DURBAN - FORMER eThekwini mayor Zandile Gumede and several councillors allegedly entered into a brazen plan involving city manager Sipho Nzuza and other senior officials to loot millions of rand from the city’s coffers, the State has alleged in its indictment regarding the multimillion-rand DSW tender scandal.
The matter came before the Durban Commercial Crimes Court yesterday where the State, represented by senior State advocate Ashika Lucken, served the indictment on the accused.
The case has been transferred to the Durban High Court for a pre-trial conference on June 14.
Among the 22 co-accused are Gumede, Nzuza, senior eThekwini councillor Mondli Mthembu, supply chain management head Sandile Ngcobo, head of “Special Projects” Robert Abbu, private service providers and companies.
The accused are facing a raft of charges including corruption, theft, fraud and money laundering in relation to the DSW refuse disposal contract.
The indictment details how, soon after their inauguration in August 2016, Gumede and Mthembu allegedly set up a clique that was to rope in Nzuza, Ngcobo and Abbu to bypass legal procurement procedures in order to siphon municipal funds into a select group of companies – all under the guise of radical economic transformation.
The State alleges that cellphone records showed constant communication between Gumede, Mthembu, Nzuza, Abbu and members and directors of the companies that won the tender during the run-up to the finalisation of the award. Of the more than R320million that was allegedly stolen, defrauded and laundered in respective instances, R100 000 went into the back pocket of the ANC region, alleges the 324-page indictment prepared by the State.
It was further alleged that the companies had paid Gumede, who was then the chairperson of the party’s regional structure, various amounts directly into her and her daughter’s bank accounts.
She used her position to influence illicit payments from four companies to councillors and hastily set up community-based contractors, the uMkhonto Wesizwe Military Veterans Association (MKMVA) and the Amadelangokubona business forum, the State alleged.
Explaining how the alleged plot was hatched, the State said Gumede, a long-serving councillor in eThekwini, had been aware of the impending end of a previous solid waste removal contract when she became mayor.
The State said that despite requests from colleagues, Abbu had failed to finalise the supply chain management (SCM) process to bring in new service providers, even though this process should have been concluded a year prior to the ending of the old contract.
“The evidence available indicates that Gumede and Mthembu, through Nzuza, Ngcobo and Abbu, controlled the SCM, administration and financial components of eThekwini in respect of the new Durban Solid Waste contract, to the benefit of Gumede, Mthembu, Nzuza, Ngcobo and Abbu, (as well as the four) service providers, councillors, political organisations (ANC region) and business forums (Amadelangokubona),” the indictment read.
Gumede had told a meeting of councillors that it was time for radical economic transformation, the State said.
The State said Nzuza created a “special projects” unit to be headed by Abbu, even though Abbu was officially the deputy head for strategic and new developments. It was alleged that the unconventional move was intended to empower Abbu with authority to select four companies that were to be used as vehicles that would divert monies to a set of subcontractors that had been identified by councillors in certain wards.
As the chairperson of the Bid Adjudication Committee, Ngcobo had approved an application by Abbu to award the solid waste removal contract outside of the supply chain processes to Ilanga La Mahlase Projects, Uzuzinekele Trading 31 CC, Omphile Thabang Projects and El Shaddai Holdings Group CC.
The four service providers, some of which were neither on the city nor national Treasury’s supplier database, had been hand-picked despite 1 088 other companies having provided proposals to do the job, the State said.
The city paid R320 955 973.33 to the four, despite the original contract having been set at a relatively meagre R45m, the State said.
The State said the preferred companies had inflated prices and, in some instances, provided duplicate and false claims. In one instance, a 16 000kg amount of waste was claimed to have been removed, whereas records showed a relatively small 1.6-litre engine vehicle was in fact used, which misled the city to pay an inflated price, it was alleged.
The other accused include company directors, service providers and the respective entities including Nzuza’s wife, Bagcinele Nzuza, Mzwandile Dludla (Ilanga la Mahlase), businessman Hlenga Sibisi, Zithulele Mkhize (Uzuzinekele), Prabagaran Pariah (El Shaddai), Sithamone Ponnan (Umvuyo), Bongani Dlomo and Khoboso Dlomo (Omphile Thabang Projects) and Craig Ponnan. The remaining accused are councillors Siduduzo Khuzwayo, Mthokozisi Nojiyeza and Bhekokwakhe Phewa.
“The combined conduct of Nzuza, Ngcobo, Abbu, the officials of eThekwini employed at the landfill sites (of the city) and the nominated service providers appear to be synchronised to one objective,” said the indictment.
“If the participation of any one of these role players (sic) were absent in the transactions under review, Gumede and Mthembu would not have been able to fulfil the objective that they had communicated to councillors in relation to the new DSW contract. Therein lies the basis to conclude the common purpose between Gumede, Mthembu, Nzuza, Ngcobo, Abbu, the main contractors, the landfill sites’ officials, the nominated service providers, the councillors and other political beneficiaries.
“Councillors Bhekokwakhe Welcome Phewa, Sduduzo Khuzwayo and Mthokozisi Nojeziya were among the councillors that formed part of this radical economic transformation process. They were instructed to source community-based contractors as sub-contractors,” the State alleged.
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