Bill fraud ‘should be specific crime’

PUBLIC Protector Thuli Madonsela has called on the government to make doublebilling, overbilling and false billing a specific category of criminal offences.

She suggested linking this with a bounty, whereby anyone who assists the state in the recovery of money would be entitled to 25% of the amount.

Speaking to Business Day after addressing the Institute of Municipal Finance Officers in Somerset West yesterday, Ms Madonsela said billing fraud — especially in the government — had reached alarming proportions.

Ms Madonsela also made a special appeal to finance officers to reconcile invoices with the original quotes on order forms to ensure that the companies that had sent the invoices were the same ones on the order forms.

“We need urgent attention to cut down on corrupt forms of expenditure in this country.

“In the US, they have linked the specific crime of overbilling to their bounty laws and this gives an incentive to whistleblowers to help with the recovery of the monies,” she said.

Last year, the auditor-general’s office reported that R30bn of public funds had been squandered on fruitless and wasteful expenditure.

Last month, Public Works Minister Thulas Nxesi told Parliament that the Special Investigation Unit had uncovered 40 cases of overbilling at the Department of Public Works.

This included overbilling for the controversial work being done at President Jacob Zuma’s home in Nkandla.

The public protector’s office is probing the costs of the Nkandla upgrades.

At municipal level, Ms Madonsela said her office was investigating at least 20 overbilling complaints by ratepayers.

She said the building of RDP houses was often a target for overbilling or false billing as contractors often invoiced for 200 houses when they had only built 150. “There is a real problem and it will affect the economy.”

Ms Madonsela also called on the National Treasury to begin a full-scale investigation into billing problems as her office did not have the mandate or resources to do this.

During her presentation to the municipal finance officials, Ms Madonsela said that the majority of false billing cases the public protector had picked up had to do with accommodation for state officials, the leasing of state buildings and state travel.

This overbilling would often involve collusion by government officials.

Ms Madonsela cited instances where municipal officials stayed overnight in a hotel, but travel agents claimed for a fivenight stay.

The official would then ask the agents to have the extra money transferred into their bank account.

Other instances included municipalities putting in a R2m order for services, only to receive a R6m invoice later.

“The amounts are getting scarier and scarier.…

“You need a fully fledged national project on this … picking a few case studies and examining them.… It’s something that needs to be done urgently,” Ms Madonsela said. With Sapa