Court hears how officials colluded in a ‘criminal enterprise’ to defraud Nelson Mandela Bay metro

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The NPA says it was alleged that the accused, together with a former councillor, formed a criminal enterprise with the goal of capturing the procurement processes of the directorate. Photo: iStock
The NPA says it was alleged that the accused, together with a former councillor, formed a criminal enterprise with the goal of capturing the procurement processes of the directorate. Photo: iStock

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Seven senior Nelson Mandela Bay Metropolitan Municipality officials and businesspeople appeared at the Port Elizabeth Magistrates’ Court in Gqeberha on Thursday on charges of fraud and corruption amounting to R25.6 million.

The charges, which are in contravention of the Municipal Finance Management Act, included corruption, money laundering, racketeering and fraud. Late former mayor Mongameli Bobani, who died last year as a result of Covid-19 complications, has also been implicated in the saga. Bobani’s estate has since been frozen.

In an alleged effort to conceal the source of funds handed over to Bobani, it is alleged that funds were laundered through the bank accounts of 4 Sisters Trading and Dankovista.
NPA

Mpho Steyn Nangammbi (44), Joram Mziwonke Mkosana (49), Thabo Williams (45), Andile Wellington Tolom (51), Vuyokazi Bazi (35), Thandeka Gloria Buti (50), Rukaard Stefferine Lezario Abrahams (31) and three companies, 4 Sisters Trading Enterprise CC (represented by Buti) Dankovista (represented by Abrahams) and Milongani Eco-Consulting CC (represented by Nangammbi), collectively face 48 criminal charges.

‘Criminal enterprise’

According to National Prosecuting Authority (NPA) regional spokesperson Anelisa Ngcakani, it was alleged that the accused, together with Bobani, a former councillor who served on the standing committee for public health at the time, formed a criminal enterprise with the goal of capturing the procurement processes of the directorate. She said they allegedly acted with a common purpose to manipulate the processes to ensure that Milongani Eco-Consulting CC was awarded with tenders.

“In an alleged effort to conceal the source of funds handed over to Bobani, it is alleged that funds were laundered through the bank accounts of 4 Sisters Trading and Dankovista. It is further alleged that, from August 2015 to February 2017, a total of R2.45 million was paid to Bobani through these bank accounts.

“Dankovista allegedly paid R57 380 towards Bobani’s debts on April 11 2016. Lastly, on April 9 2016, 4 Sisters Trading allegedly received R140 000 from Dankovista,” said Ngcakani.

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The NPA said a total of 43 payments amounting to just over R25.6 million were made by the Nelson Mandela Bay metro into Milongani’s FNB account for tenders.

Nangammbi allegedly split and transferred a large portion of the funds into four FNB bank accounts, which also belonged to the company, and into his three FNB personal accounts.

It is further alleged that the invoices were submitted with no supporting documents and no explanation of how the amounts invoiced were calculated.
NPA

It was alleged that Williams, who was a project officer under the public health directorate, drafted and submitted a report that recommended Milongani Eco-Consulting CC to the bid evaluation committee and allegedly manipulated the evaluation process to ensure that the company was over-evaluated and scored higher than other competing companies.

Subsequently, on May 6 2015, the committee recommended to the bid adjudication committee for Milongani to be appointed in two categories. On May 29 2015, the bid adjudication committee then recommended Milongani to the accounting officer of the metro, and on July 30 2015, Milongani received an appointment letter.

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The link between the accused was also laid bare by the NPA in its case.

The NPA said Mkosana was Williams’ supervisor, while Tolom was an executive director for the directorate from December 1 2015 to February 1 2017.

Bazi was an intern at Nelson Mandela Bay metro’s environmental management section, and Buti was a member of 4 Sisters Trading who had signing powers for the company’s Standard Bank account. Abrahams was the sole director of Dankovista and had signing powers over the company’s FNB account.

Documents allegedly doctored

Despite the prohibition of subcontractors, Mkosana allegedly recruited two other service providers to provide proposals and quotations, and to perform work officially assigned to Milongani. The subcontractors allegedly took complete control of the projects assigned to Milongani and those subcontracted to them. It is further alleged that they invoiced Milongani for work done.

The NPA alleged the subcontractors adhered to Mkosana’s instruction to submit proposals and quotations to him, Williams and Bazi in Microsoft Word format so that the documents could be altered. It was further alleged that the documents were then placed under the letterhead of Milongani and processed under this deception.

Invoices were allegedly submitted by the subcontractors in Word format to either Mkosana, Williams and Bazi, whose task was to place the invoices under the name of Milongani and to add a “consultation fee” charged by Milongani.

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On receipt of payment from the metro, Nangammbi allegedly paid the subcontractors amounts due to them and kept the difference.

From January 2016 to February 2017, Milongani received just over R1.5 million as payment from the metro for invoices.

“It is alleged that between July 2015 and February 2017, Milongani submitted further invoices to [Nelson Mandela Bay metro] claiming for work that was in actual fact not rendered. It is further alleged that the invoices were submitted with no supporting documents and no explanation of how the amounts invoiced were calculated. Mkosana and Williams certified the invoices as lawful,” said Ngcakani.

The accused were granted bail ranging between R1 000 and R20 000. The matter has been postponed to January 28.

Assets seized

On Tuesday, the Grahamstown High Court in Makhanda granted the Asset Forfeiture Unit a restraint order against the assets – worth an estimated R11 million – of the accused, their spouses and entities, including the assets in the estate of the late Bobani.

The appearance of the seven officials in court on Thursday follows another high-profile fraud and corruption case involving officials from a second metro in the province, Buffalo City, where 12 people appeared at the East London Magistrates’ Court on Wednesday in connection with a R5.9 million fraud scandal surrounding the funeral of former president Nelson Mandela. After a five-year delay, the case, which also implicates former health MEC Sindiswa Gomba, is expected to go to trial on October 5 at the East London High Court.


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Lubabalo Ngcukana 

Journalist

+27 11 713 9001
lubabalo.ngcukana@citypress.co.za
www.citypress.co.za
69 Kingsway Rd, Auckland Park
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