Hawks probe alleged fraud of R36 million at Eastern Cape municipality

The Independent Police Investigative Directorate (Hawks) are probing a case of alleged fraud of R36 million (US$2.1 million) at an Eastern Cape municipality.

In a statement released on Friday, Hawks spokesperson Lieutenant- Colonel Philani Nkwalase said the Hawks’ Serious Corruption Investigation team conducted a search-and-seizure operation in Mount Ayliff in the Alfred Nzo municipality after allegations arose of fraud and corruption.

He said the allegations were that senior municipal officials colluded with service providers and fashioned a criminal network that acted in a coordinated manner.

“The criminal network allegedly operating outside and within the municipality created a duplicate tender contract that was already in place and procurement processes were disregarded.

“This tender, worth R36 million, was awarded to another service provider reportedly linked to the syndicate,” Nkwalase said.

He said a subcontracted company allegedly transferred funds to the municipal officials in order to disguise the source and movement of funds.

Nkwalase said the municipality suffered a loss because of undue payments over a period from 2014 and 2018 for the duplicate service of revenue and billing management solution.

He said the purpose of the search-and-seizure operation was to secure documents linked to the allegations of fraud and corruption in the interest of justice.

No arrests were made during the operation at the municipal offices, pending the finalization of the investigation.

The Hawks are a specialised unit which targets organized crime, economic crime, corruption, and other serious crimes referred to them by the president or the South African Police Service.

The elite crime-fighting unit was established in 2008 by former president Jacob Zuma.

-African News Agency (ANA)

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