Mogale City challenges DA to prove R9 million claims

“The Executive Mayor of Mogale City Local Municipality (MCLM), Councillor Francis Makgatho challenges Solly Msimanga to prove within seven days the allegations that his daughter benefited from the R9 million; failure to do so the Executive Mayor will take legal action against Msimanga and the Democratic Alliance (DA) in Gauteng,” read a statement from MCLM.

Lucky Sele, media spokesperson for the Mayor’s office, released the statement, which read that the DA in Gauteng is misinformed that the MCLM Mayor and Municipal Manager were involved in an attempt to defraud the municipality of R9 million.

This followed a media statement by Solly Msimanga MPL – DA Gauteng spokesperson for Cooperative Governance and Traditional Affairs (CoGTA) which was released on 14 March.

In the statement the DA said they were given reliable information that the MCLM created a R9 million invoice for Aqua, instead of paying them for services rendered to MCLM. The money was allegedly paid into a different bank account without the proper procedures being followed.

“It is alleged that the second account belonged to Motlatsi Attorneys. Once the R9 million was paid, it was immediately transferred to different accounts, raising suspicion by the bank who alerted the municipality’s Chief Financial Officer (CFO),” read the DA statement.

The statement also alleged that the Mayor’s daughter was a beneficiary of the missing R9 million.

Msimanga said the CFO did open a case with the Krugersdorp Police, and the case was later transferred to the Palm Ridge Commercial Court.

“These actions by the municipality are a gross deviation of proper public finance practices. Should a service provider ever wish to change the banking details for payment, they are required to write a formal letter to the Municipal Manager informing them about changes in their banking details. A verification process is also required to ensure the account belongs to the service provider and whether the service provider is compliant in terms of tax and other regulations before receiving any payments,” continued the DA’s statement.

The statement also said that in the nine months since the case had been opened, no one was arrested and no money was recovered.

But according to the MCLM, they wish to separate the truth from falsehood in their recent statement.

“At this stage we can confirm that the payments were made for services rendered by Messrs Aqua using ‘new banking details’ without consent of the Municipal Manager, the CFO and the Manager: Expenditure. After this occurring act, the Bank alerted the CFO of a suspicious transaction which she intercepted and immediately informed the Municipal Manager and Member of the Mayoral Committee responsible for Finance, then the Executive Mayor was duly informed.

“On 17 July 2020, MCLM opened a fraud case with police under CAS 239/07/2020. This action was initiated by the Municipal Manager, after the Municipality was alerted of the suspicious transactions picked up on its banking account by the inter-bank fraud system. To date R8,3 million in total has been recovered and was transferred back into the account of MCLM. The matter remains under investigation by police,” explained the statement from MCLM.

In his statement Msimanga also said, “Money-laundering, financial mismanagement and corruption are serious crimes that have led to the collapse of many ANC-led municipalities across the country. Mogale City is debt-ridden and service delivery remains in dire straits while millions are stolen from the coffers to enrich a few individuals in high ranks within the local government.”

But the MCLM said this information was being used to deliberately mislead the people of Mogale City as well as the province.

“The DA deliberately uses these lies because of their desperation towards Local Government Elections, having failed to lead MCLM through their coalition government at the beginning of the 2016–2021 term of office. Barely making it to a year in office, exposed that governing isn’t their forte. The DA’s last resort to misinformation and propaganda, attempts to attack the Executive Mayor and the Municipal Manager as well as attempts to remove the Speaker of Council is them sobbing over their failed attempt to lead the City and their plan to render the City ungovernable to collapse the administration in order to boost their ambition towards elections.”

Sele said the matter is still under investigation, and at the discretion of the investigating authority the Municipality could not divulge details which could compromise the ongoing investigation.