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(i) investigation including a synopsis of the facts and findings of each case (ii) persons or third parties
responsible for each investigation
(iii) total cost to date of each investigation
(iv) appropriate steps taken against officials and third parties implicated of wrong doing in the findings of the investigation
Supplier Incident
1
DPW Property Management Trading Entity
Interest payment for losses and damages as per court order. The building was occupied by National Library of South Africa (NLSA). Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
2
DPW Property Management Trading Entity
Payment for losses and damages as per court order Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
3
DPW Property Management Trading Entity
Interest payment 257 Edison Building 6029/1028 Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
4 GM Nkondo
Three quotations were not obtained in the procurement process Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
5 Erasmus Els
Three quotations were not obtained in the procurement process Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
6 Magaga Inc
Three quotations were not obtained in the procurement process Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
7 Erasmus Els
Three quotations were not obtained in the procurement process Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
8 AIRCO
Supplier used in procurement process was not on database Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
9 L Molebatsi
Supplier used in procurement process was not on database Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
10
The Cape Craft & Design
Supplier used in procurement process was not on database Internal Investigation Task Team
No cost was involved in the process
The disciplinary process has not yet been concluded.
Micromega Quality Lowest quotation was not
(a)(ii). My department has received seventeen (17) allegations of fraud/corruption and or financial misconducts of which
thirteen (13) forensic investigations were commissioned since 01 April 2013; of the 13 commissioned, eight (08)
forensic investigations have been completed whilst five (05) are in progress.
Details of forensic and other investigations are as follows:
(b)(i) b (ii); b (iii) and b (iv) Reference should be made in the table below:
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
1. 20-Mar-2013
Possible Conflict of Interest involving a DAC audit committee member.
Audit Committee member in question was alleged to be employed by DAS Auditors, which is a subsidiary of Sekela; and that there is a conflict of interest due to Sekela being the contracted internal audit firm for the DAC, and the said
Allegation was not tested further as the implicated Audit Committee Member withdrew his membership upon being approached by the then Director General and Audit Committee Chairperson.
Third Party:X1 Audit Committee Member in question.
N/A N/A Implicated party approached to respond on the matter by the Audit Committee Chairperson.
Response from implicated party submitted to Audit Committee Chairperson and DG for finalisation
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
individual being an audit Committee member and employee of DAS Auditors.
(April & May 2013).
Implicated member resigned from the audit committee as at 28 May 2013.
2. 1-Mar-2013
Fruitless and Wasteful Expenditure
An amount of R76 120 was spent at the National Film Video and Sound Archives as a result of lack of water in the renovated building; of which R57 057 was for the emergency hire of toilets and R19 063 spent on the reconnection of the domestic water supply through DPW. It is alleged that the spending of the funds was as a result of a lack of
During 2012, renovations were done at one of the buildings occupied by the National Archives. This building is situated at 698 Church (also known as Stanza Bopape) Street, Pretoria.
According to records, during this period (when renovations were done) challenges with the water supply were experienced.
N/A R 83 320.32
N/A;The allegation was found to be baseless and the total amount of R87, 780 paid was justified.
Allegation found not to be supported, i.e. baseless.
Based on the work done it appears that the expenditure was incurred to ensure continuity of service delivery and also to ensure that National Archives, and by implication the Department, was in compliance with the OHS Act and other applicable legislation.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
planning and duplication of functions amongst employees.
The lack of water supply affected the acceptable use of sanitation facilities with possible risks to the health of officials and the public who made use of the researching resources at the National Film, Video, and Sound Archives (NFVSA) building.
Possible negative impact on service delivery if the offices had to be closed for the periods when there was no water.
The toilets were hired for the following dates:
2 July to 6 July
According to documentation and explanations provided the hiring of the toilets was stopped when the water supply to the building was restored.
Thus it is our conclusion that the complaint that fruitless and wasteful expenditure was incurred is unsubstantiated.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
2012. 25 June to 29
June 2012. 17 June to 22
June 2012. 9 April 2012 to
13 April 2012.
Motivations reflecting the reasons were attached to support the payments made for the hiring of the toilets.
The invoice amounts were paid based on the documents and motivations provided.
The hiring of toilets was stopped when the water supply was restored.
It is a statutory
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
requirement that the employer must provide its employees (officials) with a working environment that is safe and without risk to the health of its employees (officials).
3. 13-Mar-2014
Fraud through soliciting payments from beneficiaries from the ASD Incentive Programme.
An Official of the Department solicited payments from beneficiaries amounting to R11 200. This amount is made up of deposits made by the beneficiaries in amounts of R2000 or R1200 respectively requested to be deposited back to the official upon
No further Action - Matter was concluded by Labour Relations through a disciplinary process where a sanction of dismissal was reached.
X1 Official of the Department
N/AInternal Resources Used
R11, 200 The Official was Dismissed.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
withdrawal; under the pretext that the initial transferred amount by the Department was incorrect/mistake.
4. 20-Aug-13
[Audit Committee Meeting Decision (Decision Register No AC/77)]:
CAE to include the R Kelly matter in the decision register and also be added on the fraud
Funds transferred by the Department to an events service provider for securing a performance of the known USA artist – Robert Kelly at the Nelson Mandela Sports and Culture day (17 August 2013) was Misappropriated and the said artist was not available for the performance as he had gone back to his country.
Investigation done by the Hawks (National Director of Public Prosecutions).
Third Parties:X4 external service providers.
N/A (loss recovered)
Civil Case concluded – the Department recovered the loss amounting to R2,5 million suffered through the Assets Forfeiture Unit;
The Criminal Case is underway – the NPA is considering the settlement agreement proposed by the implicated individuals.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
allegations register to monitor progress of resolution.
5. 18-Sept-013
Corruption at DAC.
It is alleged that an official of the Department is committing acts of corruption with a service provider, and also received a bribe from the same service provider.
Phase 1 Investigation Completed – Misrepresentation. Findings as follows:
The implicated service provider benefited, and is still benefiting, from the fraudulent appointment mentioned in paragraph 3.1 of this report.
Possible collusion between Departmental officials and service provider to ensure that the service
Third Party:1X External Service Provider;
DAC Officials:X10 Official
R 83 320.32
≥ R6 353 793,19
Phase 1:
Metrolink EMS – Deregistration of the service provider from the Department’s Supplier Database and Omnibus created in 2012 for sourcing events service providers.
Recommended Action against the Implicated internal DAC officials has not been evidenced as having taken
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
provider is appointed to the Omnibus of Event Management Companies.
SCM and other Departmental officials, including members of the BEC and BAC, were negligent when evaluating and adjudicating the awards for the tender in respect of the Omnibus of Events Management Companies.
SCM and Finance officials were negligent when orders were issued and payments made to the service provider, as there
place though communication and follow up was made by the unit except for the above action against the external service provider (Third Party)
Phase 2:The investigation into the corruption allegations is still pending and was delayed by the availability of resources.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
were differences in information on the quotations, invoices and SBD forms that was not discovered before payments were made.
Financial Misconduct. The SCM officials including BEC and BAC members, involved in the evaluation and adjudication of this tender, as well as the Finance officials who allowed payments to be made, committed financial misconduct in terms of Section 81(2) of the PFMA.
The system of internal control
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
around the processing of tender DAC/06/11-12 was inadequate and ineffective to discover the non-compliance as indicated in this report.
The system of internal control was not effective to ensure that the differences in information provided by the service provider were discovered before the processing of payments.
It is possible that similar errors, intentional or not, have been made
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
during the appointment of service providers and suppliers for other services and goods.
Possible Reckless Trading by service provider whose proposal was used in the misrepresentation made to the department through the submission of a proposal to provide services to the Department knowing that there was a possibility that it could be liquidated due to its inability to pay its debts.
Irregular
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
Expenditure. The amounts paid to the service provider constitute “Irregular Expenditure”.
6. 12-June-2013
Allegation of theft.
Unauthorised removal/theft of CD-ROMs from old and new computers belonging to the Department by an official of the Department in the IT unit.
The allegations that computer equipment was stolen could not be substantiated.
There was inadequate management and ineffective use of the CCTV system.
Inadequate document management/record keeping.
Inadequate supervision relating to the review of documents, in particular issue vouchers.
N/A R 84 264.24
N/A N/ALapse/Weaknesses noted in compliance to policies and procedures for the removal of assets from the Department; disclosure and request for approval to conduct remunerative work outside the Department not made and supervisory controls absent.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
7. 27-Sept-13
A walk-in complaint alleging the inflating of an invoice for one of the services delivered to DAC for the Heritage Day Event in East London.
An official of the Department inflated an invoice forwarded for the bikers who appeared at the Heritage Celebrations held in East London during the 2013 financial year.
The invoice was inflated by an amount of R10 000 and the service provider was invoiced with an original printed invoice of R30 000, and another for R40 00 as submitted.
The allegation that a Motorcycle Association submitted an inflated invoice amounting to R40 000.00 via the implicated official of the Department to the Department’s events management service provider is found to be true; although it was not paid.
The implicated official acted outside of his authority when he requested the motorcycle association to provide a higher quotation, as legally the contract was between the Association and service provider, and not between the Department and the
1X DAC Official R 91 327.68
No loss since the inflated invoice was not paid, only the original R30 000 was paid.
Recommendation for DG to take Action for the misconduct against the identified official; however official’s contract ended prior to report being issued.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
Association.
8. 4-Jan-2014
SCM Irregularities involving internal and external parties (quotations). Bid rigging
A service provider who owns three companies that are registered in the Department’s database of suppliers has an arrangement with an official of the Department in the SCM unit, who informs her of the required services, approved budget from the line function and then requests 3 quotations from the implicated service provider for the services.
Two additional companies are
The allegation that quotation rigging occurred in the SCM unit was found to be true.
The allegation that an eternal service provider paid an SCM official of the Department in exchange for contracts was found to be true. This is based on:
Both the implicated service provider and the external individual that blew the whistle incriminated themselves by confirming that Daily Office Supplies paid
DAC Officials:X3 Officials
Implicated third Parties:X2 External Parties.
R 158 345.45
≥ R 2 087 288,33
The Investigation has been finalised on 20 April 2015.
A report has been prepared and being reviewed for issue to the Acting Director General and to relevant management to implement appropriate action.
The recommendation in process of communication to Management is for an internal disciplinary action to be considered against the 3 DAC
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
used for cover quoting for the implicated service provider in exchange for commission.
The implicated service provider has been paying bribes to the Department’s official amounting to 10% of each service awarded to the service provider in cash which is delivered to the official in the Department’s parking area.
the Department’s Official in exchange for contracts. This could result in criminal charges being laid against them.
At the time the service provider and external individual had a breakdown in relationship; thus it was not possible that they conspired against DAC official. In fact the external individual wanted to hurt the service provider by providing the information.
The system of internal control, especially the preventive and detective controls, within the SCM unit is
officials; and for criminal and civil cases against the external service provider/parties to instituted.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
weak.
Head of SCM misinformed implicated SCM official regarding the requirements to conduct “Remunerative Work Outside of Public Service”.
1-Mar-2013
Fruitless and Wasteful Expenditure
An amount of R76 120 was spent at the National Film Video and Sound Archives as a result of lack of water in the renovated building; of which R57 057 was for the emergency hire of toilets and R19 063 spent on the reconnection of the domestic water supply through
During 2012, renovations were done at one of the buildings occupied by the National Archives. This building is situated at 698 Church (also known as Stanza Bopape) Street, Pretoria.
According to records, during this period (when renovations
N/A R 83 320.32
N/A;The allegation was found to be baseless and the total amount of R87, 780 paid was justified.
Allegation found not to be supported, i.e. baseless.
Based on the work done it appears that the expenditure was incurred to ensure continuity of service delivery and also to ensure that National Archives, and by implication the Department, was in compliance with the
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
DPW. It is alleged that the spending of the funds was as a result of a lack of planning and duplication of functions amongst employees.
were done) challenges with the water supply were experienced.
The lack of water supply affected the acceptable use of sanitation facilities with possible risks to the health of officials and the public who made use of the researching resources at the National Film, Video, and Sound Archives (NFVSA) building.
Possible negative impact on service delivery if the offices had to be closed for the periods when there was no water.
OHS Act and other applicable legislation.
According to documentation and explanations provided the hiring of the toilets was stopped when the water supply to the building was restored.
Thus it is our conclusion that the complaint that fruitless and wasteful expenditure was incurred is unsubstantiated.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
The toilets were hired for the following dates:
2 July to 6 July 2012.
25 June to 29 June 2012.
17 June to 22 June 2012.
9 April 2012 to 13 April 2012.
Motivations reflecting the reasons were attached to support the payments made for the hiring of the toilets.
The invoice amounts were paid based on the documents and motivations provided.
The hiring of toilets was stopped when
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
the water supply was restored.
It is a statutory requirement that the employer must provide its employees (officials) with a working environment that is safe and without risk to the health of its employees (officials).
9. 13-Mar-2014
Fraud through soliciting payments from beneficiaries from the ASD Incentive Programme.
An Official of the Department solicited payments from beneficiaries amounting to R11 200. This amount is made up of deposits made by the beneficiaries in amounts of R2000 or R1200
No further Action - Matter was concluded by Labour Relations through a disciplinary process where a sanction of dismissal was reached.
X1 Official of the Department
N/AInternal Resources Used
R11, 200 The Official was Dismissed.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
respectively requested to be deposited back to the official upon withdrawal; under the pretext that the initial transferred amount by the Department was incorrect/mistake.
10. 20-Aug-13
[Audit Committee Meeting Decision (Decision Register No AC/77)]:
CAE to include the R Kelly matter in the decision
Funds transferred by the Department to an events service provider for securing a performance of the known USA artist – Robert Kelly at the Nelson Mandela Sports and Culture day (17 August 2013) was Misappropriated and the said artist was
Investigation done by the Hawks (National Director of Public Prosecutions).
Third Parties:X4 external service providers.
N/A (loss recovered)
Civil Case concluded – the Department recovered the loss amounting to R2,5 million suffered through the Assets Forfeiture Unit;
The Criminal Case is underway – the NPA is considering the settlement
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
register and also be added on the fraud allegations register to monitor progress of resolution.
not available for the performance as he had gone back to his country.
agreement proposed by the implicated individuals.
11. 18-Sept-013
Corruption at DAC.
It is alleged that an official of the Department is committing acts of corruption with a service provider, and also received a bribe from the same service provider.
Phase 1 Investigation Completed – Misrepresentation. Findings as follows:
The implicated service provider benefited, and is still benefiting, from the fraudulent appointment mentioned in paragraph 3.1 of this report.
Possible collusion between
Third Party:1X External Service Provider;
DAC Officials:X10 Official
R 83 320.32
≥ R6 353 793,19
Phase 1:
Metrolink EMS – Deregistration of the service provider from the Department’s Supplier Database and Omnibus created in 2012 for sourcing events service providers.
Recommended Action against the Implicated internal
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
Departmental officials and service provider to ensure that the service provider is appointed to the Omnibus of Event Management Companies.
SCM and other Departmental officials, including members of the BEC and BAC, were negligent when evaluating and adjudicating the awards for the tender in respect of the Omnibus of Events Management Companies.
SCM and Finance officials were negligent when
DAC officials has not been evidenced as having taken place though communication and follow up was made by the unit except for the above action against the external service provider (Third Party)
Phase 2:The investigation into the corruption allegations is still pending and was delayed by the availability of resources.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
orders were issued and payments made to the service provider, as there were differences in information on the quotations, invoices and SBD forms that was not discovered before payments were made.
Financial Misconduct. The SCM officials including BEC and BAC members, involved in the evaluation and adjudication of this tender, as well as the Finance officials who allowed payments to be made, committed financial misconduct in terms of Section
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
81(2) of the PFMA.
The system of internal control around the processing of tender DAC/06/11-12 was inadequate and ineffective to discover the non-compliance as indicated in this report.
The system of internal control was not effective to ensure that the differences in information provided by the service provider were discovered before the processing of payments.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
It is possible that similar errors, intentional or not, have been made during the appointment of service providers and suppliers for other services and goods.
Possible Reckless Trading by service provider whose proposal was used in the misrepresentation made to the department through the submission of a proposal to provide services to the Department knowing that there was a possibility that it could be liquidated due to its inability to
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
pay its debts.
Irregular Expenditure. The amounts paid to the service provider constitute “Irregular Expenditure”.
12. 12-June-2013
Allegation of theft.
Unauthorised removal/theft of CD-ROMs from old and new computers belonging to the Department by an official of the Department in the IT unit.
The allegations that computer equipment was stolen could not be substantiated.
There was inadequate management and ineffective use of the CCTV system.
Inadequate document management/record keeping.
Inadequate supervision relating to the review of
N/A R 84 264.24
N/A N/ALapse/Weaknesses noted in compliance to policies and procedures for the removal of assets from the Department; disclosure and request for approval to conduct remunerative work outside the Department not made and supervisory controls
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
documents, in particular issue vouchers.
absent.
13. 27-Sept-13
A walk-in complaint alleging the inflating of an invoice for one of the services delivered to DAC for the Heritage Day Event in East London.
An official of the Department inflated an invoice forwarded for the bikers who appeared at the Heritage Celebrations held in East London during the 2013 financial year.
The invoice was inflated by an amount of R10 000 and the service provider was invoiced with an original printed invoice of R30 000, and another for R40 00 as submitted.
The allegation that a Motorcycle Association submitted an inflated invoice amounting to R40 000.00 via the implicated official of the Department to the Department’s events management service provider is found to be true; although it was not paid.
The implicated official acted outside of his authority when he requested the motorcycle association to provide a higher quotation, as legally the contract was between the
1X DAC Official R 91 327.68
No loss since the inflated invoice was not paid, only the original R30 000 was paid.
Recommendation for DG to take Action for the misconduct against the identified official; however official’s contract ended prior to report being issued.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
Association and service provider, and not between the Department and the Association.
14. 4-Jan-2014
SCM Irregularities involving internal and external parties (quotations). Bid rigging
A service provider who owns three companies that are registered in the Department’s database of suppliers has an arrangement with an official of the Department in the SCM unit, who informs her of the required services, approved budget from the line function and then requests 3 quotations from the implicated service provider
The allegation that quotation rigging occurred in the SCM unit was found to be true.
The allegation that an eternal service provider paid an SCM official of the Department in exchange for contracts was found to be true. This is based on:
Both the implicated service provider and the external individual that blew the whistle
DAC Officials:X3 Officials
Implicated third Parties:X2 External Parties.
R 158 345.45
≥ R 2 087 288,33
The Investigation has been finalised on 20 April 2015.
A report has been prepared and being reviewed for issue to the Acting Director General and to relevant management to implement appropriate action.
The recommendation in process of communication to Management is for
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
for the services.
Two additional companies are used for cover quoting for the implicated service provider in exchange for commission.
The implicated service provider has been paying bribes to the Department’s official amounting to 10% of each service awarded to the service provider in cash which is delivered to the official in the Department’s parking area.
incriminated themselves by confirming that Daily Office Supplies paid the Department’s Official in exchange for contracts. This could result in criminal charges being laid against them.
At the time the service provider and external individual had a breakdown in relationship; thus it was not possible that they conspired against DAC official. In fact the external individual wanted to hurt the service provider by providing the information.
The system of internal
an internal disciplinary action to be considered against the 3 DAC officials; and for criminal and civil cases against the external service provider/parties to instituted.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
control, especially the preventive and detective controls, within the SCM unit is weak.
Head of SCM misinformed implicated SCM official regarding the requirements to conduct “Remunerative Work Outside of Public Service”.
Fraud through soliciting payments from beneficiaries from the ASD Incentive Programme.
An Official of the Department solicited payments from beneficiaries amounting to R11 200. This amount is made up of deposits made by the beneficiaries in amounts of R2000
No further Action - Matter was concluded by Labour Relations through a disciplinary process where a sanction of dismissal was reached.
X1 Official of the Department
N/A
Internal Resources Used
R11, 200 The Official was Dismissed.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
or R1200 respectively requested to be deposited back to the official upon withdrawal; under the pretext that the initial transferred amount by the Department was incorrect/mistake.
15. [Audit Committee Meeting Decision (Decision Register No AC/77)]:
CAE to include the R Kelly matter in the decision register and also be
Funds transferred by the Department to an events service provider for securing a performance of the known USA artist – Robert Kelly at the Nelson Mandela Sports and Culture day (17 August 2013) was Misappropriated and the said artist was
Investigation done by the Hawks (National Director of Public Prosecutions).
Third Parties:
X4 external service providers.
N/A (loss recovered)
Civil Case concluded – the Department recovered the loss amounting to R2,5 million suffered through the Assets Forfeiture Unit;
The Criminal Case is underway – the NPA is considering the settlement agreement proposed by the
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
added on the fraud allegations register to monitor progress of resolution.
not available for the performance as he had gone back to his country.
implicated individuals.
16. Corruption at DAC.
It is alleged that an official of the Department is committing acts of corruption with a service provider, and also received a bribe from the same service provider.
Phase 1 Investigation Completed – Misrepresentation. Findings as follows:
The implicated service provider benefited, and is still benefiting, from the fraudulent appointment mentioned in paragraph 3.1 of this report.
Possible collusion between Departmental officials and service provider to ensure that the service provider is appointed to the Omnibus of Event Management Companies.
Third Party:1X External Service Provider;
DAC Officials:X10 Official
R 83 320.32
≥ R6 353 793,19
Phase 1:
Metrolink EMS – Deregistration of the service provider from the Department’s Supplier Database and Omnibus created in 2012 for sourcing events service providers.
Recommended Action against the Implicated internal DAC officials has not been evidenced as having taken place though
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
SCM and other Departmental officials, including members of the BEC and BAC, were negligent when evaluating and adjudicating the awards for the tender in respect of the Omnibus of Events Management Companies.
SCM and Finance officials were negligent when orders were issued and payments made to the service provider, as there were differences in information on the quotations, invoices and SBD forms that was not discovered before payments were made.
Financial Misconduct. The SCM officials including
communication and follow up was made by the unit except for the above action against the external service provider (Third Party)
Phase 2:
The investigation into the corruption allegations is still pending and was delayed by the availability of resources.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
BEC and BAC members, involved in the evaluation and adjudication of this tender, as well as the Finance officials who allowed payments to be made, committed financial misconduct in terms of Section 81(2) of the PFMA.
The system of internal control around the processing of tender DAC/06/11-12 was inadequate and ineffective to discover the non-compliance as indicated in this report.
The system of internal control was not effective to ensure that the differences in information provided by the service provider were discovered before the
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
processing of payments.
It is possible that similar errors, intentional or not, have been made during the appointment of service providers and suppliers for other services and goods.
Possible Reckless Trading by service provider whose proposal was used in the misrepresentation made to the department through the submission of a proposal to provide services to the Department knowing that there was a possibility that it could be liquidated due to its inability to pay its debts.
Irregular Expenditure. The amounts paid to the service provider constitute “Irregular Expenditure”.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
17. Allegation of theft.
Unauthorised removal/theft of CD-ROMs from old and new computers belonging to the Department by an official of the Department in the IT unit.
The allegations that computer equipment was stolen could not be substantiated.
There was inadequate management and ineffective use of the CCTV system.
Inadequate document management/record keeping.
Inadequate supervision relating to the review of documents, in particular issue vouchers.
N/A R 84 264.24
N/A N/A
Lapse/Weaknesses noted in compliance to policies and procedures for the removal of assets from the Department; disclosure and request for approval to conduct remunerative work outside the Department not made and supervisory controls absent.
18. A walk-in complaint alleging the inflating of an invoice for one of
An official of the Department inflated an invoice forwarded for the bikers who
The allegation that a Motorcycle Association submitted an inflated invoice amounting to R40 000.00 via the implicated official of the
1X DAC Official
R 91 327.68
No loss since the inflated invoice was not paid,
Recommendation for DG to take Action for the misconduct against the identified official; however
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
the services delivered to DAC for the Heritage Day Event in East London.
appeared at the Heritage Celebrations held in East London during the 2013 financial year.
The invoice was inflated by an amount of R10 000 and the service provider was invoiced with an original printed invoice of R30 000, and another for R40 00 as submitted.
Department to the Department’s events management service provider is found to be true; although it was not paid.
The implicated official acted outside of his authority when he requested the motorcycle association to provide a higher quotation, as legally the contract was between the Association and service provider, and not between the Department and the Association.
only the original R30 000 was paid.
official’s contract ended prior to report being issued.
19. SCM Irregularities involving internal and external parties (quotations). Bid rigging
A service provider who owns three companies that are registered in the Department’s database of suppliers has an
The allegation that quotation rigging occurred in the SCM unit was found to be true.
The allegation that an eternal service provider paid an SCM official of the Department in exchange for
DAC Officials:
X3 Officials
Implicated
R 158 345.45
≥ R 2 087 288,33
The Investigation has been finalised on 20 April 2015.
A report has been prepared and being reviewed for issue to the Acting Director
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
arrangement with an official of the Department in the SCM unit, who informs her of the required services, approved budget from the line function and then requests 3 quotations from the implicated service provider for the services.
Two additional companies are used for cover quoting for the implicated service provider in exchange for commission.
contracts was found to be true. This is based on:
Both the implicated service provider and the external individual that blew the whistle incriminated themselves by confirming that Daily Office Supplies paid the Department’s Official in exchange for contracts. This could result in criminal charges being laid against them.
At the time the service provider and external individual had a breakdown in relationship; thus it was not possible that they conspired against DAC official. In fact the external individual wanted to hurt the service provider by providing the
third Parties:
X2 External Parties.
General and to relevant management to implement appropriate action.
The recommendation to Management is for an internal disciplinary action to be considered against the 3 DAC officials; and for criminal and civil cases against the external service provider/parties to be instituted.
No
Date Receive
d
(b) Details of each
Investigation/
Allegation
(b) (i) Synopsis of the facts
(Allegation)
(b) (i) Findings of each case
(b)(ii) Persons or Third Parties of
each Investigation
(b)(iii) Cost of
Investigation
( R )
Potential Cost
(Loss) to the
Department
(b)(iv) Appropriate Steps taken
against Officials and third
parties/Outcome
The implicated service provider has been paying bribes to the Department’s official amounting to 10% of each service awarded to the service provider in cash which is delivered to the official in the Department’s parking area.
information.
The system of internal control, especially the preventive and detective controls, within the SCM unit is weak.
Head of SCM misinformed implicated SCM official regarding the requirements to conduct “Remunerative Work Outside of Public Service”.
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