Suspended Ithala Development Finance Corporation chief executive Sipho Shabalala must be arrested, the DA in KwaZulu-Natal said.

“While the Democratic Alliance is gratified by news of Shabalala’s suspension, we are yet to see his so-called ‘imminent arrest’,” DA member of the KwaZulu-Natal legislature Johann Krog said in a statement.

Shabalala was suspended on Friday following reports of a criminal investigation against him.

Shabalala’s assets including the City Royal Hotel in Pietermaritzburg, his Othandweni farm, Range Rover and Mercedes-Benz were seized during a R200 million tender fraud crackdown by the Hawks and the Asset Forfeiture Unit last week. Eight people were arrested during the raids, but Shabalala was not.

The eight allegedly defrauded the KwaZulu-Natal health department by inflating the prices of hospital water purification equipment.

Krog said corruption was one of the reasons why the provincial health department was set to overspend its 2009/2010 budget by R2 billion.

“Allegations that irregular procurement procedure is commonplace within several provincial government departments, by way of three quotations from family, friends and comrades, rather than the open tender process, are extremely concerning.”