Former Newcastle municipal manager, CFO in court for alleged R7.8m fraud

30 September 2022 - 15:49 By Mfundo Mkhize
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The former Newcastle municipal manager Bhekani Mswane is among three arrested for allegedly defrauding the municipality of R7.8m. Stock photo.
The former Newcastle municipal manager Bhekani Mswane is among three arrested for allegedly defrauding the municipality of R7.8m. Stock photo.
Image: 123RF/Olivier Le Moal

Richmond municipal manager Bhekani Mswane was granted R20,000 bail after appearing in the Durban commercial crimes court on fraud and money laundering charges.

The charges relate to his previous employment at the Newcastle municipality in KwaZulu-Natal.

The 54-year-old was joined in the dock by Bhekisisa Hlongwe, 41, the municipality's CFO, and Velenkosini Mtshali, 44, sole director of Bonakude Consulting (Pty) Ltd which provided consulting services to the municipality. 

The National Prosecuting Authority in KwaZulu-Natal said: “The state is alleging that between 2018 and 2019 the men colluded to illegally extend an expired contract for Bonakude to provide consulting services to the municipality.

“It is also alleged that Mswane and Hlongwane contravened the Municipal Finance Management Act by incurring irregular and wasteful expenditure. A further allegation is that Mtshali and Bonakude received the proceeds of the unlawful activities of Mswane and Hlongwane, when they were paid for the non-existent contract.”

A total of R7.8m of municipal funds was lost in the allegedly fraudulent activity.  

The accused handed themselves over to the police after they were made aware of their imminent arrests. It is understood they intend to plead not guilty to the charges.

Prosecutor Nevas Heeralall said the state would not oppose bail.

Magistrate Dawn Soomaroo deemed the charges as serious as public funds had allegedly been used in the commission of the offence. However, she granted the accused bail.

Among the conditions imposed is that they hand over their passports by Monday.

They were ordered not to venture into the premises of the Newcastle municipality until the matter was finalised. Two of the accused are still employed by the municipality.

They were also ordered not interfere with the state witnesses.

The case was adjourned to November 1.

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