Former eThekwini mayor Zandile Gumede's lawyer has questioned why the City Integrity Investigation Unit (CIIU) did not report fraud and corruption allegations against Gumede and others to the City's disciplinary committee.

Jay Naidoo has been questioning CIIU head Mbuso Ngcobo for three days, and during the questioning, the court hearing details of the processes leading up to the arrest of Gumede and 21 others for fraud, money laundering and corruption.

Since Tuesday afternoon, Naidoo has been zooming in on the evidence of Ngcobo - the first witness to take the stand in the trial.

He questioned why Ngcobo and the CIIU – which initiated an investigation after receiving an anonymous bundle of information relating to the allegations against Gumede – did not report the matter to the City's disciplinary board, which comprises a labour lawyer, accountant and university academic.

On Wednesday, Naidoo said a council resolution created the disciplinary board, and that the board would use the CIIU to coordinate and complete investigations for it.

However, Ngcobo said the disciplinary board would not have oversight in fraud and corruption matters. Rather, it dealt specifically with financial misconduct within the municipality.

"The establishing of the board and regulations [aligned to the board] relates to matters of financial misconduct. There is nowhere you will find a reference to fraud and corruption."

Naidoo then asserted that the disciplinary board would be involved if there was financial misconduct or a contravention of supply chain policies.

He added that the terms of reference for the investigation conducted by forensic firm Integrity Forensic Services (IFS) was to establish whether the supply chain policy had been contravened.

The firm was appointed by CIIU and conducted the majority of the investigation into the fraud, corruption, money laundering and racketeering allegations against Gumede and her co-accused.

Naidoo said that because the terms of reference established by IFS called for checks on supply chain contraventions, the CIIU should have answered to the disciplinary board.

Ngcobo, however, retorted that conducting a full forensic investigation was a process that included scrutinising supply chain processes.

"It (a supply chain investigation] is part of a systematic process of discovering the tools of the investigation.

There is still an aspect of fraud that follows. There were payments to service providers for services not rendered.

"You also cannot complete a full forensic investigation without showing a plan that will lead into that process. Supply chain checks are part of this."

The State is alleging Gumede; former councillor Mondli Mthembu; former city manager Sipho Nzuza; the deputy head of Durban Solid Waste (DSW), Robert Abbu; and the deputy head of supply chain management, Sandile Ngcobo, all worked in concert as the main roleplayers in corruption and racketeering at the municipality.

They were the main individuals who acted as primary persons in an enterprise that conspired to rig DSW contracts valued at more than R320-million to favour their preferred contractors and sub-contractors, the State alleges.