The much plundered Tembisa Hospital was the focus of activity this week, as a Hawks raid saw detectives seizing computers and documents, their haul so large it was taken away in a panel van, and as the Special Investigating Unit (SIU) recommended that tender kingpins Hangwani Maumela and Stefan Govindraju face prosecution for fraud.
This followed the release of a preliminary SIU report proving that networks of shell corporations banked more than R1bn in dubious payments from the hospital.
Investigators uncovered evidence that Maumela and Govindraju – whose companies landed contracts worth R775m in less than two years – in some cases, provided fake documents to the Gauteng Department of Health, paving the way for a flood of payments, reports News24.
“The SIU would recommend referrals to the National Prosecuting Authority… for providing false information,” said the report.
While the criminal probe of what whistle-blower Babita Deokaran found before she was assassinated remains active, the SIU has requested that President Cyril Ramaphosa authorise a broad investigation through a presidential proclamation.
“The irregularities uncovered (are) merely the tip of the iceberg which points to serious maladministration at Tembisa Hospital as it relates to irregular procurement processes.”
The 'don' of Tembisa
Maumela, a nephew by marriage to Ramaphosa and an associate of his principal political adviser, Bejani Chauke, steered a web of companies in trade with Tembisa Hospital.
Maumela and his cousin Aluwani Maumela banked R336m in contracts from the facility, stated the report.
The SIU’s examination of supporting documents revealed a raft of irregularities, showing how hospital staff cheated the system to ensure Maumela’s companies, and others, scored their windfalls.
Investigators found that in some instances, his companies submitted fake documents.
Paperwork submitted by his companies and losing bidders revealed that handwriting on the applications of seemingly rival bidders was the same, pointing to the possibility of cover quoting, wherein entities collude and drive prices upward to secure a large profit.
“None of the winning bidders should have been appointed…(based on the irregularities in the documents submitted) these service providers should not even have been considered”, said the report.
Sources within the Department of Health described Maumela as “the don of Tembisa” who had influence with hospital management and procurement officials.
News24 previously reported that Maumela had, through a family trust, acquired property worth R310m, his portfolio stretching from Camps Bay to Sandton.
The investigation also drew links between the tender don and other businesspeople who extracted millions from the hospital.
Letterbox company baron
According to the report, companies linked to Govindraju landed contracts from Tembisa Hospital worth R437m in the space of just 18 months.
Govindraju was exposed after he took control of more than 50 entities that had been flagged by Deokaran. His takeover took place in the space of 48 hours. His connection to the companies was the final link in a chain of lovers, relatives, friends, and co-workers.
The SIU found that 16 companies of which he took charge had received payments from the Gauteng Department of Health within the past three months.
Four had provided falsified documents and the SIU recommended their findings be referred to the NPA.
The Mazibuko clan
In September, News24 revealed that four members of the Mazibuko family controlled 17 companies in business with the hospital. All the entities and R55m in payments had been flagged by Deokaran.
One company the family controlled sold plastic buckets to Tembisa, worth less than R200, for nearly R10 000 each. The SIU found that this family dynasty were the beneficiaries of R250m in trade since 2020.
Of these networks, the SIU said it found “indications of syndicate activity as numerous service providers are linked to only a few main directors”. It was unable to determine if money were moved between the businesses, as this investigative function required a presidential proclamation.
Even with a surface-level probe, the SIU established that hospital officials bent the system and circumvented checks and balances designed to prevent fraud and corruption. They recommended that hospital staff, including suspended CEO Ashley Mthunzi, face disciplinary action.
Hawks raid
Gauteng Hawks spokesperson Colonel Katlego Mogale said this week’s raid emanated from an inquiry into allegations of fraud and corruption concerning contracts under R500 000.
"These were allegedly issued as purchase orders between 2016 and 2022, and were reportedly conducted or allocated unlawfully and illegally, resulting in the hospital being prejudiced by more than R850m.
He said in some contracts, hospital staff apparently received gratification.
“The investigation team is seizing all relevant materials, including documents and electronic gadgets, deemed important in the investigation’s progress.”
At the hospital, detectives descended on the administration block and, according to sources, homed in on documents and electronic equipment.
In a Daily Maverick report, Gauteng Premier Panyaza Lesufi said: “We are doing this to honour Babita’s legacy… to fulfil our commitment that her death will not be in vain. She remains the symbol of whistle-blowing and a symbol of fighting corruption. We will leave no stone unturned in ensuring that those involved will suffer the consequences.”
“The SIU found numerous irregularities in respect of the bid documents provided to Tembisa Hospital by the successful and unsuccessful bidders, which should have led to the disqualification of the bidders. The SIU confirms the irregular appointment of service providers which caused the GDoH to suffer irregular expenditure,” the report reads.
The SIU found that the acting CEO of the hospital at the time of the irregular procurement, Dr Ashley Mthunzi, was responsible for authorising purchase order request forms which led to the irregular appointment of 13 service providers.
“This finding is based on the 27 documents received and analysed by the SIU, according to the report,” the report read.
The provincial government placed Mthunzi, along with the then Gauteng Department of Health CFO Madyo, on precautionary suspension in August.
Recommendations
Lesufi said, based on the findings of potential syndicate activity, corruption, fraud and the irregular appointment of service providers at the hospital, which led to irregular expenditure at the GDoH, the SIU had applied for a presidential proclamation – which has been supported by the provincial government.
“Once approved, the SIU will increase its scope to include the freezing of assets, among other things,” he said.
Additionally, the SIU recommended disciplinary action against Mthunzi for failing in his duties as the accounting authority at Tembisa Hospital.
The SIU added that it would recommend referrals to the National Prosecuting Authority in respect of the following service providers, for providing the GDOH with false information:
Magnolia Trading;
Sokhana Trading and Supplies;
Preliboo;
Roguepalm;
Stotleari;
Hynoforce; and
Fairg Holdings.
News24 article – SILENCED | SIU unravels R1 billion Tembisa tender syndicates (Restricted access)
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