Members of the South African Maritime Authority (Samsa) board are divided over an investigation into CEO Sipho Msikinya, amid allegations that chairperson Chris Nissen is protecting him .
The allegations of money squandering and mismanagement against Msikinya were first disclosed by the Mail & Guardian on January 24.
On the same day the Samsa board met and agreed that the allegations were “serious” and warranted an investigation.
Nissen was ordered to appoint the investigators to conduct a three-day preliminary inquiry. He has not done so, fuelling claims that he is shielding Msikinya.
Nissen this week denied that he was defending the embattled CEO. He said, however, that Msikinya was the victim of an internal “witch-hunt”.
He accused Samsa board deputy chairperson Thulani Dlamini of inflating his travel claims and said the allegations against Msikinya were “baseless”.
Asked why he had not yet appointed investigators, Nissen said he was acquiring quotations from three law firms and a decision on the successful firm would be made this Friday.
He said he has also asked the public protector to probe the matter. “I have already met with the public protector and have given him all the necessary documentation, including the M&G article.”
Samsa is a public entity responsible for sea safety and reports to Minister of Transport Dullah Omar.
In an article titled “Is there no end to Dullah’s woes?” the M&G revealed that Msikinya, who has been head of Samsa for less than a year, had made certain decisions without board approval, authorised expenditure above his allocated limits and made decisions that resulted in Samsa losing hundreds of thousands of rands.
Samsa derives its revenue from a combination of government funding — about R6-million a year — and direct user charges. Senior Samsa officials have told the M&G that massive spending by Msikinya and some of his senior managers have damaged the financial status of the parastatal.
These costs included expenses incurred by lavish trips made by Msikinya, his senior managers and a legal consultant appointed by the CEO. In one case Msikinya flew business class on an overseas trip at a cost of R37 000. He was initially booked on economy class at a cost of R8 000.
A raft of legal fees is also affecting Samsa’s finances.
Msikinya has since denied any wrongdoing, saying his decisions were approved by Nissen and the board.
This week new allegations against Msikinya emerged. He has been accused of giving himself a salary increase last year shortly after he joined Samsa. Other staff members did not receive salary increases.
Nissen this week dismissed the allegation as “rubbish”. But he said the issue would be investigated along with other claims against Msikinya. He questioned how the M&G acquired information about the board’s decision to investigate the allegations.
“How do you know about the board’s decisions when you were not in the board? You must mention in your story as to who from the board has given you information in the interests of transparency.”
Nissen said the allegations against Msikinya were “orchestrated by individuals who have plundered Samsa’s resources. They took Samsa from a surplus of about R10-million to a loss of R11-million. Junior employees gave themselves huge salary increases and started a cadet scheme and nominated their family relatives to the scheme. In addition to the irregular salary increases, the cadet scheme caused further draining of Samsa funds,” he alleged.
Nissen said Msikinya was targeted because he was cracking down on irregularities within Samsa. “Mr Msikinya is doing a fine job,” he said. Nissen claimed that Dlamini was involved in corrupt acts.
“The deputy chair of the board claimed 200 or more kilometres for going from Johannesburg to Pretoria for a meeting. His explanation to me was that he got lost. Isn’t this corruption and fraud? A trip from Johannesburg to Pretoria is only about 60 or so kilometres. Even if he was lost, he would have added another 10 or so kilometres,” he said.
In his response Dlamini said: “I wish not to engage such issues in the media. I would not comment on that because it is clearly an attempt to take me down with them. Why did the chairperson approve the claim if it was fraudulent? How can he approve the claim and then later go to the media to say that it was fraudulent? The CEO has been asked to present his allegations against me to the board before January 26 and he has not done so.”
Nissen said Msikinya needed more time to prepare a report on Dlamini’s alleged irregularities. At the same time, Nissen said, the Samsa management, on the instruction of Msikinya, has appointed a team of forensic auditors to investigate the cadet scheme and salary increases.
Senior Samsa staff members this week complained that Nissen was shielding Msikinya. The staff members said Nissen was seeking to appoint a law firm while the board had asked for the appointment of a forensic auditing firm.
Nissen denied this. He said the board did not explicitly ask for the appointment of forensic auditors. “The board mandated me to facilitate the appointment of a person, persons or institutions, preferably an auditing firm, to investigate allegations and concerns made public by the M&G.”
Nissen said he was advised by Medard Rwelamira, acting Director General of the Department of Transport, to appoint a law firm instead of an auditing firm. He said he believed that a law firm “would do a thorough investigation”.
Related:
Is there no end to Dullah’s woes? 24 February 2003