Sipho Shabalala. (Facebook)
Twelve years on and the first “Amigo” has gone to jail.
On Tuesday Sipho Shabalala, the former head of the treasury in KwaZulu-Natal and an ANC member, began doing jail time for corruption.
Shabalala, who persistently claimed he acted on the orders of “his principals”, was sentenced last week in the Pietermaritzburg high court to an effective 15 years imprisonment. His defence applied for leave to appeal conviction and sentence but this was denied and his R100 000 bail was revoked.
The KwaZulu-Natal director of public prosecutions, Elaine Zungu, welcomed the court’s ruling.
“This is evidence that KZN is making strides in our fight against corruption. We will continue to fulfil our mandate of rooting out corruption, especially in the public sector,” she said.
In June Shabalala — a family friend of former KwaZulu-Natal premier and former national health minister Zweli Mkhize — was found guilty of corruption, fraud, money laundering and contravening the Public Finance Management Act for his role in the R44-million irregular purchase of water purifying plants.
Shabalala, 56, was arrested in 2010 and charged in connection with the purchase from Intaka, a company owned by Uruguayan businessman and ANC donor Gaston Savoi. He elected not to give evidence in his trial but admitted in an affidavit that he was an ANC member and facilitated a R1.053-million “donation” by Savoi to the party.
Shabalala then hung on to the money for a year, using it to try to rescue his private businesses before paying it over to Mike Mabuyakhulu, a former KwaZulu-Natal MEC and the ANC provincial treasurer at the time.
In sentencing Shabalala, Judge Dhaya Pillay said his failure to testify was “tragic … he takes the fall while the real villains go free”. The judge said the theft of public money meant for poverty alleviation was akin to“treason”.
Shabalala’s case was initially dubbed the “Amigos” trial and included 23 accused, among them Mabuyakhulu and the ANC’s Peggy Nkonyeni, now the KwaZulu-Natal MEC for finance. Shabalala successfully petitioned to have his case separated.
Charges against Nkonyeni and Mabuyakhulu were withdrawn but the Zondo state capture commission said they should be recharged.
The “Amigos” tag was a reference to how the accused referred to each other in correspondence.
Pillay slammed Mkhize for his role in the matter, saying he was not a credible witness. She said officials were bullied into treating the Intaka purchase as urgent when similar water plant technology was locally available and the price of the Intaka plants wasn’t tested.
The purchase was pushed through with an illegal waiver of procurement processes. The price of the plants doubled and only eight of them were in working order while most were “gathering rust”. Pillay said the Intaka deal was started under the “political stewardship” of Mkhize and ultimately resulted in a purchase that was clearly unlawful and not fair, equitable, transparent, competitive or cost effective.
She said the “probabilities are that Mkhize supported doing business with Savoi, even before he received” a proposal from Shabalala. The court heard Intaka made a profit of R30-million from the deal the judge slated “quid pro quo donations” that “encouraged malfeasance”.
Evidence that the ANC actually received the donation was “dubious”, the judge added.
It emerged in court that Savoi’s donation was paid into Durban attorney Sandile Kuboni’s account and then paid to Shabalala who in turn gave it to Mabuyakhulu, but the donation was not reflected in the ANC’s financial records.
The case against Savoi, Kuboni and the other accused is ongoing.
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