Former KZN treasury head Sipho Shabalala is expected to be sentenced on Thursday for his role in the so-called “Amigos case”, involving the award of a R44m contract for water purification plants by the provincial government, apparently in return for a R1m “sweetener” to the ANC.
And while the state is asking that he be sent to jail for as long as 15 years, a probation officer has recommended he be given five years' “house arrest”.
In June this year, Durban high court judge Dhaya Pillay found Shabalala guilty of corruption, fraud, money laundering and contravening the Public Finance Management Act — offences which attract long prison sentences.
The judge acquitted his wife, Beatrice.
The first arrests in the “Amigos” case — so named because it was how some of the accused referred to each other in correspondence — were made in 2010.
At that time there were 23 accused, including ANC heavyweights Mike Mabuyakhulu and Peggy Nkonyeni.
But charges were withdrawn against them and others over the years.
The contracts were given to Cape Town-based businessman Gaston Savoi's Intaka Holdings and the money came from the poverty relief fund.
The Shabalalas applied for, and were granted, separation of their trial.
It was initially alleged that Savoi paid more than R1m into then attorney Sandile Kuboni’s trust account as a “donation” to the ANC as thanks for contracts. But it emerged in evidence during Shabalalas’ trial that some of the money was used to pay expenses related to a farm owned by Shabalala and a company Blue Serenity, a Shabalala entity that owned a hotel in Pietermaritzburg.
Shabalala did not testify during the trial.
On Tuesday, when the sentencing proceedings began before Pillay (now sitting in Pietermaritzburg), senior state advocate Mlu Magwanyana argued for a stiff sentence, as much as 15 years' imprisonment.
He said Shabalala had been entrusted with public money and some of the purification plants were still “collecting rust”.
He said there was no analysis done on the need for them.
But the probation officer, Innocentia Mpumelelo Shiba, in her report to the court, said direct imprisonment would expose him to “hardened criminals” — and he had already been punished “through his loss of power” when he was forced to resign (because of the pending criminal case) in 2011.
She recommended that he pay a fine and be sentenced to correctional supervision, where he would be placed under house arrest for five years, which would be “more restorative and rehabilitative”.
Shiba said Shabalala, who is now 56, had told her he was disappointed in himself after his conviction.
However, she said, he did not acknowledge responsibility for the crimes because he was just “executing orders from his principals”.
In fact, she said, he told her he had fought corruption while in office.
She said he was a “family man” who earned an income through sugar farming.
Shiba said she had also interviewed Siphiwe Mahlangu, director of forensic audit in the National Treasury, who told her that while he would abide by the decision of the court “the sentence should send out a strong message to like-minded 'looting' public servants who are meant to safeguard scarce, and limited resources” for vulnerable people.
Mahlangu had also said the sentence should restore confidence in the justice system.
Pillay, pointing out that the funds had come from the poverty relief fund — destined for the poor — and that they were used in a fraudulent manner, asked Shiba if she wanted to change her opinion on the sentence.
She replied: “No”.
Before his arrest, the Asset Forfeiture Unit seized Shabalala’s assets, including a farm, the hotel in Pietermaritzburg, a guest house, and two restaurants, said to be worth more than R5m at the time.
A final forfeiture of whatever assets are still being held by the curator is pending. Savoi, Kuboni and the other accused will be back in court on November 14.
Their trial is on hold because Savoi has launched several pre-trial applications, including one challenging the constitutionality of the Prevention of Organised Crime Act (Poca) and another for a permanent stay of prosecution.
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Former KZN treasury head to be sentenced in Amigos case
Image: Sandile Ndlovu
Former KZN treasury head Sipho Shabalala is expected to be sentenced on Thursday for his role in the so-called “Amigos case”, involving the award of a R44m contract for water purification plants by the provincial government, apparently in return for a R1m “sweetener” to the ANC.
And while the state is asking that he be sent to jail for as long as 15 years, a probation officer has recommended he be given five years' “house arrest”.
In June this year, Durban high court judge Dhaya Pillay found Shabalala guilty of corruption, fraud, money laundering and contravening the Public Finance Management Act — offences which attract long prison sentences.
The judge acquitted his wife, Beatrice.
The first arrests in the “Amigos” case — so named because it was how some of the accused referred to each other in correspondence — were made in 2010.
At that time there were 23 accused, including ANC heavyweights Mike Mabuyakhulu and Peggy Nkonyeni.
But charges were withdrawn against them and others over the years.
The contracts were given to Cape Town-based businessman Gaston Savoi's Intaka Holdings and the money came from the poverty relief fund.
The Shabalalas applied for, and were granted, separation of their trial.
It was initially alleged that Savoi paid more than R1m into then attorney Sandile Kuboni’s trust account as a “donation” to the ANC as thanks for contracts. But it emerged in evidence during Shabalalas’ trial that some of the money was used to pay expenses related to a farm owned by Shabalala and a company Blue Serenity, a Shabalala entity that owned a hotel in Pietermaritzburg.
Shabalala did not testify during the trial.
On Tuesday, when the sentencing proceedings began before Pillay (now sitting in Pietermaritzburg), senior state advocate Mlu Magwanyana argued for a stiff sentence, as much as 15 years' imprisonment.
He said Shabalala had been entrusted with public money and some of the purification plants were still “collecting rust”.
He said there was no analysis done on the need for them.
But the probation officer, Innocentia Mpumelelo Shiba, in her report to the court, said direct imprisonment would expose him to “hardened criminals” — and he had already been punished “through his loss of power” when he was forced to resign (because of the pending criminal case) in 2011.
She recommended that he pay a fine and be sentenced to correctional supervision, where he would be placed under house arrest for five years, which would be “more restorative and rehabilitative”.
Shiba said Shabalala, who is now 56, had told her he was disappointed in himself after his conviction.
However, she said, he did not acknowledge responsibility for the crimes because he was just “executing orders from his principals”.
In fact, she said, he told her he had fought corruption while in office.
She said he was a “family man” who earned an income through sugar farming.
Shiba said she had also interviewed Siphiwe Mahlangu, director of forensic audit in the National Treasury, who told her that while he would abide by the decision of the court “the sentence should send out a strong message to like-minded 'looting' public servants who are meant to safeguard scarce, and limited resources” for vulnerable people.
Mahlangu had also said the sentence should restore confidence in the justice system.
Pillay, pointing out that the funds had come from the poverty relief fund — destined for the poor — and that they were used in a fraudulent manner, asked Shiba if she wanted to change her opinion on the sentence.
She replied: “No”.
Before his arrest, the Asset Forfeiture Unit seized Shabalala’s assets, including a farm, the hotel in Pietermaritzburg, a guest house, and two restaurants, said to be worth more than R5m at the time.
A final forfeiture of whatever assets are still being held by the curator is pending. Savoi, Kuboni and the other accused will be back in court on November 14.
Their trial is on hold because Savoi has launched several pre-trial applications, including one challenging the constitutionality of the Prevention of Organised Crime Act (Poca) and another for a permanent stay of prosecution.
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