More union leaders face arrest for fraud

MORE senior leaders of the South African Municipal Workers Union (Samwu) allegedly linked to the theft of more than R178 million of union funds are facing arrest, while four others are out on bail.

This emerged yesterday in the Johannesburg Commercial Crime Court during the second bail application of Sam Phaswane, one of the alleged theft syndicate members.

Phaswane, 33, of Kagiso on the West Rand, stands accused of 35 counts of fraud while he was the financial consultant for Samwu.

He allegedly siphoned more than R9.5m from Samwu’s account and channelled the money into his personal account since 2013. The court heard that Phaswane conducted six illegal transactions amounting to R9.5m.

He was arrested on February 9 and made his first attempt to be released on bail on February 16. The bail was denied after it emerged during the proceedings that Phaswane had interfered with State witnesses and threatened the investigating officer with a lawsuit, if he continued to investigate the allegations against him.

Phaswane was originally denied bail after he failed to provide the court with an authentic residential address.

The denial of bail was later upheld by the high court in Joburg.

During his second bail application yesterday, he argued that his continued incarceration was severely affecting his business interests at the Savoy Hotel in Roodepoort and Lonway Motor & Spares shop in Newlands, Joburg. He claimed he owned shares in both entities and derived a monthly income of R40 000 from them.

The prosecution, however, disputed this. It submitted a sworn statement from the investigating officer, Zenzele Sithole, proving that such details could not be found on the Companies and Intellectual Property Commission (CIPC) records.

Sithole said Phaswane had previously owned three investment companies, but these had since been deregistered following his failure to pay annual fees to the CIPC.

Due to Sithole’s sworn statement, the prosecutor, advocate Mbulelo Hermanus, used the evidence to argue against the granting of bail, saying Phaswane had no legal assets registered in his name.

Hermanus also said Phaswane’s shareholding at the Savoy Hotel could not be proved and his motor and spares business could not be located. But the court disagreed. Presiding magistrate Brian Nemavhidi said denying a person bail because he did not have assets registered in his name was against “the grain of our justice system”.

“Prisons are not meant for the poor. They are for everyone. If it was the case, then the wealthy would present their assets in court in order for them not to be jailed,” Nemavhidi said.

He granted Phaswane bail of R50 000 – the same amount of bail given to Samwu deputy secretary Moses Miya, and officials Surprise Mnisi and Zukiswa Ntsiko. The four are due back in court on January 18. The Hawks are investigating.