Daniel Mthimkhulu, a former Passenger Rail Agency of South Africa (Prasa) executive who was fired for lying about his qualifications and who played a central role in the "too tall" trains tender scandal, has been ordered to pay Prasa back R5.7m.
The amount was paid to Mthimkhulu after he fraudulently lied about his qualifications in order to obtain a senior position at the state-owned rail operator, and subsequently fraudulently presented a fake offer letter from a German company to push up his salary.
Gauteng High Court in Johannesburg Judge Leoni Windell on Monday handed down judgment after Prasa sought to recover money paid to Mthimkhulu as a result of him being appointed to the position of Executive Manager: Engineering Services in 2010.
Windell also granted a punitive costs order against Mthimkhulu as a result of his conduct during the trial.
The Supreme Court of Appeal previously found that Mthimkhulu played a central role in the unlawful R3.5bn tender awarded to Swifambo Rail Leasing for the supply of trains in 2013 – the so called "tall trains" scandal.
Swifambo and Prasa have been embroiled in years of litigation following a forensic investigation by Werksmans Attorneys. The order against Mthimkhulu is Prasa's latest victory in recovering taxpayer rands.
Windell's judgment was scathing of Mthimkhulu in finding in Prasa's favour, dismissing his evidence in its totality and accepting Prasa's evidence of the fraud he committed.
A history of fraud
In September 2010, Mthimkhulu's salary was increased to R2.8m a year by then-group CEO Lucky Montana, after Mthimkhulu presented him with a purported offer letter from DB Schenker – a German company.
According to the judgment, Montana then authorised a counter offer matching the salary which Mthimkhulu accepted.
Mthimkhulu denied receiving a job offer from DB Schenker, claiming that he was given an increase on the basis that a different German company, P-Tech Systems, had made him an offer of 200 000 euros.
This is despite evidence being led before the court that two letters from DB Schenker were found in his personnel file during an investigation into his qualifications.
Mthimkhulu alleged that his HR file was tampered with, in an attempt to "destroy his career".
But, as the court found, this was not Mthimkhulu's first fraudulent misrepresentation. He had in fact, it emerged, lied about his qualifications in order to obtain the position in the first place.
In April 2010, Prasa appointed Mthimkhulu to the position of Executive Manager: Engineering Services.
Prasa alleged that he represented, through his CV prior to March 31, 2010, that he had a National Diploma and a Bachelors’ Degree from the Vaal University of Technology.
The degrees were a minimum requirement for the position.
"It is common cause that Mr Mthimkhulu, at the time of his appointment, did not hold a National Diploma and Bachelors' Degree from the VUT and only had a matric qualification. Mr Mthimkhulu accepted that any statement made before July 2015 that he had completed a National Diploma and a Bachelors' degree from the VUT would be incorrect. He however, denied that he ever made such a statement," Windell's judgment reads.
But Mktimkhulu's CV, found in his personnel file, clearly stated he had obtained the VUT degrees in 2010, and held a doctoral degree in "Engineering Management", obtained in 2010.
Mthimkhulu "vehemently" denied that the CV was his, or that he was responsible for the information in it.
Mthimkhulu told the court that many people employed at Prasa, intent on destroying his career, had fabricated the CV and placed it into his personnel file.
A key element of Mthimkulu's evidence before court is that there was never any advert for the position of Executive Manager: Engineering Services to which he was appointed in 2010, and that he was promoted through the ranks for his experience and skill.
But the court found that the evidence confirming there was an advert for the position was "overwhelming".
If there was an advert there must have been an application form and a CV submitted by Mthimkhulu, but the file surrounding the recruitment process for his position went missing, the court heard.
"I am satisfied that Mr Mthimkhulu falsely represented to Prasa that he held a National Diploma and a Bachelors' degree from the VUT. This false representation induced Prasa to appoint him in the position of Executive Manager: Engineering Services," Windell found.
The fake letter
According to Windell's judgment, Mthimkhulu committed further fraud during the trial.
Mthimkhulu produced a letter of a job offer from P-Tech, which he sought to use to prove that he had never given Montana a letter from DB Schenker as a proposed job offer to push up his salary.
Windell, however, agreed with Prasa that the P-Tech letter was a recently created forgery.
Mthimkhulu contended that he had provided the letter to his lawyers in December 2018, which the court found improbable as it was an important document in terms of proving Mthimkhulu's version.
The judgment also deals with obvious signs that the P-Tech letter is a fake, such as the many grammatical and spelling errors, different fonts, and that the Euro sign was placed after the amount and not before.
"I agree with counsel for Prasa that it is highly improbable that an international company with the reputation and profile of P-Tech would send a letter containing blatant spelling and grammatical errors and formatting inconsistencies. It is more probable that Mr Mthimkhulu authored the letter by taking an invoice from P-Tech and removing the invoice contents, and inserting the typed portions containing a job offer."
Prasa presented further evidence of Mthimkhulu's misrepresentations in that, for years, he referred to himself as "Dr Mthimkulu", despite never actually having obtained a doctorate as he had claimed.
The court heard that this was, however, not the only document that demonstrated how Mthimkhulu had "deliberately sought to represent that he had been awarded a doctorate degree".
Prasa records showed Mthimkhulu had completed forms and entered "Dr" under the title section, referred to himself as "Dr Mthimkhulu" in official documents, letters and emails and even signed various invoices for reimbursements as "Dr Mthimkhulu".
But the court found that the most telling document was an email dated July 5, 2011, in which Mthimkulu requested that his official Prasa email be changed to reflect the title "Dr".
Mthimkhulu told the court that the "Dr" was never meant to be used as a title, but rather as an "unofficial name" and a nickname he had earned from a Stellenbosch professor's comment calling him "the Doctor of trains".
"I find Mr Mthimkhulu's explanation, although at times entertaining, highly improbable. His version is clearly false and rejected.
"I am confident in finding that Prasa was indeed induced to increase Mr Mthimkhulu's annual salary to the amount of R2.8m by fraudulent misrepresentations made to it by Mr Mthimkhulu," Windell found.
Windell further found that Mthimkhulu "made a very poor impression in the witness box".
"He was evasive and his testimony was incoherent and not supported by any extrinsic evidence. His evidence in its totality is rejected as false. The various witnesses that he stated he would call to support him failed to appear. The only inference that can reasonably be drawn from their failure to testify is that they were not prepared to give untruthful evidence in Mr Mthimkhulu's defence."
Prasa suffered, at the very least, damages of R5.7m, Windell found.
Prasa called for a punitive costs order, which the court agreed to.
"Not only has fraud been established, which of itself warrants the award of punitive costs, but his conduct during the trial justifies it," Windell's judgment concludes.