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Several former municipal officials from the Ngqushwa Local Municipality, based in Peddie, were sentenced to three years’ imprisonment with the option of paying a R120,000 fine after they were convicted of illegally spending and authorising R230,000 under the guise of a lavish Christmas party for the elderly in Peddie.
They were found guilty of fraud and contravention of the Municipal Finance Management Act. Peddie is one of the districts in the Eastern Cape where poverty is rife and unemployment is estimated to be about 59%.
In 2019, a Christmas party was held for the elderly in the town. “It was supposed to be a top-class party but it was a lower-class party,” Hawks spokesperson Ndiphiwe Mhlakuvana said.
Last week, former Ngqushwa municipal manager Msiwe Phyllis Mpahlwa, former acting chief financial officer Tinus Matthysen (66), former director of corporate services Mkhuseli Wiseman Mxekezo (49) and Busisiwe Mfunda (37), a former mayor’s secretary, were sentenced to three years’ imprisonment with the option of paying a R120,000 fine each.
They were arrested in 2021.
The court found that Mxekezo authorised an item of irregular expenditure – R230,000 for a Christmas Party – by signing a memorandum. No procurement processes were followed. Matthysen was found guilty of failing to prevent the money from being spent even though he was officially on leave. He further complied with an unlawful instruction from the municipal manager at the time, Mpahlwa.
Mhlakuvana said Mfunda, who wrote the memorandum requesting procurement of goods and services, was found guilty of “deliberately sourcing quotations from fictitious service providers for her personal benefit, bypassing the municipality’s supply chain management processes”.
Mpahlwa, as the accounting officer, sanctioned the irregular transaction, facilitating the unlawful payments. The crimes were picked up by auditors who referred them to the Hawks for investigation.
After her arrest and subsequent release on bail she was employed by the Bitou Municipality but later dismissed – even though the Bargaining Council found it to be unfair. She currently works for the Mbhashe Local Municipality in Dutywa. According to the Municipal Finance Management Act a manager found guilty of serious financial misconduct can face a ban from employment in the public sector for 10 years.
The entire scheme was run between 11 and 12 December 2019 and was found to exploit the municipal requirements that allowed three quotations to be used for procurement if the amount was under R200,000.
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The Special Investigating Unit is investigating the municipality, including serious cases of maladministration and the conduct of municipal officials, with a view to recovering money lost from the municipality. DM