COUNCIL HIRED ‘HITMEN’ - REPORT
Cogta MEC accuses municipality of paying thousands to thugs for security work
A Bhisho report has lifted the lid on how taxpayers in a rural Eastern Cape municipality allegedly footed a R1.2m salary bill for 15 alleged hitmen to protect politicians, officials and a service provider.
The findings are contained in a disputed co-operative governance & traditional affairs (Cogta) report that investigated fraud, corruption and maladministration at Ingquza Hill municipality between 2018 and 2019.
The report did not provide details of how the 15 were identified as hitmen, saying only that they were well known in Lusikisiki and Flagstaff.
The report, dated March 20 2020, is signed by Cogta MEC Xolile Nqatha. It was tabled in council on August 18 but not discussed until Tuesday, when councillors rejected it.
Mayor Bambezakhe Goya told the Dispatch that speaker Ntandokazi Capa had received objections to the report. “We resolved that it should go back to the MEC because there are some gaps, like missing attachments, while some people said they were never given a chance to state their side of the story.”
The report mostly points a finger at axed municipal manager Mluleki Fihlani, blaming him for the alleged appointment and use of 15 “well known hitmen” to protect a construction company’s assets and staff when the company fled after alleged threats.
Fihlani told the Dispatch on Tuesday that the report was “nonsensical in its entirety” and described it as part of a smear campaign to tarnish his name.
The report states that when Siva Pillay Construction workers went back on site, Fihlani “facilitated the protection” of the company by “providing 15 men well known in Lusikisiki and Flagstaff as iinkabi [hitmen]”. “Mr Siva Pillay revealed that these people are paid by him and he in turn submitted a claim to the municipality to be reimbursed. The MM [was] doing this in order not to be detected in his corrupt practices,” Nqatha wrote.
The company was roped in to do paving in New Town Street in Lusikisiki and subcontracting in Flagstaff — but a local business forum was apparently unhappy as Siva Pillay Construction
is based in Port Shepstone in KwaZulu-Natal.
The report also found Fihlani allegedly authorised a R1.2m payment to Pillay’s company after he had been placed on precautionary suspension on February 12 2019.
“This is a serious crime and has already been handed over to the Hawks. This is fraud. The municipality paid Siva Pillay Construction additional amounts in its surfacing tender so as to allow Mr Pillay to pay [the] hitmen who protected the political and administrative leadership of the municipality.
“The employed 15 hitmen [were] paid R15,000 per month.”
Nqatha’s report recommended that if the alleged hitmen were “involved in any criminal activities, they should be arrested, charged ...
Pillay confirmed on Tuesday that the municipality “sorted out our security” after he threatened to pull out of the project because of threats from the forum. “In the beginning I think it was 15 security guards guarding our plant. During the day they were guarding our people on site because the forum said they were going to kill us, and that we should move out of site.
“They [municipality] did the deal separately to pay the security guards in order for us to fulfil their project. I [could not] put R50m worth of plant at risk for a R10m project, so I wanted to write to the surety company to say ‘this is why I am pulling out of the project, please give my surety back’ but they [municipality] said ‘no, no, we’ll get you the guards and the guards will sort out your problems’.
“They never put it [in payment records] as guards; they put it as something else.”
Asked who had organised the security, Pillay said it was “the municipal manager together with the technical director”.
He said the security guards had watched their plant for about nine months, and he did not know they were alleged hitmen.
However, Fihlani vehemently denied the municipality had paid for the security guards, saying Nqatha’s report was nothing but a ploy to assassinate his character. “What I advised is to say ‘surely the company has got to beef up its security because we as the municipality cannot provide security. At no stage did we provide them with security. Even the use of the word iinkabi has a very serious criminal connotation.
“This is very serious and it is just meant to defame my character — nothing else,” he said, adding he was legally challenging the report.
Fihlani is also legally challenging his sacking after being found guilty of 10 charges in an internal disciplinary action. The Mthatha high court has reserved judgment in the case.
Nqatha’s spokesperson Makhaya Komisa said: “We are going to assemble the team that conducted the investigation and examine the submitted objections. It was at the invitation by the MEC when presenting the report for any aggrieved party to make representation.
“We, however, wish to record that some of the people who claim not to have been interviewed decided not to co-operate with the investigation even when the former MEC pleaded with them to co-operate.
“If the council decided to reject the report it is their choice but the report stands until a due process sets it aside.”
Recruitment processes at Ingquza Hill municipality are so flawed that even someone who had not applied for a job was appointed as a truck driver.
Senior managers were allegedly appointed as directors despite not meeting the requirements for the top jobs.
These are findings of a report by co-operative governance & traditional affairs MEC Xolile Nqatha after an investigation into allegations of fraud, corruption and maladministration at the Lusikisiki-based municipality. The investigation was conducted between 2018-2019. The report blamed former municipal manager Mluleki Fihlani for the alleged irregular appointments.
One of the directors received the nod while under investigation by the police for allegedly committing fraud while in the employ of Alfred Nzo district municipality. The official was arrested three months after starting work at the Lusikisikibased
local authority. The status of the criminal case could not be established at the time of writing on Tuesday.
Nqatha wrote that Fihlani and then mayor Pat Mdingi had objected to the investigation, with investigators only getting started when the administrator was placed on precautionary suspension and the politician recalled by the ANC.
However, Fihlani said they were not against the probe but wanted due processes to be followed. He told the Dispatch he had never been interviewed by the investigators.
In his report, which was discussed in council on Tuesday, Nqatha said the two directors only had diplomas instead of the required bachelor degrees.
“The council should investigate how the people were appointed without meeting the requirements as set by the council, and must further take disciplinary action against the MM for the irregular appointments.”
The two directors have not been named as they could not be contacted for comment.
Fihlani told the Dispatch that Nqatha’s predecessor, Fikile Xasa, had concurred with the appointment of the two directors. He described the report as illegal.
“Had they interviewed the implicated people, they would have different findings. They had the findings even before they started their investigation.”
Nqatha also declared the appointment of a truck driver who had reportedly not even applied for the job invalid. But Fihlani insisted everything had been done above board.
Nqatha wrote that his team of investigators had uncovered serious cases of fraud and corruption, using an example of how two companies had bid to supply stalls for hawkers.
One company quoted R1.9m and the other R900,000. The lowest bidder won the tender.
But “upon payment, the lowest bidder was paid the R1.9m” as quoted by the failed bidder.
“When questioning the municipality, [the owner of the company that did not get the tender] was informed by [a senior manager] that the service provider did not calculate the tender correctly and they at SCM made calculations which amounted to the R1.9m.”
The municipality also failed to take away the signing and financial rights from an official whose acting term as the CFO had lapsed.
Between December 2018 and February 2019, the former acting CFO continued to have signing powers despite her acting term having expired.
Turning his attention to alleged unfair labour practices, Nqatha’s report found that Fihlani had written to an official instructing her to “disclose confidential information regarding her health”.
“To make matters worse, [the official’s] medical information was requested even from her medical doctor as she was perceived to have been lying about her health.”