National Union of Metalworkers of South Africa (Numsa) Financial Services Health has launched an investigation into its chairman, Osborn Mahanjana, over alleged unauthorised vehicle insurance benefits for a fleet of his luxury vehicles.
The Financial Services Company of the Metal Workers is a subsidiary of the 3Sixty Global Solutions Group, which is under the NUMSA Investment Company (NIC) – where Mahanjana is contesting the role of chief executive alongside Khandani Msibi, who also serves as non-executive director for the financial services company.
Mahanjana was suspended from his role as CEO of 3Sixty Global Solutions on June 26 following what was described in the suspension letter as “irreconcilable breakdown in the relationship” between him and Msibi.
Earlier this year, Sunday World reported that Msibi had also been placed on precautionary suspension as NIC CEO. In a letter, the company said action was being taken against him over allegations of gross misconduct and failure to perform his duties with the required diligence.
Mahanjana was then appointed acting CEO for NIC. Msibi believes it was betrayal for Mahanjana to accept the acting NIC CEO role while he was still challenging his suspension.
READ: Tussle for Numsa Investment Company top job intensifies
As the relationship between the two further deteriorates, the board resolution dated July 15 authorised an investigation into the vehicle insurance benefit that has been flagged as unauthorised.
Nine cars insured under Numsa-related business
A comprehensive short-term insurance was taken out on nine personal vehicles costing the company R32 949.44 a month, with an additional cover extension including excess cover at R14 393.46 a month, adding to a total of R47 834.34.
The cars included a BMW X7, Porche 911 Carrera T, Porche 911 Carrera 4S Cabriolet, Porche 911 GT3, Land Rover Discovery, Audi A8, Ferrari 599 GTB Fiorano, Mazda CX-5, and a Nissan NP200.
“No record of board authorisation, contractual entitlement, or precedent for this benefit has been identified to date.
“Dr Mahanjana, as the subject of this matter and a person with a direct personal financial interest in its outcome, is conflicted in terms of section 75 of the Companies Act. He is listed below as a director of the company but is recorded as not voting on this resolution,” reads the resolution.
Mahanjana called to account
In a letter drafted by Msibi dated July 2, seen by Sunday World, Mahanjana was asked to explain within five business days, whether the insurance benefit had been approved by the board, formed part of any contractual entitlement or was supported by any company policy or precedent.
The letter further argues that directing or allowing staff under his supervision to provide him with such a substantial personal benefit without disclosure or board approval appeared to amount to an abuse of his position.
READ: Numsa Investment Company suspends CEO
“Please note that this unauthorised benefit has been stopped with immediate effect. The company will now consolidate its records and reports in respect of all premiums paid on your behalf under these policies, and you should expect to receive a formal letter of demand for repayment in due course,” reads the letter in part.
According to the resolution, should Mahanjana fail to provide a satisfactory explanation, the resolution authorises Msibi to demand repayment of all company funds spent on the insurance.
It also empowers him to report the matter to the Directorate for Priority Crime Investigation under the Prevention and Combating of Corrupt Activities Act, lodge a complaint with the Health Professions Council of South Africa and pursue any further legal or regulatory action considered necessary to protect the company’s interests.
Criminal charges filed against Mahanjana
Following the findings, Msibi opened criminal charges against Mahanjana, accusing him of fraud.
Police spokesperson Dimakatso Nevhuhulwi confirmed that a fraud case was opened at Norwood police station and investigations are underway. No suspect has been arrested.
Mahanjana did not wish to respond in details tp questions sent to him by Sunday World, saying they would form part of an ongoing forensic investigation.
He simply said: “For background purposes, you know that Mr Khandani Msibi has been suspended at NIC and is no longer employed at DGH.”
- National Union of Metalworkers of South Africa (Numsa) Financial Services Health has launched an investigation into its chairman, Osborn Mahanjana, over alleged unauthorised vehicle insurance benefits for a fleet of his luxury vehicles.
- The Financial Services Company of the Metal Workers is a subsidiary of the 3Sixty Global Solutions Group, which is under the NUMSA Investment Company (NIC) – where Mahanjana is contesting the role of chief executive alongside Khandani Msibi, who also serves as non-executive director for the financial services company.
- Mahanjana was suspended from his role as CEO of 3Sixty Global Solutions on June 26 following what was described in the suspension letter as “irreconcilable breakdown in the relationship” between him and Msibi.
- Earlier this year, Sunday World reported that Msibi had also been placed on precautionary suspension as NIC CEO.
- In a letter, the company said action was being taken against him over allegations of gross misconduct and failure to perform his duties with the required diligence.
