Thursday, 13 June, 2024
HomeMedico-LegalSIU probes health-related fraud worth billions

SIU probes health-related fraud worth billions

The Special Investigating Unit (SIU) has instituted more than R1.6bn in health-related civil action cases in the High Court and the SIU special tribunal, with the total amount being investigated estimated at R79.2bn, said its head, Andy Mothibi. It is also pursuing millions in PPE fraud.

Sixty of the cases involving R66.1bn are in the High Court and 144 cases involving R13.1bn are in the Special Tribunal, reports Business Day.

The R1.6bn cases include about R500m linked to a probe into the affairs of the office of the State Attorney regarding medical negligence claims and legal service claims.

One of them is against Advocate Hassan Ebrahim Kajee, who appeared in the Johannesburg Regional Court on 3 April on fraud charges.

He was appointed by the State Attorney to represent the state in various matters but is alleged to have inflated invoices for services not actually rendered and overcharged for services rendered: he also apparently billed for more hours worked daily than actual hours in the day and invoiced for work on different matters simultaneously.

The SIU is pursuing a civil case in the Special Tribunal against Kajee to recover about R27m involved in the apparent collusive relationship between him and former head of the Johannesburg State Attorney’s office Gustav Lekabe.

And in parallel probes, the SIU is also, along with the National Health Laboratory Services (NHLS), engaged in litigation with 16 companies to recoup more than R172m from irregularly awarded personal protective equipment (PPE) contracts.

Health Minister Joseph Phaahla revealed this in reply to parliamentary questions from DA MP Lindy Wilson who asked for details of irregular contracts and progress made to recover the monies from companies when the NHLS procured PPE in 2020.

Wilson said about 175 PPE orders were placed – at the combined value of about R993.8m – with 21 of them audited for possible irregular expenditure, reports the Cape Times.

Phaahla said the 175 PPE orders valued at R993.8m were disclosed in the NHLS 2020/21 financial year annual report.

The NHLS had indicated at the time that the full extent of overpayment was still being investigated, he said, and the inquiry could result in findings of additional irregular expenditure.

“This matter was finalised in the 2021/22 NHLS annual report at an amount of R791 623 789, which comprises R618.8m of irregular expenditure linked to administrative non-compliance and R172.7m in respect of matters under litigation.”

Phaahla said when the Auditor-General SA conducted an audit of the NHLS’ response to the pandemic, it found that the entity procured some PPE items at prices exceeding the guidelines published by the National Treasury – and a potential overpayment of R19 074 000.

The NHLS had then initiated an investigation where the prices were excessive, and reported the companies to the Competition Commission. External auditors Nexia SAB&T had conducted an extensive audit of all Covid-19 related orders.

Phaahla said the SIU had since applied to review and set aside PPE procurement entered into between the NHLS and 16 companies and to have payments declared irregular and unlawful.

It had also sought consequential relief for the recovery of monies the respondents received in relation to the impugned payments.

He said the Special Tribunal had in a judgment dated June 7, 2022, declared the respondents liable to the NHLS to repay R172 742 175 including interest, calculated from the date the NHLS had paid for the orders.

Meanwhile, the NHLS had cancelled several major procurement service contracts, including a health waste removal bid and another for laboratory coat supplies.


BusinessDay PressReader article – SIU has R1.6bn in health cases (Open access)


Cape Times PressReader article – SIU recouping PPE funds from 16 firms (Open access)


See more from MedicalBrief archives:


Rampant legal collusion in health sector corruption – MUT/Stellenbosch study


SIU finds legal practitioner corruption in negligence claims; Mkhize wants ‘no-fault’ fund


SIU: 10 advocates implicated in R100m fraud, including medical negligence claims


Eastern Cape Health: R3.8bn in unpaid bills and R37bn in legal claims





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