Soccer boss fears own goal in funeral fiasco
Former security guard worries T-shirt deal will impact his empire
WHEN Cape Town tenderpreneur and soccer boss Siviwe Mpengesi got a call from the Eastern Cape treasury to supply thousands of T-shirts for Nelson Mandela’s memorial service, he never imagined that the contract would “tarnish” his image — let alone threaten to destroy his business empire worth an estimated R200-million.
Mpengesi, a former security guard who once lived in a oneroom shack, has been named in an explosive forensic report on how millions in public funds spent on Mandela’s funeral were paid to service providers without official approval.
The scandal, exposed by the Daily Dispatch, has been a nightmare for the tycoon, who recently secured a contract to train about 3 000 police officers to obtain a driver’s licence.
“I have done nothing wrong,” said Mpengesi.
In just six years, Mpengesi, 38, and his wife, Phumeza, 35, have scored contracts worth R106million from the City of Cape Town alone.
Their spacious R3.2-million Cape Town home barely has enough space for their fleet of cars, which include a Toyota Lexus, an Audi Q7, a Mini Cooper Challenger and a Volkswagen double-cab Amarok.
Just one of their estimated 14 companies, Chipcor Construction, owns prime commercial property worth R33.6-million.
Mpengesi has lured one of the country’s top soccer coaches, Steve Komphela, with “an offer he couldn’t refuse” to coach his club, Chippa United, which recently won promotion to the Premier League.
The forensic report by auditors Funduzi Forensic Services details how Mpengesi company,
I provided the service I was paid to provide. I did everything above board
Reagola Print and Mail, was paid R5-million to supply 50 000 T-shirts, 3 500 golf shirts, 3 000 sarongs, 500 umbrellas and 750 raincoats, all bearing Mandela’s face.
About 40 service providers and senior-ranking politicians are being investigated by the Hawks.
The report details how R22million was disbursed irregularly by the Eastern Cape Development Corporation.
It is also alleged that its top brass, provincial treasury officials and senior ANC politicians colluded with service providers to inflate prices and that some of the money was diverted to the ANC’s election campaign.
But Mpengesi is adamant that “a lot of allegations have not been tested . . . I provided the service I was paid to provide”.
Mpengesi said his company had been contacted on December 9 to submit an invoice for the goods.
“Our company was asked telephonically [and] the quotation was duly sent to the chief financial officer and the chief executive officer of the Eastern Cape Development Corporation, as we had been advised to do,” he said.
Mpengesi was adamant that the R4.9-million quotation was justified. “The cost of the logistics [and] cost of material more than justify the price . . . also take into account it was an extraordinarily difficult time to do business. I doubt many other companies could have pulled the order off, let alone at our price. The provincial government, in any event, could have rejected the quote.”
He added that his staff had been given only five days, from December 9 to 13, to deliver the order. “I did everything above board.”
Eastern Cape business associates close to Mpengesi said he had been caught in a fight between the corporation and highranking politicians.
In 2003, Mpengesi quit his job as a security guard to recover supermarket trolleys from Cape Town’s townships. He found 800 trolleys in a month.
His business empire now includes construction, security and cleaning. It employs about 3 000 people countrywide.
The Sunday Times reported last week that Reagola Print and Mail was paid R3-million on December 11 and another R1.97million to print T-shirts for the Mandela funeral.
Sources in the corporation said the treasury identified service providers.
“The corporation had eight days in which to conclude payments. The task was huge ... some suppliers would demand 50% up front and the corporation would oblige after consulting the treasury,” said one source.
Another insider with knowledge of how the payments were made said the corporation confirmed every invoice with the treasury before paying.
According to the Daily Dispatch, the unauthorised R22-million bill included R333 360 spent at McDonald’s and R441 560 at KFC in Mthatha over four days.
R1.9-million was also spent on a sound system, R600 000 on promotional material, R250 000 on a sound truck and R100 000 on a gospel choir for the service in Port Elizabeth.
The treasury allegedly authorised the use of funds from a R330-million infrastructure grant. The funds were for the provision of electricity, water and sanitation, the upgrading of mud schools and the refurbishing of hospitals.