SIU details Tembisa Hospital corruption networks that looted billions

Most of the companies that benefited from the looting at Tembisa Hospital were essentially shell entities that were no longer operational.

On Monday, the Special Investigating Unit (SIU) revealed that during its probe into Tembisa Hospital, it uncovered three coordinated syndicates responsible for looting more than R2bn.

The scandal first came into the national spotlight after the assassination of whistle-blower Babita Deokaran in August 2021.

Deokaran, who was the chief director of financial accounting in the Gauteng department of health, was gunned down shortly after dropping off her child at school. It later emerged that her killing was linked to attempts to keep her from exposing the fraudulent networks siphoning millions of rand from the hospital.

In September 2022, the office of the Gauteng premier signed a secondment agreement with the SIU to conduct a forensic investigation based on Deokaran’s explosive report of August 4 2021.

Her analysis had revealed that 63% of purchase orders worth between R400,000 and R500,000 issued between April and July 2021 were linked to Tembisa Hospital, an unusually high proportion compared with other large provincial hospitals.

Procurement manipulation

The SIU investigation has so far identified 207 service providers involved in 4,501 purchase orders, many of which are linked to fraudulent procurement processes.

SIU head advocate Andy Mothibi said service providers were appointed using fraudulent documents for a manipulated three-quote system designed to bypass the tender process, keeping transactions under R500,000.

“This deliberate splitting of orders violated Gauteng department of health procurement policy, which prohibits subdividing requirements to evade competitive bidding,” Mothibi said.

He said the investigation revealed a pattern of collusion between officials and service providers, significantly undermining the purpose of healthcare budgets.

“Numerous invoices showed collusion, with separate invoices generated for similar amounts on the same day or within a short time frame,” Mothibi added.

The SIU also found that normal procurement controls, such as purchase request forms, fair vendor selection, and compliance with central supplier database guidelines, were bypassed. Officials either actively participated in the malpractice or turned a blind eye, allowing the hospital’s funds to be looted.

Assets and referrals

The SIU reported that to date it has:

• identified about R1.08bn in potential cash and assets to be recovered;
• 116 referrals for disciplinary action against officials and executives;
• 190 referrals for administrative action;
• four referrals to the National Prosecuting Authority;
• 14 investigations closed under a published proclamation;
• almost R54m referred for civil proceedings.

The syndicates

The SIU identified three major criminal networks:

• Maumela syndicate: linked to businessman Hangwani Morgan Maumela. Investigators are reviewing 1,728 bundles worth R816.5m. At least 41 suppliers are tied to him, including three companies linked to Vusimuzi Matlala, which were awarded contracts worth R13.5m.
• Mazibuko syndicate: linked to Rudolph Mazibuko. The SIU reviewed 651 bundles worth R283.5m, uncovering assets worth R42.6m, including multiple properties in Gauteng and the Western Cape.
• Syndicate X: leader not yet named. Investigators are probing 1,237 procurement bundles worth R596.4m, with evidence of laundering funds through conduit accounts. Assets valued at R150m have been identified.

Some smaller networks have also been flagged:

• Syndicate A: R9.6m (three service providers)
• Syndicate B: R76.4m (six service providers)
• Syndicate C: R8.6m (five service providers)
• Syndicate D: R37.5m (six service providers)
• Syndicate E: R3.4m (four service providers)
• Syndicate F: R28.9m (three service providers linked to one director)

The report details massive fraud, with R2bn leaving the department for no services delivered. Yet all the leadership responsible for these funds appears blameless. This level of corruption is not feasible without senior people shutting down investigations and accountability systems

—  Prof Alex van den Heever, public health governance expert

Mothibi said the ongoing investigation continues to reveal “new connections and irregularities”.

Mixed reactions

Public health governance expert Prof Alex van den Heever expressed concern that the report appeared to absolve senior leaders.

“The report details massive fraud, with R2bn leaving the department for no services delivered. Yet all the leadership responsible for these funds appears blameless. This level of corruption is not feasible without senior people shutting down investigations and accountability systems,” he said.

He also criticised the lack of decisive action since Deokaran’s murder.

“At the very least, one must conclude that leadership at provincial and national levels is either incapable or unwilling to act. Not one implicated director has been blacklisted, let alone MECs or accounting officers removed,” he said.

Treatment Action Campaign Gauteng chairperson Monwabisi Mbasa said corruption had been allowed to persist at Tembisa.

“We want to see all recommendations actioned with clear timelines. We are not happy that service providers are not blacklisted,” he said.

Ahmed Kathrada Foundation director Neeshan Balton said the report signalled progress, with syndicates identified and assets frozen.

“Our concern is that what happened at Tembisa has happened in many other institutions. Preliminary investigations are needed elsewhere. The tragedy is that corruption has taken away resources meant for patients, undermining quality care,” he said.

Gauteng premier Panyaza Lesufi said the preliminary report was part of government’s broader anti-corruption drive.

“This probe needs to be expanded to other hospitals. We are ready to implement the findings. We view this as a critical step in honouring Babita Deokaran’s legacy. The people of Gauteng deserve accountability, and we will leave no stone unturned,” Lesufi said.

Health minister Dr Aaron Motsoaledi said the SIU should conduct similar investigations in KwaZulu-Natal and the Eastern Cape.

“For junior officials implicated in corruption, the SIU must assist us to ensure they never work in government again,” Motsoaledi said.