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PHOTO: Felix Dlangamandla, Gallo Images, Netwerk24
- Nine suspects, including former city officials, and six companies have been arrested on charges of fraud and corruption.
- They were warned to report to the Hawks on Friday morning.
- The arrests are part of the second stage of an investigation by the Hawks.
Nine suspects, including two former Nelson Mandela Bay municipality officials, and six companies will be charged with fraud and corruption worth more than R56.4 million.
The suspects were warned to turn themselves in to the Hawks Friday morning and are expected to appear in Port Elizabeth Magistrates Court.
Hawks spokesman Lt. Col. Philani Nkwalase said the suspects include two former Nelson Mandela Bay Township officials, two influential community officials and five businessmen.
“The aforementioned nine natural persons will be charged along with six legal persons (entities / companies),” said Nkwalase.
A tenth suspect who was to be arrested recently died.
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Nkwalase said the municipality was selected for a fast bus system in 2010 and the Integrated Public Transportation System (IPTS) project was managed with funds allocated by the National Treasury.
“In the same year another project called Implementation and Maintenance of an Institutional Contract Management and Administration System (ICMAS) was undertaken,” he said.
He said the service providers chosen for these two projects were allegedly “irregular” and their prices were allegedly inflated.
“The matter was reported to the Hawks for their investigation in September 2018 following an audit report from the National Treasury between October 2014 and March 2017.”
It is alleged that the suspects operated a union with the common purpose of illegally circumventing prescribed hiring processes to irregularly and fraudulently benefit specific suppliers or consultants.
In addition, it is alleged that influential officials conspired with municipal officials and controlled decision-making in the appointment of specific individuals to critical municipal positions.
“This was allegedly done to influence the procurement processes, as well as the appointments of entities willing to promote the interests of the union,” added Nkwalase.
The purported goal was to ensure a steady stream of illegal payments from the municipality to union members, where the funds were distributed to other union members.
According to Nkwalase, this constitutes the second stage of his investigation.
In the first leg in April 2017, the Hawks arrested six people, including two company directors, an entity, a city official and a person from the Eastern Province Rugby Union.
The suspects are due to appear in court on Friday.
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