More than R35-million was fraudulently transferred from municipal accounts in a 45-minute flurry last Friday.

This is according to a well-placed source at the municipality, who confirmed that the money was transferred in two batch payments, containing 15 individual transactions between 2.07pm and 2.52pm on January 31.

KwaDukuza Municipality’s (KDM) bank, ABSA, picked up the fraudulent transactions and confirmed with municipal staff that the transactions had not been authorised.

An investigation is ongoing by KDM and ABSA and it is currently unclear whether the money has been recovered. However, it is understood that contact has been made with the institutions that received the funds and they are co-operating.

A special council meeting was called to apprise councillors of the situation on Thursday, February 6 but it was in-committee and therefore not open to the public or media.

KwaDukuza spokesperson, Sifiso Zulu said the council received a report from the municipal manager.

“Council also resolved that an independent service provider be appointed to conduct an investigation. Regarding the receiving account, that will be dealt with in the report which has not been given to council at this stage,” said Zulu.

It is also understood that the municipal manager, Nhlanhla Mdakane, instructed all officials who are signatories to the account to hand over their laptops to the IT department.

Zulu said the preliminary investigations suggest an unauthorised breach of the municipality’s banking profile.

“It appears that an individual or group deliberately interfered with the municipality’s financial systems, leading to an infiltration of our primary bank account,” he said.

Immediate action on the day included instructing ABSA to block the municipal bank account to prevent additional unauthorised transactions. A case was also opened at KwaDukuza Police Station that afternoon.

“At this stage, what we can report is that the matter is under investigation by ABSA, which will inform the municipality of their findings in due course,” said Zulu.

ABSA has since sent an official to the municipality to gather information that could aid the ongoing investigation. In the meantime, all municipal payments have been halted pending a full report on the incident.

Zulu acknowledged the disruption this has caused for creditors and assured them that the municipality is working closely with ABSA to find a secure way to fulfil its financial obligations.

“We urge our creditors to bear with us during this time. Additionally, we appeal to those who owe payments to the municipality to continue making deposits, as incoming funds are not affected by the suspension,” he said.