Joburg's insider trading
Police and the Hawks are to investigate criminal allegations related to the awarding of contracts worth more than R100-million to companies owned by City of Johannesburg employees.
Confirmation of the police's involvement in the investigation is contained in a management report by the auditor-general.
Presented to the city's public accounts committee, the report confirms that 27 allegations of criminal conduct have been referred to the police, resulting in 11 arrests.
A total of 88 cases have been identified by the auditor-general and investigated by the city in the past two financial years.
The report also reveals that:
- Eight officials resigned to avoid disciplinary action after the completion of forensic investigations;
- Six officials were fired after disciplinary hearings; and
- Twenty-eight disciplinary "processes" are under way.
The city said it would pursue criminal cases against the eight officials who resigned . But of 16 officials implicated by the auditor-general, 13 "are still employed by the city".
"[ Among] the 13 officials still employed by the city . are three who were previously implicated in the 2010-2011 report by [the] auditor-general ."
The report says two of the officials were identified as members of the audit committee.
The third served on the risk committee.
It states that Musa Minah Dondolo, who works for Emergency Management Services, was awarded a contract by the city.
Her company - Zamampondo Events and Promotions - was awarded a R29500 contract by the city's transport department. Payments to Zamampondo, of which Dondolo is said to be "an active director", were made between July 2011 and February 2012.
Dondolo was revealed to be a director of the company last month.
Draft reports recommending action against the officials were expected by the end of last month.
- The city has admitted that it does not have a system capable of reliably identifying companies bidding for business with the city that are owned by city officials.
It has claimed that it has implemented "manual interventions".
In its reply to the auditor-general's report, the city said it had asked all its departments "to start screening companies for conflict of interest with regard to the issue of company directors in the employ of the state".