Northern Cape finance, economic development and tourism MEC John?Block – who is also ANC chairperson in the province – allegedly accepted more than R770 000 to influence tenders in the province.
The state alleges that Uruguay-born tycoon Gaston Savoi and his company Intaka Holdings paid the money to Block for the politician to exert his influence in the awarding of massive contracts to supply waterpurification plants.
In an indictment filed at the Kimberley Magistrates Court following the arrest of Block, Savoi and nine others, the state alleges that millions of rands in bribes, kick-backs and dodgy commissions were paid in the awarded tenders, worth R112-million.
The accused face charges of corruption, money-laundering, fraud and racketeering.
The charge sheet alleges that:
» Block corruptly accepted or received R772 000 from Savoi and his company Intaka Holdings in exchange for exerting his influence in the awarding of tenders for the supply of water-purification plants by Intaka Investments.
The money was allegedly laundered through Chisane Investments, a company of which Block was the sole director.
» Former Northern Cape health department head Danile Madyo corruptly received or was offered a staggering R8.672-million to influence tenders.
» R4.75-million – the “proceeds of unlawful activities” – was “laundered” through the business account of Watertech, a Kimberley-based company.
» Sanjay Mitha, the former director of hospital infrastructure in the health department, received R110?000 from Savoi and Intaka Holdings to influence tenders.
» Hammid Shabbir, the former CEO of Kimberley Hospital, received or was offered R8-million to influence tenders.
Shabbir, a former business partner of Block believed to be in Abu Dhabi in the United Arab Emirates, is reportedly considering turning state’s witness.
According to the document, Block played a pivotal role in introducing Savoi to at least four of the alleged conspirators – Mitha, Madyo, Shabbir and Daniel Gaborone, the health department’s CEO.
The accused allegedly “received considerable amounts of money” from Savoi for the “role they would have played in ensuring that Intaka Holdings secured business contracts from the health department in the Northern Cape”.
They “agreed each would register a company...through which these monies would be channelled. The monies would be paid in the form of ‘commissions’.”
Both Block and Savoi are behind bars pending a formal bail hearing that has been set for Tuesday. Block launched two High Court bids to secure his release. Both proved unsuccessful.
Seven other accused were released on bail of between R40 000 and R100 000, and will be back in court on March 18 next year. The case has been under investigation for more than a year. Block’s home and offices in Kimberley were raided by the Hawks in August last year and documents were seized.
The ANC has leapt to Block’s defence, saying it was “shocked” by his arrest and believed “comrade John...is innocent until proven guilty”.
The Northern Cape investigation is similar to arrests in KwaZulu-Natal, where the Hawks arrested eight people including former provincial health department head Busi Nyembezi, former procurement officer Mdu Ntshangase, and chief financial officer Sipho Buthelezi, as well as Savoi, in connection with alleged tender fraud. Last month the chief executive of Ithala, KwaZulu-Natal’s development bank, Sipho Shabalala and his wife Beatrice, as well as Savoi, handed themselves over to the police.
The arrest of the couple also relates to the sale of water purifiers in the province. The couple were subsequently released on bail.
The Asset Forfeiture Unit attached at least R200-million in assets in dawn raids in Durban, Pietermaritzburg and Cape Town. The assets included Savoi’s Ferrari, Maserati, a Lear Jet and properties.
Shabalala’s properties, including a hotel, were attached.