Big fish have been fraudulently lining their pockets with hundreds of millions of rands taken from the provincial department of social development.
Using different scams, including overcharging and non-existent companies, unscrupulous businessmen and their crooked government connections have cheated the KwaZulu-Natal government of huge amounts, according to a year-long forensic audit commissioned by MEC for Social Development Meshack Radebe.
"These are well-known people, driving posh cars who are milking the department and who have the money to do anything.
"But I am ready to expose them and face the music," Radebe said at the Pietermaritzburg legislature on Tuesday.
Radebe has been on a crusade to eradicate corruption in his department since taking over in November in 2007, and on Tuesday revealed the depth of corruption.
"The findings are shocking. A syndicate has been formed that has been draining this government department for years, and now the culprits will be brought to book," Radebe said.
Tenders have been awarded to companies that do not exist, or have not been legally registered.
Ten security companies were identified as having charged for services which were not provided.
Government employees have been identified who had colluded with these companies in defrauding the department of more than R20-million, he said.
Computers worth R3-million were ordered and paid for, but never reached the department.
In one of the most costly misdemeanours, it was discovered that a company was paid R172-million in tax, even though it was not registered with SARS.
Another company awarded a tender for R8,1-million was found not to be a legally registered company.
The media were given sight of a summary report of the findings of the forensic investigation, where names of companies and individuals involved were blocked out.
"Only once the police have completed their investigations and people have been arrested and charged, will we reveal names," Radebe said.
From the summary report however, it is clear that the department has been blindsided by numerous acts of fraud over recent years.
There was a large amount of money paid by the department to eight fraudulent companies, which far exceeded the amount that would have been paid had it contracted a State Information Technology Agency supplier.
Equipment supposed to have been delivered to the department cannot be found.
Exorbitant prices were being quoted and paid by the department in excess of normal prices, Radebe said.
The provision of private security services has also come under fire when it was discovered that most of the companies that had tendered and been awarded security projects by the department were not registered with the Private Security Industry Regulatory Authority (PSIRA).
Employees of the department were also found to have colluded with suppliers of goods/services to the department to fraudulently manipulate the procurement of policies and practices of the department.
Thirteen employees have been identified as being involved in fraudulent activities.
Payments made to four entities totalling R11007 000 were identified as having been made through the manipulation of the electronic payment system.
There are no records within the department to support these payments.
Radebe confirmed that there were other transactions that still had to be investigated amounting to more than R30-million. "This is just the tip of the iceberg.
Police will now join forces with the department to bring these criminals to book. This money must be recovered as quickly as possible," Radebe said.
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