Struggling municipality's funds used to renovate Oscar Mabuyane's home

19 May 2019 - 00:06 By ZINGISA MVUMVU and MPHUMZI ZUZILE


More than R1m was siphoned from a struggling municipality in the Eastern Cape - and part of the money was then used to renovate the home of ANC provincial chair and premier-designate Oscar Mabuyane.
The Mail & Guardian reported this week that R450,000 of the money was transferred to a company that renovated Mabuyane's home in the suburb of Bunker's Hill, East London. Today, the Sunday Times can report that an invoice for R1.1m was fraudulently generated under the guise that it was for plant hire for a road construction project benefiting the municipality.
The ANC bigwig denies any wrongdoing. He also questioned why these allegations were surfacing now, almost a year after the transaction.
A probe by the Sunday Times has revealed that the fraudulent invoice was submitted by a company linked to ANC Eastern Cape provincial treasurer Babalo Madikizela, who is also the province's MEC for human settlements. The questionable invoice was generated in the ANC provincial headquarters in Calata House in April last year.
E-mails and an affidavit seen by the Sunday Times show that the initial invoice to the Mbizana local municipality was created by the ANC's provincial manager, Mongezi Dyala. Contacted for comment, Dyala confirmed that he created the invoice and sent it to the municipality using his ANC e-mail account. He said he did so on Madikizela's instruction.
He claimed, however, that the money was not for plant hire but to assist the municipality after it failed to pay taxi operators that ferried thousands of people to a memorial service for Winnie Madikizela-Mandela.
"The municipality was under pressure from taxi operators and they did not have money. The municipal manager then approached Madikizela for assistance. He [Madikizela] then asked me to pay the taxi operators from the party funds," said Dyala.
He said Madikizela instructed him to invoice the municipality for plant hire instead of transportation.
Madikizela declined to comment when contacted by the Sunday Times yesterday, saying he had already addressed the allegations in other media. The Mail & Guardian quoted him dismissing the claim as malicious. He also denied instructing the municipality to pay the invoice.
Investigations show that the money was paid by the Mbizana municipality to a company owned by Lonwabo Bam, a businessman friend of Madikizela, in July last year. At the time of the transaction, Madikizela was not an MEC but only provincial treasurer of the ANC. He was named MEC for human settlements in November.
Mabuyane, who became ANC provincial chair late in 2017 after a chaotic conference, received R450,000 from the municipality via a company owned by Bam, who invoiced it for plant hire even though he had not provided any such service.
Mabuyane, who was instrumental in President Cyril Ramaphosa's CR17 campaign in 2017, was this week named as the next premier of the Eastern Cape by the ANC's national executive committee.
The Sunday Times has seen a trail of e-mails between Bam, Dyala and Mbizana municipal manager Luvuyo Mahlaka, which include an invoice from MNT Plant Hire dated April 16 2018.
On Friday night, Bam admitted that the money he paid to the company that renovated Mabuyane's home was siphoned off from the municipality by him for work that was never done.
"I never did any work for Mbizana worth that much. I was instructed by Madikizela to submit an invoice to the Mbizana municipality claiming R1.1m," Bam said.
In a sworn affidavit to police dated April 27, Bam states that on July 24 2018 he received a call from Madikizela instructing him to invoice the municipality.
"On July 30 2018 at about 15.38pm Madikizela phoned and asked that I forward the invoice to him. Hours after I sent Madikizela the invoice, R1.1m was paid into my account."
He said he was then instructed to pay R450,000 to a company that was renovating Mabuyane's house. Mabuyane has previously claimed that the money to renovate his home was a "loan" from Madikizela.
Yesterday, Mabuyane vehemently denied all allegations of impropriety.
"I reject with the contempt it deserves any accusation that seeks to involve me in wrongdoing. I have nothing to do with that. This is just blatant malice, this issue of my loan I did last year around July. The question is, why it is coming up only now, almost a year later, if there was anything wrong? Surely you cannot rule out underhand manipulation."
He said he would subject himself to the ANC integrity commission to clear his name.
Responding to questions yesterday afternoon, Mahlaka - the municipal manager - also claimed that the R1.1m paid to Bam was for " transportation of people by the Mbizana Taxi Association".

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