The KwaZulu-Natal MEC for arts and culture is demanding that the CEO and an intern-turned-manager of a state-funded recording, music training and development agency in Durban account for spending R20.5-million in the last financial year, amid claims that they blew R2-million on personal security. Bongi Sithole-Moloi has instituted a forensic investigation into the management of Music House KZN , which was established in 2009 at a cost of R20-million. A year ago management ring-fenced R8.5-million for new recording equipment, although there is no evidence of any upgrade.According to internal documents, Themba Luthuli, a government employee seconded to Music House KZN as its CEO in March last year, and Mpendulo Ngubo spent R2,078,224 between them on hiring cars, drivers, bodyguards and protection at their homes.Sithole-Moloi has demanded a full report on Music House KZN and the issue has been reported to the department's legal services team.story_article_left1"Apart from the R8.5-million that cannot be accounted for I'm also told they received about R12-million funding for the financial year," she said.Sithole-Moloi has refused to inaugurate a new board at Music House KZN, saying it has been registered as a nonprofit company instead of a state entity without her knowledge.A board member said there was no trace in the past year of anything having been recorded by the agency charged with unearthing new artists and preventing the exodus of talent to Gauteng.But Music House KZN claims that since June last year it has recorded three community groups, 15 artists, four "indigenous" bands and 116 artists at a subsidised rate.Under playwright Mbongeni Ngema - who headed the facility from its inception in 2009 to last year - 200 artists a year were recorded at the studio in Greyville.Insiders say the MEC should ask:• How Ngubo, 25, who has matric, went from earning R10,000 a month as an intern to earning R54000 three years later under Luthuli;• How the agency was transferred from the department to become a nonprofit company yet continued to receive government funding;block_quotes_start Luthuli refused to comment on the R2-million allegedly spent on personal security, saying he had reported the matter to police block_quotes_end• Why Petros Mahlangu and Zenzele Mzimela, the agency's chief financial officer and its chairman, were appointed to restructure the agency by a former arts and culture MEC; and• How accounting firm Ubucule Accountants & Business Advisors - which is owned by Mahlangu and Mzimela - came to be involved in the restructuring.In a written response to the Sunday Times, Luthuli refused to comment on the R2-million allegedly spent on personal security, saying he had reported the matter to police.story_article_right2He said the department had seconded him to run the agency and his appointment had been ratified by the board. His mandate was to transform Music House KZN into a nonprofit music development agency.Luthuli said the former arts and culture MEC had appointed Mzimela and his board after a public nomination process.Luthuli denied that Mahlangu was a director or shareholder of Ubucule, but admitted he was an Ubucule consultant, "providing secretariat function to the process on behalf of Ubucule".Luthuli denied there was a conflict of interest when Mzimela, a director of Ubucule, the firm responsible for the restructuring, was later appointed to the board. He said Mzimela had been appointed chairman through a separate public process overseen by an independent recruitment agency.He refused to discuss Ngubo's salary, citing employee confidentiality.On Music House KZN's output, Luthuli said performance was not related to releasing tracks but rather creating an enabling environment in which to record artists...