Zweli’s cash ’n carry - SIU
Minister’s son carried out sacks of cash after Digital Vibes’s dodgy switcheroo, says SIU
Zweli Mkhize’s communications consultants roped in a cash ’n carry boss to help them launder public funds, using dodgy electronic fund transfers (EFTs) to mine the cash that was then collected by Mkhize’s son Dedani.
These are among the explosive allegations contained in a Special Investigating Unit (SIU) affidavit. It claims to lay bare the rot in Mkhize’s office, detailing how funds were clandestinely milked from the department of health.
The affidavit provides a window into an SIU report that is now with President Cyril Ramaphosa. The president is under growing pressure to act on his health minister, who he put on special leave in early June after an exposé by Daily Maverick.
The 90-page affidavit was filed as part of the SIU’s bid to recover the R150m it claims was unlawfully paid to Digital Vibes, the company that health department officials allegedly bent over backwards to appoint in a rigged tender process.
The beneficial owners of Digital Vibes are Mkhize’s close friend Tahera Mather, who has a long history with Mkhize, including working on his failed 2017 bid for the ANC presidency, and her niece Naadhira Mitha.
The matter is now with the Hawks, and includes money-laundering allegations involving Mkhize’s son, who allegedly received more than R4.2m in EFTs, including money for a car, as well as cash in plastic bags and cardboard boxes.
The payments are part of R90m in allegedly ill-gotten gains paid by Digital Vibes to 20 individuals and companies, family and friends of Mkhize and Mather or companies they own (see graphic on page 2).
SIU lead investigator Rajendra Chunilall alleges in his affidavit that evidence points to Mkhize and Dedani contravening the Prevention & Combating of Corrupt Activities Act. The minister is also alleged to have contravened the Public Finance Management Act.
The affidavit contains allegations that the registered owner of Digital Vibes, Radha Hariram, a petrol station manager in Stanger, KwaZulu-Natal, received more than R2.5m from the company. She has, however, laid fraud and embezzlement charges against Mather and Mitha.
She allegedly helped facilitate the cash collections in plastic bags and cardboard boxes for Dedani from the Dawnside petrol station she ran.
In addition to the R300,000 Mather allegedly transferred to Dedani, and a further R160,000 paid to a car dealership on his behalf to buy a Land Cruiser, Mather allegedly paid Desai’s Cash and Carry R3.4m in exchange for cash for Dedani’s benefit.
The affidavit states that Mather asked an associate, Yusuf Ganie, if he knew anyone who could receive money via EFT and then give it back to her in cash. He said he had found someone from Desai’s Cash and Carry in Stanger who had agreed to do so.
“After each of the EFT payments made by Tahera into the account of Desai, I received electronic messages from Tahera advising that the payments had been made. I in turn notified Desai of the payments and Desai regularly confirmed that he had indeed received the EFT payments,” Ganie said, according to the affidavit.
“Desai would arrange for cash to be delivered to me. The cash was contained either in boxes or plastic bags,” he said.
Dedani allegedly collected the cash on six occasions from Hariram at the petrol station. Hariram did not respond to requests for comment.
Mkhize denied the allegations against him before he was placed on leave, and has maintained his silence. Dedani yesterday denied the allegations against him.
“Frankly, the SIU report relies on media reportings — not a tested legal process … I categorically deny ever receiving R3.8m and this submission in the SIU’s court papers is false. From the outset, when my alleged involvement in the debacle was cited, I voluntarily approached the SIU with the assistance of an attorney offering my availability to co-operate with the investigation process,” he said.
The SIU’s affidavit also details how Mkhize tried to explain the R6,720 that Digital Vibes spent on repairs to his home in Bryanston, Johannesburg. He allegedly told the SIU that the cellphone number on the invoices was not his, but the SIU found it linked to vehicles registered in his name. He said his messenger, also a Mkhize, had stolen the cash meant to pay for the repairs and asked Mitha to pay for them. The minister provided an affidavit from his messenger saying this, but the SIU was sceptical.
“During the questioning of the minister, he did not indicate whether he had dismissed the messenger or laid criminal
charges against him for this alleged theft. Therefore the veracity of the explanation of the messenger is, in the view of the SIU, in doubt,” the affidavit states.
Last March, as the first Covid cases were identified in SA, Mkhize was lauded for his deft handling of the public health crisis and his respect for the science that informed the state’s response to the pandemic.
By then, Digital Vibes had been irregularly paid millions of rands by the health department.
In January this year, Mkhize was handed an award by the then US ambassador to SA, Lana Marks, for his “outstanding leadership and collaboration in public health” and his “exceptional stewardship” of the county’s Covid response. A month later, SA’s confidence in him was shattered when the scandal broke, including allegations that Digital Vibes charged R3.65m to facilitate a public address by him on the SABC.
The SIU argues in its papers that Mkhize actively pressured staff to conclude a contract with Digital Vibes, and signed off its work.
Digital Vibes, the SIU concluded, was nothing more than a cover to hide the fact that Mkhize’s friend Mather was doing work for Mkhize’s department.
The SIU contends that the origins of the scandal date back to 2014 when Mather approached Hariram, a former bank employee, to suggest she register a communications company. Hariram, who knew Mather from Stanger, had no previous experience in communications but took the advice and Digital Vibes was born with her as its only director.
The company did no government work until 2018, when Mather phoned Hariram and told her she had work for the firm at the Municipal Infrastructure Support Agent (Misa), which fell under the department of co-operative governance & traditional affairs (Cogta), of which Mkhize was minister at the time. She said it was not a “big contract”.
“I gave my background and experience et cetera, company registration number, Sars [SA Revenue Service] tax clearance, BEE documents,” Hariram told SIU investigators.
Hariram was clueless about how to bid for government contracts, had never met anyone from Misa, and never received feedback on the project after the contract was won. Mather and Mitha were allegedly responsible for it, even though their names were not on any of Digital Vibes’s documents.
In an affidavit, Mkhize’s former Cogta spokesperson, Musa Zondi, said he arrived at Cogta to find Mather doing Mkhize’s communications even though, he later learnt, she was contracted only to Misa. Zondi had been approached by the SIU to corroborate claims the department of health had made.
A year later, Digital Vibes surfaced again at the department of health (see “How to rig a tender” on this page).
Between January and March 2020 Digital Vibes was paid R25m for its work on National Health Insurance (NHI). The contract was expanded through a single e-mail from deputy director-general Anban Pillay to Mather to include Covid, and the company was paid a further R125m. Pillay has previously denied any wrongdoing.
Mkhize approved an R85.5m budget for Digital Vibes under the auspices of NHI, though it had done work on Covid.
His department had by then told the Government Communication & Information System (GCIS) that it did not have a budget for NHI communications — and the cabinet had issued a memo saying GCIS would be responsible for NHI communications.
National Prosecuting Authority (NPA) spokesperson Mthunzi Mhaga said: “The matter relating to Digital Vibes has been referred to the NPA by the SIU and is under investigation by the [Hawks].