The Special Investigating Unit traced financial gains of more than R181 million linked to beneficiaries of fraudulent visa applications that were supported by fake documentation
A low-ranking official has taken the fall for “unlawful activities” related to a dubious R4.2 million Mangaung municipality contract amid the metro’s legal battles with the National Prosecuting Authority (NPA).
Boitumelo Moiloa, the municipality’s debt collection officer, was suspended for allegedly forging customer services manager Salome Makhooa’s signature so Maine Management and Chartered Accountants Incorporated could be paid R4.2 million for work it did not do.
Maine was tasked with identifying households with a collective monthly income of below R3 200 to benefit from a cooperative governance and traditional affairs departmental policy, which began in 2001, subsidising qualifying homes with six kilolitres of free water and 50 kilowatt-hours of free electricity per household per month.
In March, NPA boss Shamila Batohi won a Bloemfontein high court judgment to freeze the nearly R4.2 million Mangaung paid to Maine. Judge Soma Naidoo found that there was credible evidence of “unlawful activities” relating to the company that received the money.
Naidoo added that Makhooa’s signature had been “forged” so that Maine could receive its first payment on 8 August 2023, without submitting proof that it had collected the details of beneficiaries for the programme.
“On the same day that [Maine’s] account was credited with [R1 971 657.75], three debit transactions totalling R85 440.24 and 39 transfers into the names of various individuals in the amount of R316 081.33 were made, leaving the account with a positive balance of R2 946 973.06,” Naidoo said.
The company is fighting for the March order not to be made final, which is what the NPA wants, so that it can keep what the state said should not have been paid to it.
In its defence, at the Bloemfontein high court judgment this month, Maine said the R4.2 million was rightfully paid to them, as the work they were contracted for was done and the proof had been supplied to the NPA. The company stressed that no signature was forged.
Maine director Thapelo Mocwaledi, in his affidavit before court, said the payments were verified and signed off by the now-suspended Moiloa, who attached her own signature, and not that of Makhooa, because it was within her powers to sign the requisition forms.
Mocwaledi conceded that Makhooa was the project manager, adding that an acting senior accountant in the municipality also signed off on work done. He added that Makhooa “refused” to sign for Maine to be paid, leading to Moiloa signing the payment forms, “which is nothing out of the ordinary”.
However, along with the civil application the NPA launched to seize the money paid to it, Maine is under investigation by the Hawks for fraud related to the alleged forging of signatures in the R4.2 million payment, Free State spokesperson Captain Christopher Singo confirmed to the Mail & Guardian.
Mocwaledi, in his affidavit, added that when his company received the Mangaung payments, the municipality was under the administration of the national government, and that the representative sent by the cabinet had to approve payments before they could be made.
But Naidoo’s March ruling revealed that Makhooa, a few months earlier, spoke to Moiloa, expressing her concern about invoices being issued by Maine without submitting proof of work being done, warning Moiloa that the invoices would not be signed.
“Moiloa then informed Makhooa that she [Moiloa] will sign and approve such invoices herself,” reads Naidoo’s judgment.
But Mocwaledi countered by saying it was common practice within the municipality that, in the event of overpayment, the issue would be discussed at the end of the project when final payments and reconciliation took place.
Moiloa, before she was suspended, filed a confirmatory affidavit in aid of Mocwaledi’s fight to retain his alleged unlawful money.
Maine stressed that it was not for Batohi to attempt to enter into an audit process of what she thought the municipality should or should not have paid, adding that the NPA head wanted to “enforce” her views in government matters.
“The applicant [Batohi] is in possession of the work that has been done by the respondent [Maine] and it had been sent to them on various occasions including by way of a memory stick.”
Judgment was reserved in July on whether the NPA could permanently seize the R4.2 million currently under a freezing order.
The court matter comes after a string of mismanagement by Mangaung, including the R260 million losses made in the 2022-23 financial year by Centlec, the municipality’s power distributor.
Last week, Centlec chief executive Malefane Sekoboto was forced to withdraw the two criminal cases he had opened against the entity’s chief financial officer, Hlonelwa Nkomo, who has been on suspension since July 2021, two weeks after her executive tenure began.
In August 2021, Centlec opened a case of theft against Nkomo stating that she had stolen the company laptop she was entrusted with while employed, leading to her being forcefully removed from her office. Nkomo was charged with theft and trespassing in the Bloemfontein magistrate’s court.
Last week, the senior public prosecutor in the magistrate’s court withdrew both charges against Nkomo with “lack of evidence” as the reason.
The Mail & Guardian sent detailed questions to the municipality on the current state of the city since the auditor general’s report and on whether they had recovered any of the misused funds.
The receipt of the questions was acknowledged but they were not answered, despite numerous attempts.