SIU freezes luxury assets over alleged R4m KZN library tender fraud

In a major blow against public sector corruption, the Special Investigating Unit (SIU) has successfully secured a provisional preservation order to freeze a fleet of vehicles and prime real estate linked to an allegedly fraudulent R4-million rural library project.

The Special Tribunal issued the order against Liyabongeka Trading Enterprise CC and its sole director, Ms Thabile Jacqueline Xaba. The sweeping directive strips Xaba and her company of control over three properties and five vehicles, completely interdicting anyone from selling, leasing, transferring, or tampering with the assets to prevent their devaluation.

The unfolding scandal traces back to 28 February 2020, when the KwaZulu-Natal Department of Sports, Arts and Culture signed a Service Level Agreement with Liyabongeka Trading Enterprise. The contract, valued at R3,422,700.38, was meant to bring a vital modular library to the rural community of Ntunjambili, nestled within the Maphumulo Local Municipality.

The project was launched under the department’s infrastructure banner, aimed at bridging the historical gap in educational resources for underserved rural communities. However, SIU investigators discovered that Liyabongeka Trading Enterprise secured the lucrative tender despite failing to score the highest evaluation points or offering the most cost-effective bid.

Construction on the library ground to a screeching halt just weeks after the agreement was signed, triggered by the implementation of the national COVID-19 lockdown.

With the site left abandoned and incomplete, the provincial department unexpectedly approved a further R641,541.14 on July 22 2020, ostensibly to cover extension costs and pandemic-related compliance expenses. This pushed the total public payout to a staggering R4,064,151.52.

However, forensic probers allege that this additional financial injection was anchored in deception. According to the SIU, substantial portions of the extra funding were siphoned off using fraudulent invoices submitted for goods and services that were never actually delivered to the Ntunjambili site.

The SIU’s case is bolstered by damning testimonies and independent forensic evaluations. A subcontracted firm that conducted initial site preparation confirmed to investigators that while they cleared the land, they never performed the contracted fencing or tarring.

Furthermore, an independent technical forensic report exposed a litany of structural deficiencies and contractual deviations. The report revealed blatant non-compliance with the government’s approved engineering blueprints, including dangerously reduced wall thicknesses, severe under-execution of security fencing, substandard civil works, and unjustified contingency claims.

Instead of building a sanctuary of learning for rural children, the SIU maintains that the state’s millions served only to enrich the contractor at the absolute expense of the public fiscus.

As the criminal and civil investigations intensify, the Special Tribunal has ensured that the suspect spoils of the contract remain untouchable.

The frozen property portfolio includes an upmarket residence in Ruimsig, Gauteng, alongside two properties located in Pietermaritzburg, KwaZulu-Natal.

The asset forfeiture list also paints a picture of high-end spending, grounding five vehicles associated with Xaba and her enterprise:

The SIU has reiterated its commitment to systemic investigations, emphasising that it will continue to aggressively claw back state funds and eradicate the systemic fraud and maladministration crippling infrastructure delivery across South Africa.