Acsa executive implicated in multi-million rand ‘fraudulent’ tender

2020-02-27 14:43

Senior Airports Company SA (Acsa) executives have been implicated in a “fraudulent tender” that was allegedly inflated by almost R10 million after the bid was awarded and the contract signed with a different company that never submitted a bid.

This was contained in a forensic report by the airports management company.

The George Fivaz Forensic and Risk (GFFR) report, dated August 29 2019, found that the contract for the management of luggage trolleys at OR Tambo International Airport had been awarded to a company named Plan B Consulting CC. The company submitted a bid just below R9 million, but Acsa fraudulently signed the service contract with a different company, Plan B Trolley Engineering and Operations, of R18 million.

The report also found that certain Acsa employees, including the assistant general manager of OR Tambo International Airport, Kris Reddy, “colluded with the external parties to fraudulently divert the award to the parties who never submitted a bid”.

The word ‘forensic’ does not automatically mean that a report’s contents should be treated as fact that would be accepted by a court of law.

The general manager at the airport, Bongiwe Pityi, was also found to have acted “negligently and/or recklessly” in the execution of her duties and responsibilities “by signing fraudulent documents without applying her mind in ensuring that the documents are legitimate”.

Acsa told City Press that a criminal case was opened against individuals implicated in the contract but declined to confirm their names.

The company cautioned that details in the forensic report should not be taken as fact.

“The word ‘forensic’ does not automatically mean that a report’s contents should be treated as fact that would be accepted by a court of law,” said spokesperson Refentse Shinners.

Shinners said the information “may yet be found by a court of law to be unreliable”, adding that people named in the criminal charges ought to be afforded due process. She said Acsa was “committed to the highest standards of corporate governance and would not tolerate unethical or corrupt behaviour”.

The forensic report recommended criminal charges against three Acsa officials – Reddy, Shumani Netshivhodza (commodity specialist) and Makgabo Madiba (senior supervisor baggage and operations) as well as the owner of Plan B Trolley Engineering and Operation, Tshepo Madiba.

Disciplinary action was also recommended for Makgabo Madiba, Netshivhodza, Reddy and Pityi.

Acting supply chain manager Mpho Maphanga was cleared and written warnings were recommended for Paballo Pheme and Hlodi Ramaru.

Absalom Njoni, the manager of baggage and trolley operations, was also implicated but he was shot dead last May.

Shinners said “the recommendations for disciplinary action have largely been implemented. The company is in the process of finalising the disciplinary processes”.

"However, it should be noted that, at the time of the final report, Shumani Netshivhodza was no longer an employee of Acsa. The company could not pursue disciplinary action against him. The recommendations of the report cannot be implemented simply as they are recorded there. A disciplinary process has to be followed in compliance with [the labour laws].”

She said police were investigating Njoni’s murder.

He was allegedly gunned down at his house in Tembisa, east of Johannesburg. The killing was allegedly related to his work at Acsa.

Tshepo Madiba said he was never questioned by the GFFR despite its findings that he was among the central figures in the alleged fraud. He said he had evidence to show that he did nothing wrong, including that he had a valid business relationship with Plan B Consulting CC. He served as the company’s representative at Acsa on all tender matters.

He said he prepared all the tender documents for Plan B Consulting CC, personally made the submission and handled all communication between Acsa and the company. This received added value from his qualification and accreditation as an engineer.

Madiba said that in return, Plan B Consulting CC would gain financially from his work. However, a representative from Plan B Consulting CC told the investigators that Madiba was actually an employee of the company.

Madiba said he had the power to authorise the cession agreement of the contract from Plan B Consulting CC to his own company, Plan B Engineering and Operation, based on the said business relations. He said Acsa had enough time not to sign the contract with his company if it was of the view that he did not have the authority to act on behalf of Plan B Consulting CC.

Asked how the value of the tender increased from R9 million to R18 million, Madiba said the decision was taken by Acsa and all bidders were notified to adjust their pricing. He said that the pricing of the tender at R9 million over three years would have meant that the service would be provided at R250 000 a month, which would have not even covered the salaries of the people employed to do the work.

The GFFR forensic report said that the trolley contract was advertised on September 12 2017 and the bid closed a month later. Five companies – Plan B Consulting CC, GP Outsourcing (Pty) Ltd, Henry Williams Logistics, Kgoebane Engineering Construction and Funduthando Trading CC – had submitted tenders.

A memorandum on November 2 2017, which was only signed 20 days later, recommended Plan B Consulting CC as the winning bidder, and the tender amount recorded as R18 234 314.50.

A series of email were allegedly exchanged between Netshivhodza and Makgabo Madiba – whom he referred to as “Dear Bidder” – in which “new costing” was discussed and “an amended price schedule” and a “new quotation” shared. The responses to Netshivhodza allegedly came from Tshepo Madiba, including the new quotation of R18 234 314.50.

“It is prudent to note that the amount of R18 234 314.50 had already been recommended by the bid evaluation committee in their memorandum drafter on November 2 2017 but only signed on November 22 2017,” said the GFFR.

Three weeks later the tender board, which received a recommendation from the Bid Evaluation Committee, approved the award to Plan B Consulting CC.

The investigators heard that “certain Acsa employees decided, in conjunction with Tshepo Tala Madiba to inflate the tender price of Plan B Consulting, from just below R9 million to more than R18 million”.

The “conspirators” later changed the contract from Plan B Consulting CC to the name of Plan B Trolley Engineering and Operations.

Communication that Plan B Consulting CC got the award was allegedly “directed to Tshepo Tala Madiba” in Cape Town, instead of the Johannesburg registered address of Plan B Consulting CC.

“Investigations revealed that the Cape Town address is the registered address of Plan B Trolley Engineering and Operation CC, the close corporation to which the contract was later fraudulently ceded.” The GFFR alleged that this was done to withhold information from Plan B Consulting CC.

The forensic company alleged that by February 16 2018, Tshepo Madiba “submitted a fraudulent cession agreement between Plan B Consulting CC and Plan B Trolley Engineering and Operations,” which Reddy signed “without confirming that Tshepo Tala Madiba was authorised to sign as representative of Plan B Consulting. A service level agreement was signed three days later”.

The GFFR said that at the time of the submission of bid documents Tshepo Madiba was working for Plan B Consulting CC as a technical adviser.

“His service was terminated later, upon discovering that he had fraudulently diverted payments of up to R3 million in a sperate contract between Plan B Consulting CC and Acsa Cape Town.

In June 2018 a representative of Plan B Consulting CC visited the OR Tambo International Airport and “noticed people wearing uniforms bearing the name of Plan B Trolley Engineering and Operations working with trolleys”, despite the fact that the company did not participate in the bid.

A representative of Plan B Consulting CC told City Press that she was aware of the Acsa investigation.

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March 29 2020