The Special Tribunal has granted the Special Investigating Unit (SIU) a preservation order for R40.7 million to freeze the bank accounts and assets belonging to 14 service providers contracted to the Gauteng Department of Education.

The service providers were contracted to decontaminate schools to the tune of more than R431 million

SIU spokesperson Kaizer Kganyago said the unit had approached the Special Tribunal for preservation order to freeze accounts contenting the sum of R6 million and assets with an estimated value of over R4.7 million belonging to seven companies, five individuals and two family trusts. 

The assets include two Mercedes Benz V Class, Landrover Range Rover Sport, Haval H6 and Toyota Avanza. The action follows an investigation into allegations of unlawful procurement of services by the education department to decontaminate, disinfect, and sanitize schools. 

“The collaboration with the Financial Intelligence Centre (FIC) is very effective and the FIC assisted and based on the information presented by the investigating team issued intervention directions under Section 34 of the FIC Act to place a hold on R30 million of the funds received from the education department. This after seven service providers began dissipating the funds received from the department, upon receipt. A portion of the funds were transferred to multiple beneficiaries who have, in turn, disposed of them,” he said. 

Kganyago said an SIU investigation had revealed that the procurement process conducted by the Gauteng Education Department was “manifestly unlawful”. 

“The Gauteng Department of Education paid over R431 million to service providers pursuant to a process that was haphazard, unfair and littered with procurement irregularities,” he said.

“The department obtained a deviation under Treasury regulations to conduct the procurement process without inviting competitive bids. The department did so on the basis that emergency procurement was warranted, given the urgent and pressing need to appoint service providers to decontaminate schools exposed to COVID-19,” he said. 

He said that the request for the deviation expressly stated that the Department would “appoint accredited service providers from the Central Supplier Database (CSD)”.

“The SIU investigation revealed that the department failed to comply with the express requirement of the deviation. The vast majority of service providers that were appointed (173 out of 280) were not accredited and were not on the CSD. On this basis alone, the SIU will argue before the Special Tribunal that the procurement process was unlawful and falls to be reviewed and set aside,” he said.

He said the SIU investigation had revealed that the procurement process was not cost-effective. 

“The service providers were not paid per square meter of the area cleaned. Rather, a senior official in the department appears to have arbitrarily decided to offer a fee of R250 000 to R270 000 for the decontamination of primary schools; R250 000 to R290 000 for secondary schools; and R250 000 to R300 000 for district offices. The fees bear no relation to the work done by service providers or the cost of material used,” he said.

The order prohibits Fikile Mpofana Pty Ltd, Insimu Projects Pty Ltd, Insimu Consulting Pty Ltd, Insimu Medical Group, Mangaliso Pty Ltd, Lisondalo Pty Ltd, Zenaldo Consulting Pty Ltd, Sigwile Bright Mhlongo, Fikele Eugenia Mpofana, Lindokuhle Bridget Mkhize, Njabulo Mabaso, Richard Mweli, Shuphula Family Trust and Madangu Family Trust from dealing with the funds held in the bank accounts and assets.

“The SIU will forthwith launch review proceedings in the Special Tribunal within the next 30 days and also seek an order against the service providers to pay back all profits as consequence of their appointment,” he said.

He said the SIU investigation into the affairs of the education department were ongoing. 

“Evidence pointing to criminal conduct will be referred to the National Prosecuting Authority (NPA), as well as the Hawks in the South African Police Service (SAPS) for further action,” he said. 

Fraud and corruption allegations may be reported via the following platforms: siu@whistleblowing.co.za  or to the hotline 0800 037 774. 

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Presh JM Reporter

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