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A frustrated contractor working for a Northern Cape municipality has blown the lid on an alleged extortion racket, claiming that senior municipal officials withheld payments because he refused to pay a bribe.
This comes after the contractor this week raised the alarm over allegations that top officials at the Renosterberg local municipality, including the mayor, municipal manager and chief financial officer (CFO), wanted KMC Minerals to “take care of comrades”. He claims the company’s invoices were put on hold after it refused to pay the full inducement allegedly demanded, bringing the project to a standstill.
KMC was appointed in February this year to complete a R13-million water treatment contract after a previous service provider allegedly abandoned the project despite having been paid.
According to KMC, payments were initially processed without issue, but things changed in May when the contractor was approached by an individual allegedly acting on the instructions of project unit manager Khabonina Mhlahlo, purportedly to on behalf of the “comrades”.
The “comrades” were allegedly the mayor, the CFO, the municipal manager and an official in the regional office of the department of water & sanitation.
In a letter of demand issued by KMC’s attorneys, seen by the Sunday Times, Mhlahlo is accused of informing KMC owner Karabo Chuene telephonically that “if the invoice is not paid, he will stop the project and ensure that KMC minerals gets no further payments”.
Under pressure, Chuene agreed to meet Mhlalo at his municipal office, where he was allegedly shown a text message from the mayor stating that he wanted the money paid over in terms of the same invoice.
According to the attorneys, Chuene said he did not have the full R400,000 allegedly demanded and could only raise R250,000, which he handed to the site manager, who in turn allegedly passed it on to the project manager.
Hopeful that his invoices would now be processed, Chuene said he was warned that unless he paid the outstanding balance, his company would receive no further payments from the municipality.
However, when KMC later made formal inquiries about the outstanding invoices, it was suddenly informed that issues had arisen regarding the status of the project. According to Chuene, the project’s consultant, Selai Consulting, refused to issue the payment certificate required for the contractor to be paid.
“When we took over the project, absolutely nothing had been done on site, yet the previous contractor was paid. We came in and had various meetings with the consultant appointed by the municipality, and they gave us the go-ahead to start construction work.
“They even approved our progress reports, which gave the municipality the green light to process our invoices for months. All of a sudden, now that we do not want to give into their demands, we are told that things must stop because we don’t have drawings. How, when we have been working on the site with no issue previously?”
Chuene said he later learnt of a meeting convened to discuss terminating his contract. He confronted Mhlahlo, saying: “If you want me out of the project, I don’t mind leaving, but pay me my money and then we go our separate ways.”
Relations between KMC Minerals and the project manager subsequently deteriorated. Chuene said the project manager later sent him a text message stating: “I am not sure why you have this impression that you won’t be paid and that you will be terminated. You are misled and all of this is unnecessary. You are playing a dirty game, I didn’t expect this from you.”
Chuene’s legal team has warned that it will take legal action against the municipality.
Chuene said this week that he had laid charges of extortion with the Hawks in Kimberley.
The municipality, in correspondence to Chuene, said it had stopped payments to KMC after identifying irregularities with the contract.
But Chuene rejected that explanation, insisting payments were withheld because he refused to pay the balance of the money allegedly demanded.
Approached for comment, the municipality on Friday declined to do so, citing the matter as sub judice.
It nevertheless denied the extortion allegations.
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