The Special Investigating Unit (SIU) has launched a court bid to cancel a R111-million lease contract the National Students Financial Aid Scheme (NSFAS) has awarded to Dynamic SA Holding to accommodate its employees in Cape Town.
The SIU has also accused NSFAS former chief executive officer, Andile Nongongo, of manipulating the awarding of the lucrative tender in favour of Dynamic SA Holding.
This emerged in the papers the unit submitted to the Special Tribunal in Johannesburg, where it seeks to review, set aside and claw back, from the respondents, the money already paid to the entity.
The SIU names the six respondents as NSFAS, Dynamic SA Holdings, Ziningi Properties, the directors of both companies, namely Bheki Dlamini and Robert Edward Alexander, and Nongongo.
Ziningi was the true owner of the building leased to NSFAS hence when the scheme paid rent, most of it passed on to Ziningi.
In the main SIU affidavit, forensic investigator Mark Phillips said the unit will contend that NSFAS misled potential bidders by misstating that the tender was for two years, renewable for a further three, when in fact it knew that it intended it to be for five years. The advertised two-year tender was for more than R111-million.
“NSFAS disqualified six bidders for failing to meet a certain requirement, and yet it awarded the tender to a bidder who did not meet the very same mandatory tender requirements,” he wrote.
But he reserved the most scathing rebuke for the former CEO, accusing him of appointing Krishen George as supply chain management (SCM) adviser, thereby setting up his own parallel adjudicating panel outside the prescribed process.
“This is tantamount to establishing his own committee to have an indirect influence on the outcome of the tender process… with an improper interest meant to subvert and undermine the legitimate SCM processes to achieve a predetermined outcome.
“A reasonable inference can be drawn that George’s conduct and that of the CEO undermined the integrity and independence of the SCM process, and thus the outcome could not be ascribed to a procedurally fair and lawful SCM process.”
Phillips stated that Nongogo and George’s “apparent meddling” was “designed to prejudice Ambition Services Incorporated (another bidder) to the advantage of Dynamic”.
This high-stakes legal battle could result in the SIU holding Nongogo personally accountable for what it alleges was an “unconstitutional, unlawful, irrational, unreasonable and procedurally unfair” deal.
The SIU is asking the tribunal to declare that the directors of both companies should be held personally liable for all amounts due and award costs against the respondents because “the companies and their directors cannot claim to be innocent parties, as they knew very well that the conclusion of the five-year lease agreement was not what Dynamic had bid for”.
This case represents the latest development in the ongoing clean-up operation at NSFAS.
The outcome could have significant financial implications for both the involved companies and the former officials, as they may be required to pay liabilities personally. Sunday World reported earlier this month that the SIU had won a landmark ruling that allowed it to claim the more than R11-million in illegal bonuses paid to former SABC chief operating officer Hlaudi Motsoeneng from the broadcaster’s executives who approved the payment.
The respondents were given 15 days to indicate whether they intend to oppose the application, and the matter is expected to be scheduled for a hearing soon.
