Supplier inflated prices by almost 100% for Covid-19 PPE contract with Gauteng health dept - SIU

26th January 2022 By: News24Wire

During an 18-month investigation, the Special Investigating Unit (SIU) uncovered alleged fraud in a number of cases while investigating 211 Covid-19 procurement contracts in Gauteng. Only four of those cases have yet to be finalised.

The SIU launched a probe in Gauteng after the provincial audit services informed the Office of the Premier of alleged irregular and unlawful conduct by health department officials during the procurement of personal protective equipment (PPE) for Covid-19.

The SIU found that in one of the agreements, Mlangeni Brothers Events CC was awarded a R24-million contract for the provision of 100 000 boxes of powdered and non-powdered gloves.

The SIU's investigation revealed that former chief financial officer of the Gauteng Department of Health, Kabelo Lehloenya, and former Gauteng health chief director for supply chain and asset management, Thandiwe Pino, had not followed proper procurement procedures in awarding the contract to Mlangeni.

Overcharging

The SIU investigation found that Mlangeni overstated its prices by more than R12-million for the supply of the relevant PPE.

The SIU said criminal charges were opened against Mlangeni and the former head of department Mkhululi Lukhele.

Pino was dismissed after a disciplinary process, while no recommendation for disciplinary action could be made against Lehloenya and Lukhele because they had resigned.

The SIU also closed investigations into 100 awarded contracts totalling R1 531 892 902 after the probes found no evidence that the supply chain management processes had been irregular, and no adverse findings could be made.

On Tuesday, President Cyril Ramaphosa's office announced he had authorised that the final report on the SIU probe into more than 5 400 government contracts linked to Covid-19 goods and service be made available to the public.

The unit investigated 5 467 contracts countrywide, valued at R14.3-billion, awarded to 3 066 service providers.

Investigations linked to 4 549 contracts have been finalised, with 2 803 of those agreements found to have been irregular. This amounted to 62% of the finalised investigations being deemed irregular.

The Presidency said 45 matters, constituting a combined value of R2.1-billion, have been enrolled with the Special Tribunal on Corruption, Fraud and Illicit Money Flows.