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Sahpra to probe R850m Tembisa payments

The long list of suspicious payments and spending linked to procurement irregularities worth R850m from Tembisa Hospital is now also being investigated by the South African Health Products Regulatory Authority (Sahpra), which is working with SAPS and the Special Investigating Unit (SIU).

Sahpra CEO Dr Boitumelo Semete-Makokotlela any transgression “in terms of unethical conduct and compromising public safety will be taken seriously and be fully investigated”.

The investigation into the hospital comes in the aftermath of whistle-blower Babita Deokaran’s assassination, after found a series of dodgy payments, later uncovered as an alleged extraction network that was bleeding Tembisa Hospital dry.

A News24 investigation based on a cache of Gauteng Health Department emails and documents, obtained via hundreds of company searches, exposed a web of entities geared toward extracting cash from the hospital's coffers.

Deokaran raised the alarm about R850m in suspicious spending at the department, and tried to stop R100m in dodgy payments, just days before her death.

Weeks before her murder, she filed a report identifying 217 companies that had won contracts for the supply of medical supplies – including ventilators and surgical equipment – and recommended an urgent investigation.

Meanwhile, News24 report that a new owner now controls the 54 entities red-flagged by  Deokaran before her murder, with the group of companies responsible for the hundreds of dodgy payments from Tembisa Hospital now falling under just one man after the numerous “directors” resigned en masse.

Dr Stefan Joel Govindraju now directs the group of companies, which saw R116m in dubious trade from the hospital, his conglomerate accounting for nearly a quarter of the 217 “possibly fraudulent” entities unearthed by the whistle-blower.

News24 reports that in two days, company directors resigned almost simultaneously, and ceded control to him. The companies – shell corporations that used false addresses and exist only on paper – form part of an extraction network that scored hundreds of contracts from the hospital, providing everything from luxury leather furniture to ventilators and skinny jeans.

The News24 investigation uncovered that:

• Married couple Christine and Avikash Signarian, through 10 companies, landed R30m in trade from Tembisa Hospital. Samendran Chin, a Johannesburg sound engineer, scored R8 in deals.
• Chin and Avikash Signarian worked together and resigned after News24 posed questions to their employer.
• Former soccer star Themba Shabalala and his wife, with five entities each, were paid R15m for the supply of goods to Tembisa Hospital. This included R500 000 for a consignment of 200 pairs of children’s skinny jeans.
• Sydney Thindelo, via five entities, billed the hospital R20m within a matter of weeks for 100 bonded leather wingback chairs, at R5 000 each.
• East Rand bank employee Antionette le Roux, with her five companies, recorded at least R10m in trade.
• Meshan Govender directed five companies which, within a year of existence, saw at least 28 Tembisa Hospital contracts worth R14m.
• Kelvin Sills (24) and his five companies scored 36 deals from Tembisa, including the sale of 2 000 cotton hand towels to Tembisa Hospital at R230 each.

All the deals were valued under R500 000, which allowed the hospital’s CEO to sign off after obtaining three quotes. Awarding contracts with a value below this threshold saw officials skirt a public and strict procurement process.

All abandoned their directorships at the same time and handed over control to Govindraju.

Govindraju – company king

After exhaustive efforts to contact Govindraju by telephone, he was eventually reached via messaging service Telegram. He would not agree to an interview and would not take calls, saying questions should be posed in writing. At first, he insisted that questions had not reached him.

Thereafter, he told News24 he needed to consult an attorney, and then he was further delayed because of a religious holiday. He had not responded at the time of publishing. He has blocked this News24 reporter on Telegram.

In three visits to a house in Primrose, the official business address of all 54 entities according to the Companies and Intellectual Property Commission (CIPC) information, there was no answer. Visits were conducted both during weekday office hours and over the weekend.

CIPC information further revealed that he is the director of at least 25 other entities. What they do could not be independently verified.

Under investigation

Sahpra has already opened a case of fraud with the Hawks, with companies previously linked to Christine and Avikash Signarian – and their alleged unlicensed supply of medical products – as the point of focus. Govindraju, as newly appointed director, will inherit this investigation and that of the SIU, which is currently under way.

Investigations would not only centre on who was in control of the entities at the time the tainted deals were concluded, but also on the companies as juristic persons.

Former company bosses have closed ranks and refused to answer questions.

One little-known operation called Gentagystix, which secured deals from Tembisa Hospital, and which was also highlighted by Deokaran, is part of Govindraju’s stable of companies.

Former director Raoul Ramkisson Singh was evasive when contacted by News24, insisting he knew nothing of the company’s operation – even though he was the sole director for six years.

CIPC spokesperson Charmaine Motloung said that because changes in directorship are daily occurrences, and even with the number of entities transferred to Govindraju’s control, it did not trigger red flags around fraudulent or suspicious activity. The commission, she said, did not verify business addresses provided during the company registration process and relied on “trust”.

She said: “Most information components (addresses included) are provided on a trust basis from customers upon registering a company or submitting any other maintenance documents. What should be understood is the legal purpose of providing the registered address upon the registering of a company and the requirement to update the CIPC.

“It is to confirm the legal address for the service of legal documentation. If the wrong address is provided, and legal service occurred, the legal process may continue without them participating in it.

“At this stage, the case is being assessed based on the information received. It will then be evaluated if it falls within the mandate of the CIPC. If it does, then an inspector will be appointed to investigate the case.”

In unison, 12 directors of 54 companies moved to distance themselves from the entities: that the power transfer occurred in the space of two days, and was shifted to one person, points to an ordered effort.


News24 article – SILENCED | How Tembisa Hospital’s R500k skinny jeans supplier and shell corporation bosses flew the coop (Restricted access)


See more from MedicalBrief archives:


ANC bigwigs score millions from Tembisa Hospital


Tembisa Hospital pays footballer and wife R500,000 for skinny jeans contract


Uncovering the 200 suspicious Tembisa Hospital contracts flagged by Deokaran


News24 article – Sahpra probes dodgy procurement contracts at Tembisa Hospital worth R850m (Open access)


Tembisa Hospital audit buried for a year and recommendations ignored


Tembisa Hospital CFO and Gauteng Health boss suspended as SIU begins probe


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