Tag: Fraud

Eskom Paid R80,000 for a set of Knee Guards

André de Ruyter, Eskom’s chief executive, has personally helped to identify more than R3 million in overpayments made to Eskom’s suppliers for knee guards. De Ruyter and his team managed to recover over R1 million in just two weeks.

A former employee paid back almost R1.2 million within mere hours after being identified by De Ruyter and Eskom. News24 reported that the money was repaid late in the night of 4 August 2021 and in the early hours of the following morning.

De Ruyter apparently asked that Eskom act against suppliers found to have overcharged the power utility in 2020 – the same year the overpayments were made. When De Ruyter found that little progress was being made on the investigations, he stepped in himself. The investigation was conducted by Eskom’s internal forensic department.

The company has identified three suppliers who collectively scored just under R3 million in overcharging for knee guards, with one supplier allegedly not having delivered a single pair, even though he was paid by the company.

De Ruyter previously told members of the media that Eskom, in the past, paid up to R80 000 for a set of knee guards. Knee guards usually cost between R100 and R300 at hardware stores. The knee guards are used by Eskom workers when they scour and clean the insides of pipes, chimneys, and other areas at power stations.

According to spokesperson Sikonathi Mantshantsha, negotiations are now underway to recoup the outstanding amounts from two other suppliers, and Eskom has laid criminal complaints with the South African Police Service (SAPS).

De Ruyter reportedly confronted a former employee on the 4th of August 2021 about links to a supplier, who turned out to be a relative. The employee – who has since left Eskom  – was responsible for contracting and transacting with the supplier, and ensured payment of more than R1.1 million. There seems to have been no indication that the knee guards were ever delivered, and the employee repaid the money within 24 hours however, Eskom is still taking legal action against the former employee and the supplier.

“Following internal forensic investigations, under the guidance of the NPA, Eskom has laid criminal charges with the SAPS,” Mantshantsha said. 

In another case, a supplier paid R4 000 for knee guards but charged Eskom R934 000. When confronted, the supplier acknowledged the inflated pricing. Eskom has entered a legal process to recoup the money.

“These are the instances we know about, and I can only assume that there is a lot more,” De Ruyter said in February. “If you are a functionally responsive leader, you get into your car and sort those issues out.”

De Ruyter added that Eskom did not have a catalogue of goods, suppliers or spending limits to work with, instead. it relies on “free-text procurement”, which allows officials to buy goods at prices they have determined themselves.

Zuma’s Corruption Trial Resumes Today

Former President Jacob Zuma’s corruption trial is scheduled to resume in the Pietermaritzburg High Court on Monday morning, 19 July 2021.

The infamous Jacob Zuma faces 16 charges of fraud, graft, and racketeering related to the 1999 arms deal scandal.  He is accused of taking bribes from the French company, Thales, amounting to R4 million.

During their last court appearance in May, both Zuma and Thales pleaded not guilty to the charges brought against them.

The lawyers representing former President Jacob Zuma are on Monday expected to call for the case to be postponed by another week.

In an application filed to the Pietermaritzburg High Court during the weekend, Zuma’s attorney, Bethuel Thusini, said that the former president wanted to testify in person about why he should be acquitted of corruption charges without standing trial.

In the papers, Zuma has once again repeated claims previously dismissed by the courts. These include that State prosecutor, Advocate Billy Downer, was biased against him and that the case had been fabricated by his political enemies.

Lockdown Corruption – The Reality

Corruption Watch, the civil society group,  has published its annual report for 2020.  The report highlights the rampant corruption which plagued the country during the Covid-19 pandemic. Aside from issues relating to procurement and the distribution of essential goods and services, there were shocking reports of police and SANDF brutality and abuse of power.  All of this led to Corruption Watch recording the second-highest number of corruption reports since 2012.

A total of 4,780 incidents of corruption were reported in 2020, forming part of the just under 33,000 reports of corruption received by the organisation since 2012. On average 11 complaints were received daily from across South Africa, using available online and digital platforms to highlight the ongoing acts of corruption in both the public and private sectors.

As is expected, the majority of reports came from Gauteng, followed by KwaZulu-Natal and Western Cape.

“While it’s pleasing to report that most of Corruption Watch’s key campaigns have continued throughout the lockdown periods and the volume of reports received by us have increased, it is with anger and sadness that we also have to report that the corrupt took advantage of the public health crisis to loot the procurement necessitated by Covid and even stooped as low as to steal from the various relief programmes,” said David Lewis, executive director of Corruption Watch.

The most frequent forms of corruption during the year were maladministration (17%), procurement corruption (16%) and fraud (15%).

This corruption included problems such as compliance issues, procurement irregularities, soliciting of kickbacks, and fraudulent activities in various state institutions, agencies and departments, as well as businesses.

11% of reports allege corruption in the South African Police Service, 6% point to corruption in schools, 4% refer to corruption in the health sector, and 3% point to corruption in the awarding of driver’s licenses.

Police and South African National Defence Force

Corruption Watch stated that 11% of reports it received alleged corruption in the South African Police Service (SAPS).

The most commonly reported type of corruption included dereliction of duty (29%), abuse of power (28%) and bribery (27%).

“The continued prominence of SAPS-related corruption reports can be attributed not only to the policing environment in the context of the Covid-19 National State of Disaster and lockdown regulations, but also to the Corruption Watch project that has for several years highlighted police abuse and mismanagement,” the group said.

“As a country, we continue to experience increasing levels of crime and corruption, which is aided and abetted by the very institutions that were set up to mitigate and combat these issues,” it said.

The group added that the SAPS is often described as the most corrupt institution in South Africa – citing the Global Corruption Barometer (2019) and the Corruption Watch’s Youth Perceptions survey (2020).

“Its apartheid-era culture of impunity, brutality and abuse of power has found its way into democratic South Africa, reducing public confidence in the police service and tarnishing the courageous efforts of those dedicated police officers who risk their lives daily to make our country a safer place.”

The Healthcare sector 

The group also received numerous reports relating to corruption in the health sector during 2020, with 149 of such cases received.

“The weakened healthcare system in South Africa has been a breeding ground for corruption for years,” it said.

“Under Covid-19, while visits to healthcare facilities may have been reduced, the cases of corruption featured in the Corruption Watch reports centred on procurement corruption, employment corruption, and fraud, counting for 21%, 15% and 11% respectively.”

The group however said that corruption in the healthcare sector has been brewing for years.

“Decades of misappropriation and theft of resources, procurement corruption, and bribery were exposed when our health facilities could not contend with the vast numbers of people needing treatment for Covid-19.”

The new Dr Death facing Murder and Fraud Charges

The National Prosecuting Authority NPA) has made changes to the charges against the controversial surgeon, Dr Peter Beal.  Dr Beal on Wednesday appeared in the Johannesburg Magistrates Court on charges of fraud and murder.  Beal’s co-accused, Dr Abdulhay Munshi was gunned down in 2020 after receiving several death threats.

Meanwhile, Dr Beal is out on bail.

The NPA’s Phindi Mjonondwane said: “The accused, through his legal team, was also served with an indictment and is therefore is expected to appear in the Gauteng Local Division High Court on 19 February 2021.”

National Lotteries Offices’ Raided by Hawks

The Special Investigating Unit (SIU) raided the National Lotteries Commission (NLC) offices in Hatfield Pretoria early on Tuesday morning 8 December, for an array of items to help get to the bottom of any corrupt activities. President Cyril Ramaphosa, last month, gave the go-ahead for an investigation to take place regarding corruption, fraud and tender irregularities within the commission.

According to SIU spokesperson Kaizer Kganyago, the teams, in collaboration with the Directorate for Priority Crime Investigation (Hawks), would be looking for items such as documents, files and computers.  The SIU and Hawks will be investigating “everything” including contracts and allocations made, dating back to January 2014.

“Once we have criminality, we will involve the National Prosecuting Authority (NPA),” said Kganyago. We were fearful of the fact that documents might disappear now that this is in the public, we then applied for a search and seizure warrant which was granted by the magistrate yesterday and that’s why we’re here today.”

The raid reportedly started at 7:00 on Tuesday and would continue until the work was done.

Ramaphosa authorised the SIU to investigate the following concerns at the National Lotteries Commission;

  • (a) serious maladministration in connection with the affairs of the NLC;
  • (b) improper or unlawful conduct by employees or officials of the NLC;
  • (c) unlawful appropriation or expenditure of public money or property;
  • (d) unlawful, irregular or unapproved acquisitive acts, transactions, measures or practices having a bearing upon state property;
  • (e) intentional or negligent loss of public money or damage to public property;
  • (f) offences in terms of the Prevention and Combating of Corrupt Activities Act; and
  • (g) unlawful or improper conduct by any person, which has caused or may cause serious harm to the interests of the public – “or any category thereof”.

Karam Singh, Corruption Watch’s head of legal and investigations, said: “We are very pleased to see a proclamation in the National Lotteries Commission matter. It is something we have tracked given the stories for many years of alleged corruption. We hope the investigation can address the serious allegations of financial irregularities as reported.”

Hawks waiting for Government to decide on Bushiri

South Africans are waiting for an explanation about how fugitive Shepherd Bushiri and his wife Mary Bushiri was able to flee the country without travel documents.  The Hawks said that they were awaiting direction from the government before making their next move.  The Bushiri couple fled to their home country of Malawi, defying their strict bail conditions.

The Hawks on Wednesday issued two more warrants of arrest for the Bushiri’s.  The self-proclaimed prophet and his wife are facing serious charges of fraud, money laundering, and theft in South Africa, where Bushiri was the head of the Enlightened Christian Gathering Church.  If Bushiri’s version of events are to be believed, it would now be more than a week since their disappearance.  The pair left a trail of questions for those responsible to ensure that the couple stayed put.

It is unclear how the issue of more warrants of arrest for the Bushiri’s will help to get the couple back in South Africa to face the court.   Bushiri insisted that he left because the couple did not feel safe in South Africa anymore and were concerned that the case against them could be prejudiced.

Meanwhile President Cyril Ramaphosa said that he expected a report on the matter soon and that government would not hesitate to take action against those who aided the couple in their escape.

Crooked Cops in South Africa

General Kehla Sitole, the national police commissioner,  has acknowledged that police corruption has become increasingly topical following the numerous reports of employees’ involvement in criminal activities. In a presentation to parliament’s Standing Committee on Public Accounts (Scopa) on Tuesday 3 (November), the commissioner stated that the wide perception of police corruption negatively undermines the entire policing fraternity.

According to Sitole, institutions such as the Directorate for Priority Crime Investigation (DPCI or the Hawks), Independent Police Investigative Directorate (IPID), National Anti-Corruption Unit (Detective Services) and Investigative Directorate (ID) have been established to investigate corrupt activities, including activities by employees of the South African Police Service.  He added that 397 cases involving police are currently investigated, with 257 already arrested.

Commissioner Sitole said that as soon as the SAPS is informed of allegations of corrupt activities, the necessary disciplinary proceedings are immediately initiated, The most common types of corruption  include contravention of the Disaster Management Act, soliciting bribes, defeating the ends of justice, aiding an escapee, extortion, and fraud. Disciplinary proceedings have been instituted against the employees and some of them have been suspended from service as a precautionary measure. Of the 286 cases reported since 1 April 2020, a total of 216 have been finalised, it said.

546 employees are involved in the 286 cases including 2 Lieutenant Generals, three Major Generals, and 8 Brigadiers.

The 286 cases were further broken down as follows:

  • Disaster Management Act- related cases: 136
  • Aiding an Escapee: 14
  • Defeating the ends of justice: 38
  • Fraud: 8
  • Theft: 55
  • Extortion: 35

High-profile cases 

High profile cases are cases of high priority which involve senior managers and cases that the management prioritised due to media attention, the SAPS said. As of 1 April 2020 to date, the SAPS said that 79 employees have been involved in these cases and 25 disciplinary proceedings have been finalised.

The SAPS also pointed to specific cases which were currently under investigation:

  • The ‘Blue Lights’ case which saw former acting police commissioner Khomotso Phahlane arrested following an investigation into an R86 million blue lights tender;
  • Fraud related to software firm Forensic Data Analysts (FDA) which provides police with hardware and infrastructure used in forensic investigations;
  • Irregularities surrounding a Telkom tender.

A report by civil society group Corruption Watch in September found that the SAPS is consistently one of the most complained about institutions in South Africa. For the second consecutive year, this focus area, at 13%, leads in terms of complaints received. “Whistle-blowers express their despondency and consternation with the police service in an assortment of allegations, which principally highlight the brutality, inconsiderateness and inhumanness toward the public, and lack of regard for law and order that officials and officers display.”

Corruption Watch reported that bribery allegations made up 31% of police corruption cases, as officers solicit bribes from suspects and victims of crimes alike, and sometimes from small businesses as well as ordinary members of the public. Demands for bribes are to allow alleged criminals, generally drug dealers, to operate with impunity or to ‘make dockets disappear’.

The report found that small businesses, mostly informal traders, have their goods confiscated only to have them returned should the owners be willing to pay whatever amount of money is demanded. Should a public member wish to remain unbothered and hassle-free, officers allude to the fact that they have the power and means to make a person’s life ‘very difficult’ should they be unwilling to co-operate. Such cases were especially common during the lockdown period, Corruption Watch said.

“We are informed that such sporadic acts of violence occurred when the officers accused persons of not complying with lockdown rules and regulations. Ironically, other abuses of power that the police are said to have committed involve the selling of banned goods, mostly alcohol and cigarettes, and allowing unauthorised businesses to trade during the very same period,” it said.

Markus Jooste to pay R241 million fine

The FSCA (Financial Sector Conduct Authority) has imposed an administrative penalty of R241 million on the disgraced former Steinhoff CEO, Markus Jooste, for insider trading.  The FSCA in a statement said the administrative penalty followed an investigation that proofed Jooste was privy to Steinhoff-related “inside information” before the company’s shares tanked.

Jooste was at the centre of the Steinhoff scandal, being accused not only of insider trading, but also involvement in false financial reporting.  “The administrative penalty imposed on Mr Jooste is pursuant to an investigation by the Authority which found that on 30 November 2017, shortly before the much-publicised significant decrease in the market value of Steinhoff shares, Mr Jooste was privy to Steinhoff related inside information,” the FSCA said in a statement.

“Whilst privy to inside information, he disclosed some of the information in a ‘warning SMS’ encouraging four individuals close to him to dispose of their Steinhoff shares prior to the publication of some of the inside information to the rest of the market. Three recipients acted on his disclosure and encouragement and sold Steinhoff shares.”

Jooste reportedly sent cellphone messages to his friends advising them to sell their Steinhoff shares days before it imploded.  Steinhoff endured hefty losses and a stream of lawsuits since revealing holes in its accounts in 2017.  The first sign of fraud were estimated total R115 billion and from which it was still battling to recover.

Once the fine has been issued as a formal invoice, Jooste will have only 30 days to pay.

Breaking – Two Police Brigadiers Arrested

Two Police Brigadiers were arrested on Tuesday and will face charges of fraud and corruption.  The National Police Spokesperson Brigadier Vish Naidoo, confirmed that two senior officers were arrested by the Western Cape Anti-Gang Unit, who were assisted by the National Anti-Corruption Unit.

“The brigadiers have been arrested for their alleged involvement in fraud, defeating the administration of justice and contravention of the Firearms Control Act in multiple case dockets in the areas of Edenvale, Kempton Park and Norwood in the province of Gauteng.”

The arrest of the two brigadiers brings to 28, the total number of people arrested in connection with these cases after 26 people were arrested earlier this year.  Of the 28 suspects, 17 are police officers, of which two are retired, and 11 are civilians.  These investigations started three years ago when it emerged that, during November 2017, security companies were involved in crimes of extortion in the Western Cape province relating to firearm applications in Gauteng,” Naidoo said.

The two officers are expected to appear in the Kempton Park Magistrates Court on Wednesday.

Kilian Now A Suspect in Another Attempted Hit

Zane Kilian was expected to make his bail bid in the Belville Regional Court on Monday when the court was informed of additional charges that had been added.  Investigators on Monday said they believed Kilian, the man who is believed to be linked to the death of detective Kinnear, is also linked to an attempted hit on a prominent attorney.

Kilian has been in custody for more than a month and was expected to appear in court today for his bail hearing.  The court however heard that another charge of conspiracy to commit a murder and a count of fraud have been added to his charge sheet.  Both charges were added for his alleged involvement in the attempted killing of William Booth, an attorney, earlier this year.

Kilian is expected to appear in the Cape Town Magistrates Court on Tuesday to face the new charges against him.  The fraud charge relates to documentation allegedly outlining his registration as a private investigator.  Eric Breyer, Kilian’s defence attorney, said that more charges had not been ruled out.

Five suspects were charged with attempted murder of the prominent defence attorney, William Booth earlier this year.  Booth was unharmed after two men wearing surgical masks fired at him at his Higgovale home.  Kilian is now facing charges for involvement in the attempted hit.

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