Former municipal manager Henny Smit has been released on R150 000 bail following his arrest for fraud and corruption.
The 70-year-old suspect, who worked for the Mahikeng local municipality in the North West, appeared in the Molopo magistrate’s court on Tuesday.
He is due back in court on December 8 while police hunt for other suspects.
Smit is charged with fraud, theft, contravention of Municipal Finance Management Act, and four counts for breaching the Prevention and Combating of Corruption Activities Act.
He also faces charges of money-laundering and contravention of the Public Finance Management Act for losses incurred by the human settlements department.
Henny Smit is linked with the unlawful sale of municipal land to the value of R144-million without council approval and not following competitive bidding process, according to the National Prosecuting Authority (NPA).
It is alleged that in October 2007, he illegally agreed with a certain company for the sale of land belonging to the municipality. The said company paid a R5-million deposit.
“Investigations reveal that the company went into liquidation in December 2011 without paying the municipality the outstanding debt,” said NPA spokesperson Henry Mamothame.
“The assets of this company were subsequently sold to another company at an auction for an amount of R16-million.”
In April 2012, the new land owners allegedly changed the name of the company, and between 2013 and 2015 they sold and transferred portions of the land to five other companies and a trust account.
The Hawks said the directors and shareholders of these companies had links to the company that was liquidated.
Speaking on behalf of the Hawks, Lieutenant-Colonel Tinyiko Mathebula said the company that bought the land at an auction entered into an unlawful agreement with the Social Housing Regulatory Authority to build 2 400 units at the value of over R301-million.
An amount of R54-million was allegedly authorised by the North West department of human settlements for the start of the project.
“Investigations also revealed that an amount of over R550 000 was paid as gratification to one suspect and it was further traced to a purchase of a house to the accused daughter,” Mathebula said.
“More arrests are expected to be effected in this case.”
Henny Smit’s bail conditions state that he must not interfere with state witnesses. He is also required to inform the investigating officer should he wish to travel outside of Gauteng.
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