Joint media statement: Service provider ordered to pay back over R27 million earned fraudulently to Water and Sanitation department
The High Court of South Africa: Gauteng Division, Pretoria has ordered Metric Industrial Suppliers CC to pay back more than R27 million earned fraudulently to the Department of Water and Sanitation.
The supplier submitted fraudulent invoices to the Department between April 2006 and November 2009. The invoices were of goods that were never purchased by the Department from the supplier nor delivered by the supplier to the Department.
Former head of the supply chain management at the Department, Rick Nel created fictitious purchase orders and delivery notes in respect of invoices submitted by Anand Pillay of Metric Industrial Suppliers and accepted by Nel, supposedly acting on behalf of the Department.
Pillay and Nel colluded to defraud the Department. In one on many fraudulent transactions, the documents reflect that the purchase order was dated 8 May 2007 but the service delivery note and invoice were both dated 24 April 2007. The anomaly in the supposedly transaction is that the actual delivery had taken place prior to the goods even being ordered. This was against the Departmental policies and the procurement regulations.
The fictitious purchase orders, delivery notes and invoices were for delivery and supply of timber and shutter boards in Levubu, Thohoyandou.
The Special Investigative Unit (SIU) investigated the transactions as part of Presidential Proclamation R54 of 2012. The Proclamation authorized the SIU to investigate all issues relating to the procurement and contracting for goods, works services by or on behalf of the department and payments made in relation thereto.
The SIU investigations uncovered evidence that points towards the commission of the offences of fraud, theft and the contravention of the provision and combating of corrupt activities Act, No 12 of 2004 on the part of Nel and Pillay.
Accordingly, the court ruled that:
- Metric Industrial Suppliers is ordered to pay the Department of Water and Sanitation R27 510 067, 17 together with interest thereon at the prescribed rate of interest from time to time, calculated from 11 February 2014
- Metric Industrial Suppliers is ordered to pay the Department’s legal costs.
Enquiries:
Sputnik Ratau
Spokesperson
Department of Water and Sanitation
Tel: 0123 366 813
Cell: 082 874 2942
E-mail: RatauS@dws.gov.za
Mr Kaizer Kganyago
Head of Stakeholder Relations and Communications
Special Investigating Unit
Tel: 012 843 0048
Cell: 082 306 8888
E-mail: kkganyago@siu.org.za
