Prosecutions loom as SIU ends R1bn Umgeni Water probe
The Special Investigating Unit (SIU) has wrapped up its two-year investigation into corruption involving more than R1-billion at Umgeni Water Amanzi and has referred several cases to the security agencies and the National Prosecuting Authority (NPA).
The SIU has not yet submitted its report to President Cyril Ramaphosa, who issued the proclamation to investigate the state-owned entity, which falls under the department of water and sanitation, in 2019.
The SIU has referred a number of “matters” to the NPA and the multiagency anti-corruption task team, which is investigating them, said SIU spokesperson Kaizer Kganyago.
The matters are understood to include infrastructure, information technology and other procurement carried out by the entity from 2017.
According to the proclamation, the SIU was tasked with investigating allegations of “serious maladministration, improper and unlawful conduct” by board members, officials and employees of Umgeni.
It also received a mandate to investigate allegations that reservoirs and pumping facilities had been sabotaged to generate revenue for contractors, as well as claims of corruption
at executive level.
The SIU also investigated claims by whistleblowers inside Umgeni that former chief executive Thami Hlongwa had benefited from a corrupt relationship with companies belonging to murdered businessman Sibonelo Shinga.
Hlongwa is in hiding.
Shinga, who allegedly paid for Hlongwa’s 50th birthday party at a Cape Town hotel, was murdered in Durban in February and had been interviewed by the SIU regarding
contracts awarded to a property company he owned.
Police have still not made any arrests in connection with his killing.
The Raminet contract
The SIU is also understood to have investigated the 2017 accounting and payment software contract awarded to Raminet Technologies — then an implementing agent for information technology giant EOH, which subsequently blacklisted Raminet as a result of the corruption scandal involving its government contracts.
The EOH ceded the contract to Raminet, which is now Umgeni’s SAP service provider.
The SIU is also understood to have investigated the R300-million social-facilitation contract awarded to Shinga’s MPS Strategic Solutions and another R87-million, eightmonth deal that engaged MPS to conduct a security assessment for Umgeni.
Kganyago this week declined to provide any detail as to which matters had been referred to the security agencies for investigation.
“There have been matters referred to the National Prosecuting Authority. The matters are under investigation by the [anti-corruption task team].”
He also declined to provide details about the amounts involved. “The SIU cannot reveal any information on this at this stage.”
Umgeni, the country’s secondlargest water board, supplies municipalities in Kwazulu-natal and parts of the Eastern Cape and has been rocked by allegations of corruption and mismanagement for nearly a decade.
Umgeni’s issues have not been restricted to corruption. The entity has undergone several years of upheaval at executive and board level.
Its board was dissolved by then water and sanitation minister Lindiwe Sisulu when she took office in 2019, but subsequently the board won a high court battle against Sisulu and was reinstated last year.
Sisulu prepared to appeal the ruling, but Senzo Mchunu, who replaced her in last year’s cabinet reshuffle, has allowed the reinstated board to stay in office, ending the court battle and introducing an element of stability at board level.
A number of top executives — including Hlongwa, former chief executive Cyril Gamede, former chief financial officer and acting chief executive Nomalungelo Mkhize — have resigned amid controversies and following three forensic audit reports commissioned by Umgeni.
A source at Umgeni said this week that the board was preparing to act on the forensic reports, which had been tabled earlier this year.
“The board now wants to push ahead with consequence management and acting on the recommendations of the forensic reports. They also want clarity on the SIU report, as there may be officials who were implicated who are still within the Umgeni,’’ the source said.