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How lawyers scammed the SABC
| Rudolph Muller | July 23, 2007 | No comments |
Rudolph Muller
Rudolph Muller is the editor at MyBroadband and covers telecoms and broadband news. Rudolph comes from an academic background, but left the University of...
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SABC boss Dali Mpofu is back in the spotlight after a man he hired now stands accused of defrauding the broadcaster of at least R1.8-million.
Mpofu has yet to suspend SABC legal head Mafika Sihlali who, an internal audit found, spent millions in various dodgy deals. The SABC group chief executive was advised to suspend Sihlali in April pending a probe into his irregular spending. Mpofu has business links with Sihlali in at least nine companies whose interests range from mining to investments and financial services.
The internal investigation followed two anonymous letters sent to the SABC board members earlier this year detailing alleged corruption and mismanagement by senior managers — including Mpofu.
Board chairman Eddie Funde declined to say whether managers other than Sihlali were under investigation.
He said: “We really can’t talk about the investigations that we are conducting until they are completed … this an internal process that we are busy looking at.”
A report compiled by the broadcaster’s group internal audit unit reveals how Sihlali:
- Authorised millions in lawyers’ fees to his own law firm and two others with which he has links. Oilgate lawyer Barry Aaron’s firm was paid double for at least three jobs;
- Failed to declare his business interests in 28 companies when joining the SABC on August 1 2006;
- Failed to declare his relationship with Aaron, to whom he gave work . This after Aaron represented him in several personal matters prior to him joining the SABC;
- Verbally harassed at least two senior female staffers and, in one instance, threatened to break a woman’s legs; and
- Used an SABC Mercedes- Benz since December at a cost of R129000 — despite receiving a car allowance and not being allowed to use pool cars.
The damning report could place Mpofu’s job on the line after a series of controversies since his appointment in 2005.
On Friday, Mpofu refused to discuss the nature of his relationship with Sihlali, but admitted the legal services head was still at work.
“I cannot possibly comment on any ongoing investigation against any personnel at the SABC,” he said.
The audit report shows Aaron allegedly benefit ed from a “conflict of interest” and earned R1.9-million from the SABC thanks to his links with Sihlali.
It names two other law firms that received work once Sihlali took office — one his own — and highlights “various suspicious payments” made to the firms, recommending they and their principals face criminal charges.
Aaron represents Sandi Majali, controversial oil dealer and ANC funder.
The report reveals how Aaron’s firm was paid twice for several jobs amounting to at least R130000. When questioned by investigators on June 8, Aaron confirmed the “duplicate payments”. He said he did not return the money, but instead put it in a “general account” from which fees for outstanding jobs were deducted. He pledged to assist investigators by making certain documents available to them.
In Sihlali’s first three months in charge of legal services, Aaron received a total of R710425, with invoices submitted containing “little detail”, especially with regard to hours.
The report says another law firm “received a huge volume of work totalling R6141150.75 which translates to an average of R767630 per month”. The work was mainly performed by a woman previously employed by Sihlali Molefe Inc, who, the report says, cost the SABC R2.7- million for work done between August 2006 and April 2007.
Expenses for Sihlali’s department were exceeded by almost R15-million by March 31 — exactly double its budget.
Yesterday Aaron told Sunday Times: “Numerous issues appear to have been omitted from the report when the forensic team … acknowledged considerable positive aspects in our work, including the extent of work in settling and commenting on contracts and positive results in litigation matters.”
He said at least R1-million in fees had been paid to advocates. “We would like it to be taken into consideration that the nature of certain of the allegations in the report involving us may be phrased in a particular way to create atmosphere.”
