An Eastern Cape municipal project manager, four contractors and two companies will appear in the Butterworth Magistrate's Court on Friday for alleged fraud, theft, corruption and money laundering.

According to Hawks spokesperson Lwando Zenzile, the Hawks' Serious Corruption Investigation teams arrested three of the five suspects, aged between 38 and 69, in an early morning blitz on Friday.

The other two suspects are currently in quarantine in Gauteng and Cape Town respectively. It is expected that they will send their legal teams to court to represent them.

"The Mnquma Local Municipality issued an advert inviting bidders for the preparation of preliminary designs of Ngqamakwe town internal street surfacing in August 2013," Zenzile said.

Two companies were appointed as the consulting engineers for the designs and project implementation, Zenzile said.

A further two companies were subsequently appointed for the construction of the street surfacing in August 2013 as well.

"It was found that the workmanship was substandard and poor," Zenzile alleged.

Zenzile said municipal officials signed payment certificates to four companies, all of whom had formed joint ventures for services that were not rendered.

"The Hawks were roped in to investigate and found that more [than] R9.1-million, the available project budget, was lost by the municipality.

"The investigation further revealed that there was also an over expenditure of R982 000 which was charged against the municipality," Zenzile said.

He added that the project manager allegedly signed off all the invoices and the service providers allegedly pocketed millions for work not done.