Hawks probe R3.9bn fraud charges among Prasa deals
THE Passenger Rail Agency of SA (Prasa) says the R3.9-billion contracts it awarded to keep dozens of railway stations safe were unauthorised, unlawful, defined by alleged tender-rigging and, largely, a waste of money.
In an explosive affidavit filed at the High Court in Pretoria, Prasa group executive in charge of legal risk and compliance Onica Martha Ngoye spelled out how some of the rail agency’s executives bent over backwards to ensure that IT and security company Siyangena Technologies was awarded lucrative deals without proper tender procedures being followed.
She said this had resulted in the installation of outdated, overpriced and ineffective security systems.
Ngoye said Prasa also wanted arbitration agreements reached between itself and Siyangena set aside so that its disputes with the company could finally be aired in public, before a court of law.
While many officials agreed to speak about the rampant abuses of process and alleged tender-rigging, certain employees asked not to be named because of threats made against people “seen to be assisting the investigation”, Ngoye said.
She told how Siyangena went from providing security gates and CCTV cameras to two stations at R2.5-million each during the 2010 World Cup to scoring a R1.9-billion tender with Prasa for security to 62 train stations. That means effectively it was paid a staggering R31.5-million per station.
Two years after this deal, former Prasa chief executive Lucky Montana had approved an “extension to phase 1”, Ngoye said. This included the installation of a “fit for purpose security system at Braamfontein and Wolmerton staging yards at a cost of R97.7million”. She said Montana had no authority to do this.
Former public protector Thuli Madonsela found that the two contracts awarded by Prasa to Siyangena were unlawful. Of 216 contracts with a combined value of about R19-billion, only 13 were found by the Treasury to have been lawful.
In an application running into thousands of pages, Ngoye said Prasa’s case had been driven by its own probes conducted by Werksmans Attorneys.
Hangwani Mulaudzi of the Hawks confirmed that the unit was investigating charges of fraud, corruption and money laundering linked to certain Prasa contracts.
Two years ago, it was reported that Siyangena allegedly made unexplained payments exceeding R550million to Roy Moodley, a known ANC benefactor and friend of former president Jacob Zuma.
Prasa, under the chairmanship of Popo Molefe, went to court to argue that the R4-billion Siyangena contracts were unlawful and defined by corruption. Molefe claimed investigations had revealed that Montana “corruptly benefited” from his relationship with Siyangena.
Montana said Molefe’s investigation was illegal and criticised him for paying millions of rand in taxpayers’ money to the law firm responsible for the probe.
The court dismissed Prasa’s first challenge to the contracts, as it had failed to adequately explain its delay in launching the case.
But in March, emboldened by a Constitutional Court ruling that seemingly undermined the legal basis for the earlier decision, Prasa launched a fresh challenge.
Siyangena responded by launching an urgent application demanding proof that Werksmans was properly authorised to represent Prasa in this case by its board. This move was seemingly motivated by recent instability in Prasa, which culminated in its interim chairwoman Tintswalo Nana Makhubele resigning to take up a position as a high court judge.
Siyangena’s application will he heard in court next week.