This week’s high court judgment ordering Mshushisi Daniel Mthimkhulu to pay the Passenger Rail Agency of South Africa (Prasa) R5,771,854.39 (R5.7-million) in damages, resulting from his employment in an executive position based on his fabricated CV, is a rare but necessary legal remedy to curb corruption, particularly at state-owned entities.

The judgment sets an important precedent in dealing with corrupt state officials in the future, hitting them where it hurts most, in their pockets. Other fraudsters should sleep with one eye open.

Mthimkhulu’s story goes back to 1 April 2010, the day he was promoted to be Prasa’s executive in charge of engineering services. That made him the rail operator’s head engineer. The position required, as a minimum, an engineering diploma or degree.

In his CV Mthimkhulu claimed he had obtained a national diploma in mechanical engineering from the Vaal University of Technology and from Wits University he had earned a “degree in mechanical and maintenance engineering”, found Judge Leonie Windell of the South Gauteng High Court in her judgment.

Except that the only engineering skill Mthimkhulu had obtained was the ability to doctor his own CV.

For the following 63 months, Mthimkhulu masqueraded as a top engineer, deliberately and fraudulently inducing Prasa to pay him an additional R7,072,281.04 over the period. That equates to a gross salary of R112,258.43 per month.

Yet his real highest qualification was only a matriculation certificate.

Having sensed Prasa’s gullibility, and tasted both success and money in his own corruption, Mthimkhulu grew a little more ambitious. And greedier.

In September 2010 he presented Prasa’s then CEO, Lucky Montana, with a fake letter offering him a job as an engineering services specialist in a German company, DB Schenker.

The salary offered was €200,000 a year. That was a not insignificant R2,800,000 at the time. Prasa countered and matched the offered salary to retain Mthimkhulu’s services, court documents show. This almost doubled Mthimkhulu’s salary as before this increment his total package was an annual R1,650,000, the court judgment shows.

Sometime before or after presenting Montana with the purported job offer, Mthimkhulu convinced Montana that he had also earned an engineering doctorate from the Technische Universitat Munchen. The increase in Mthimkhulu’s salary bumped up his total pay in the years to July 2015 to a staggering R15,174,459,40. That is a gross monthly pay of R240,864.43 for each of the 63 months he fraudulently stayed in the job.

When journalist Leanne George blew Mthimkhulu’s cover in a report for Beeld newspaper and website News24, Montana effectively accused her of racism. Yet a few weeks later both Montana and Mthimkhulu would be out of their jobs at Prasa, with Montana having resigned under pressure as the board was investigating him for corruption in the procurement processes in which Mthimkhulu had been central.

After the media reports, together with the revelation that Mthimkhulu was not registered with the Engineering Council of South Africa as required, he was suspended a week after Montana resigned.

Mthimkhulu’s long-running April Fool’s joke, which was no joke, ended in dismissal 63 months later. In August 2015, Mthimkhulu was found guilty of doctoring his CV and fired. Not satisfied with firing him, Prasa pursued him in a civil claim for damages at the high court, demanding he pay back his ill-gotten salary.

Prasa executive Fani Dingiswayo, who spearheaded the case from the legal risk and compliance office, former rail division executive Mosenngwa Mofi, and a Mr Phakathi, who acted as human resources head for a while, ensured Mthimkhulu would be held accountable and pay for his crimes against the utility.

This week judge Windell brought the costly saga close to the end when she ordered Mthimkhulu to compensate Prasa part of the salary he was paid as a result of his fraudulent misrepresentations.

Strangely, however, the judge ordered Mthimkhulu to pay back only the R5.7-million he was paid at Prasa after lying about a non-existent job offer and having obtained a doctorate.

Wrote Judge Windell: “I am satisfied that all the elements of the plaintiff’s (Prasa’s) cause of action have been established.”

Among those is that Prasa has shown, and the judge accepted, that it suffered damages amounting to R7,072,281.04 in additional payments to Mthimkhulu after he lied about the German job offer and the fake doctorate.

But the judge ordered he repay only the R5.7-million (plus interest at 9% per annum) Prasa paid Mthimkhulu after lying about being in possession of engineering qualifications and before the doctorate. Mthimkhulu was also hit with the costs of the case at a punitive scale. The amount, including Prasa’s cost of employing two counsel for the case, is yet to be determined.

It may all end up being an academic exercise resulting only in Mthimkhulu’s sequestration without recovering all the monies, but Judge Windell’s ruling sets an important precedent in dealing with corrupt and errant employees who have abused their positions at state-owned entities.

Perhaps not so strangely, Mthimkhulu still has one unwavering supporter. Lucky Montana spent many hours on Twitter since the judgment on Monday defending Mthimkhulu.

On the day of the judgment, among Montana’s many tweets on the matter was this: “It’s really unfortunate that South Africans equate academic qualification with competence to do the job. When a position is advertised, it will state the academic qualification required or equivalent or experience. There are many great leaders or managers without qualifications.”

Montana insists Mthimkhulu “was a genius of an engineer” when he worked at Prasa. That’s despite Mthimkhulu being head of the team that acquired the 13 Afro 4000 locomotives in 2013 that proved to be technically unsuitable for South Africa’s railway infrastructure. Purchased from Spain’s Vossloh at a cost of R600-million, the trains proved too tall for the pylons powering the rail network.

The Supreme Court of Appeal, in a judgment affirmed by the Constitutional Court, found the total R3.5-billion contract riddled with corruption and other illegality designed to benefit winner Swifambo Rail Leasing.

Montana has a personal stake in the R3.5-billion contract. As chief executive of Prasa at the time of the contract, he bears direct responsibility for presiding over a procurement process that the Supreme Court of Appeal found “was procured through corruption”.

Montana said he will be giving his side of the story to the Zondo Commission of Inquiry into State Capture in the next few weeks, when he will also deal with the matter of the fake doctor Mthimkhulu.

Mthimkhulu will not be the only former executive of a corrupt institution worried by this week’s precedent-setting costs judgment at the high court. Rampant corruption has over the past 10 years cost state-owned entities, including the South African Broadcasting Corporation, arms manufacturer Denel and Eskom, hundreds of billions of rand.

While the people who perpetrated that corruption walk free in the absence of any criminal arrests and prosecutions, companies such as the SABC, Transnet and now Prasa have reclaimed hundreds of stolen millions by pursuing the civil cases in the courts.

Should Prasa decide to pursue its former executives for the R2.6-billion it lost in the locomotives acquisition tender, Montana may also find himself in the eye of the storm. DM