State capture: Siyabonga Gama signed R18m Transnet contract to a golf buddy

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Former Transnet CEO Siyabonga Gama. Photo from Gallo Images
Former Transnet CEO Siyabonga Gama. Photo from Gallo Images
  • The company, General Nyanda Security, was awarded the contract without going on open tender.
  • The company, owned by former MK chief and communications minister Siphiwe Nyanda, had no employees and was not registered when it was handed the contract.
  • Gama first denied knowing Nyanda but later admitted their acquaintance, saying they meet up and play golf together.

Former Transnet Freight Rail CEO Siyabonga Gama in 2007 approved an R18 million contract to a company linked to an acquaintance, claiming he was not aware of what he was signing for.

General Nyanda Security (GNC), which was headed by former Umkhonto we Sizwe (MK) chief and communications minister Siphiwe Nyanda, was dubiously awarded the contract by Transnet without going on open tender, according to evidence by Christopher Todd, an attorney who was involved in Gama's disciplinary process by Transnet.

The disciplinary process found Gama guilty on three charges of misconduct.

One of the charges related to the awarding of the security contract to Nyanda's firm, GNS, which he signed, later claiming during the disciplinary process that he had been led to believe it was entered into through the proper procedures when the documents were brought to him to sign.

Gama did not have a mandate to approve contracts exceeding R10 million.

Todd told the commission Gama had initially stated during the hearing that he had no relationship with the owner of the company, but later changed tack after he was presented with telephone records showing his interaction with Nyanda in the lead-up to the awarding of the tender.

He said he had denied knowing Nyanda because "too much was being made out of it", according to Todd's evidence.

Following his admission, Gama told the tribunal that he and Nyanda were not close but called each other and occasionally played golf together.

'Deeply disturbing'

Todd described Gama's capitulation as "deeply disturbing" given that the contract with General Nyanda Security should not have been entered into in a closed tender process and the company had made an unsolicited pitch to Transnet.

It later emerged that the company was not registered with the Private Security Industry Regulator and had no employees. It was only registered months later.

The hearing also found Gama guilty for his role in the awarding of an R800 million contract to a joint venture between a local outfit Sibanye Trade Services (STS) and a US company for the refurbishment of 50 locomotives for Transnet.

The outsourcing of the work was against the board's directive, which wanted the refurbishment to be conducted internally by the firm.

"He went against the board instruction and used a company called STS in which he had an interest," said Todd. Gama challenged his dismissal from the Freight Rail service as recommended by the tribunal and challenged its verdict, claiming the process was conducted unfairly.

"Mr Gama had a steep mountain to climb in challenging his dismissal," said Todd, adding that Gama believed that he was being persecuted and that there were people within the company who were bent on preventing his progress.

Gama was dismissed in 2010 and later reinstated in early 2011 with full pay.

He was eventually appointed acting Transnet CEO in April 2015 following Brian Molefe's departure to head up Eskom.

On Wednesday, former Transnet general manager for legal services, advocate Siyabulela Mapoma, told the inquiry that the freight rail company's ex-chairperson, Mafika Mkhwanazi, had been instructed to "bring Gama back to Transnet".

The inquiry continues.

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