‘Premeditated agenda to loot state’
Calls for eThekwini city manager Sipho Nzuza to be suspended 17 accused allegedly colluded with service providers
ETHEKWINI city manager, Sipho Nzuza, was arrested yesterday for allegedly colluding with service providers to irregularly procure contracts related to the multimillion-rand Durban Solid Waste (DSW) tender deal.
During his appearance in the Durban Specialised Commercial Crimes Court yesterday, the State alleged that Nzuza’s actions and those of his 16 co-accused were deliberate and that they had acted on a premeditated agenda to loot the state and benefit directly or indirectly.
Nzuza is facing a raft of charges including fraud, corruption, conspiracy to commit fraud and corruption, and contravening the Municipal Financial Management Act.
He is the 17th accused in the criminal case involving former eThekwini mayor Zandile Gumede and 15 others, including deputy head of strategy and new development Robert Abbu, Hlenga Sibisi, Mzwandile Dludla, Sinthamone Ponnan, Zithulele Mkhize, Bongani Dlomo and Prabagaram Pariah.
The amount relating to the tender deal has ballooned from R389 million to R430m.
Nzuza was arrested after the head of the city’s integrity and investigations unit, Mbuso Ngcobo, reported his alleged role in the tender deal to authorities. Ngcobo is the complainant in the matter, the court heard.
Nzuza was granted R50 000 bail and will next appear in court along side his co-accused on April 16.
Last year The Mercury reported that Nzuza had turned State witness in the investigation.
State prosecutor Ashika Lucken told the court that the prosecution did not dispute that Nzuza had been in consultation with the investigating officer.
However, the investigation had “revealed that those facts that he provided showed that he was involved and acted in common purpose with the other accused”, said Lucken.
She alleged that Nzuza and the other senior city officials had colluded with service providers to irregularly procure contracts related to the solid waste tender.
Lucken alleged that Nzuza had “aligned” himself with the outcomes of the tender to ensure the accused contractors were awarded the contracts and further extended the contracts in 2018.
“The allegations are that service providers did not follow supply chain management procedures. A further investigation revealed there was collusion with various municipal officials who have already been charged. The State alleges that these officials were deliberate and acted on a premeditated agenda to loot the state and benefit directly or indirectly,” Lucken said.
She alleged that Nzuza extended the DSW contract to R79m initially, and even though he had been made aware in March 2018 that the budget was exhausted, “he further extended the contract from R79m to R181m”.
There was also allegedly extensive communication between Nzuza, the bidders and other officials in the municipality, Lucken claimed.
She alleged that Nzuza had also not disclosed his relationship with one of the service providers who won the contract.
“The State also indicates that (Nzuza) awarded the contract despite the Bid Adjudication Committee rejecting the companies that bid,” Lucken said.
Nzuza submitted an affidavit in support of his bail application in which he said the charges relating to his arrest were only made known to him yesterday morning.
He briefly referred to the allegations he was facing in his affidavit, and alluded to the fact that he was, in fact, a whistle-blower: “In the ordinary course and on or about February 2018, I received copies of forensic reports. These reports related to allegations of, inter alia, fraud, corruption and maladministration with respect to the awarding of two contracts in eThekwini Municipality, mainly: the manufacturing and distribution of orange recycling bags and the supply, delivery and construction of urine-diversion toilets to certain wards in eThekwini Municipality.
“I, as municipal manager, took the view that I was duty-bound to implement several recommendations arising from such reports. These included consequence management steps such as internal disciplinary proceedings and the laying of criminal charges against various officials, including political office bearers. I have been in constant communication with, and provided full support and co-operation to, the Hawks’ National Clean Audit Task Team.”
Nzuza said he would “categorically” be pleading not guilty to the charges.
“At the outset, I am the one who lodged the complaints with the police. I have always complied with all and any requests they made to me to the point of rearranging my affairs for their convenience. I pledge to continue to do so.”
He further said that the “co-operation and interaction” had taken place over almost a year and that he had assisted despite being told he was implicated in investigations.
He had also not fled while being informed that he was implicated, said Nzuza. He had left South Africa after he was told he was implicated and “did not have the slightest temptation to spirit myself away, and I returned to the Republic of South Africa at all times”.
He said he took the matter seriously and hoped it would be finalised expeditiously, “particularly as my name is all I have”.
Magistrate Garth Davis granted Nzuza bail with the following conditions:
He surrender his passport.
He refrain from accessing information or reports from anyone in the municipality relating to this case.
He not get involved in disciplinary hearings related to this case or influence any tender processes.
He not leave the province or enter any ports of entry without written consent from the investigating officer. Advocate Doda Madonsela, acting for Nzuza, questioned why Nzuza’s cellphone was taken from him by police and not in the presence of his attorney. He said they were notified that the phone was sent for information downloading, and this was without Nzuza’s consent.
However, Lucken insisted that the police had notified Nzuza that his phone would be returned to him after it was sent for downloading and mirror imaging.
DA caucus leader in the city, Nicole Graham, called for an urgent council meeting to suspend Nzuza.
The IFP’s Mdu Nkosi echoed the call for Nzuza’s suspension.
He said that justice had finally been served on Nzuza, who as an accounting officer “should have been the first arrest”.
EThekwini Municipality spokesperson Mandla Nsele said the charges against Nzuza would not affect service delivery. The city did not comment on whether Nzuza would be suspended.