairperson at the time that the event was held.

He added that he could not disclose the names of nominated candidates as the process had still to be concluded.

City Press has established that Nomlala is one of the candidates nominated as president. Nomlala confirmed that he is in the running.

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