Over R20-million has been lost through corruption and fraud at the Mmabana Arts, Culture and Sport Foundation in the North West, the department of sport, arts and culture said on Monday.
“On March 29 we intervened and instituted a forensic investigation on Mmabana as there was dissatisfaction and poor implementation of the core mandate of the foundation as expected,” said spokesperson Shirley Montsho.
“We began investigating when the foundation could not actually render services anymore.”
Much of the money was lost in “employee remuneration liability” which amounted to about R9-million.
This included “R317 871 overpayment of senior management and R82 124 of underpayment of [other] employees”.
The foundation was also in “unlawful” relationships with a number of service providers.
Among others, garden services, gym equipment and services for the 2010 Calabash music festival were procured without going through proper procurement processes.
“Gym equipment for R875 017 was procured without proper procurement processes. A production company was awarded a tender amounting to R297 500 to procure artists for the 2010 Calabash without following tender procedures and payment was authorised by the Chief Financial Officer (CFO) without approval of the Board,” she said.
Mismanagement of assets was also discovered during the investigation, Montsho said.
The rental contract for the Tlhabane Town Hall was “recklessly” signed by the CFO resulting in an unauthorised expenditure of R1 236 000 per annum.
The CFO also allegedly allowed the purchase of a 30-seater bus for an amount of R529 443 from Barloworld Toyota without putting it to tender. “The bus has not been used since 2008 due to mechanical faults.”
Montsho said the CFO was suspended and the acting chief executive officer’s contract was terminated.
“They are facing disciplinary action … no police case has been opened but those and other processes will unfold.” — Sapa