Durban – A former government official with strong KZN attachments was a central figure in the R 255 million asbestos supply corruption case in the Free State, which includes Ace Magashule, the general secretary of the ANC, as accused.
That was the state’s claim in the indictment issued to the 16 defendants in the case at Bloemfontein Magistrate’s Court on Friday.
For the influence of Thabane Wiseman Zulu, the owner of a company which benefited from the asbestos contract would have paid 600,000 rand, at the end of 2015, for the purchase of a Range Rover from a Ballito dealer.
Zulu, who was represented by Durban-based lawyer Paul Jorgenson on Friday, is believed to have also received an undue R1m bounty in May 2015.
The state alleged that Edwin Sodi was responsible for both payments, which showed appreciation for Zulu’s influence in his company, Blackhead Consulting (Pty) Ltd, which scored in the tender relating to asbestos.
The offer in question was a joint venture between Gauteng’s engineering consultancy firm of Sodi (Blackhead) and Diamond Hill Trading 71 of Igo Mpambani.
Zulu was managing director of the Department of Human Settlements when the entity awarded the R255 million contract.
Other important positions held by the Zulus include the municipal director of Msunduzi and the director general of the Ministry of Energy.
He was appointed general manager of industrial development for Richards Bay in June.
In August, Zulu also appeared before the Commission of Inquiry into the Allegations of State Capture, which is chaired by Deputy Chief Justice Raymond Zondo.
He denied having derived any benefit from the asbestos contract and said that the money Sodi paid to the dealership replaced an amount owed to him.
Zulu explained that Sodi used the services of his events company in Pietermaritzburg and asked him to pay the dealership instead.
Sodi also appeared before the commission in September 2020 over his involvement in the asbestos case, and on October 1, he and six other defendants in the case were arrested.
Olly Mlamleli, former mayor of Mangaung and Nthimoste Mokhesi, former head of the provincial human settlements department were among those arrested.
Magashule was arrested on November 13, and during Friday’s hearing, prosecutor Johan de Nysschen said the number of defendants in the case had risen to 16 after three more arrests.
Albertus Venter, who is the head of the legal department in the office of the Prime Minister of the Free State, was charged at number 16.
All the defendants in this case were granted bail of varying amounts after their respective arrests.
They faced collective charges of fraud, corruption and money laundering.
Mokhesi, who is listed as “Accused number 1”, listed Sodi and Mpambani’s joint bid for asbestos eradication in the province on October 1, 2014, and the contract amount was R255 million.
They received a down payment of R 51 million.
Sodi and Mpambani, who was the sole manager of Diamond Hill, subcontracted the work to Sello Radebe and his company Mastertrade 232 (Pty) Ltd for almost R45 million.
Radebe then subcontracted the work to Abel Manyeki and his company, Ori Group (Pty) Ltd for around R22 million.
All the executives involved and their companies are accused in the case, with the exception of Mpambani only.
He was shot dead in 2017.
Mahlomola Matlakala, director of supply chain management at the Human Settlements Department of the Free State, Nozipho Moliko, financial director of the same department and Thabiso Makepe, chief engineer, were the other government officials on the list of accused.
The state alleged that eight of the defendants, all of whom were government officials, ignored the Public Financial Administration Act, Treasury Regulations and Articles of the Constitution as part of their treatment of the offer to ‘asbestos.
They claimed that officials claimed that the proper processes were followed to award the Sodi and Mpambani joint venture the prize, that they had no personal or financial interest in the prize, the sums paid were appropriate.
They also acted as if it was permissible for the original contract to be subcontracted and subsequently subcontracted again, without any disclosure, and that the rates charged were not inflated.
The Auditor General reported the contract award in July 2015 and the DA immediately responded with a petition to the High Court, which called for a halt to all payments on the contract.
But an additional R139 million was paid to the owners of the joint venture.
Therefore, the state characterized the sentence as “illegal” and “irregular”
In addition to being involved in the eight fraud charges, Magashule has five corruption charges to his name.
They relate to the fact that he allegedly received and accepted R53,550, upon his request for his daughter’s tuition, which was made by Mpambani. The state viewed this as an abuse of power, a breach of trust and a violation of a legal obligation, as they believe that Magashule knew that the asbestos contract award was improper.
The State shared the same opinion on Magashule accepting the 470,000 R paid to M-Tag Systems for 200 electronic tablets, the R200000 and R100000 paid respectively to Griffin Edge (Pty) Ltd, for 200 tablets, the R30,000 given to SWC Nkate and R250,000 to Astra Travel.
The travel expenses were for a delegation to Cuba.
Everything was paid for by Mpambani.
The 50 counts of money laundering concerned movement of money between the defendants and their companies in question.
The case was adjourned until August.
Due to lockdown protocols, Magashule was unable to address the thousands of supporters who gathered near the courthouse.
However, at a press conference later, Magashule said he was looking forward to the track and insisted, “I haven’t done anything wrong…”