Two key accused in the looting of millions of rand meant to help provide water to KwaZulu-Natal residents allegedly built themselves mansions with their spoils.
Mhlathuze Water CEO Mthokozisi Duze and attorney Sithembelo Mhlanga are implicated in R37m tender fraud and intimidation of witnesses.
Hawks investigating officer Col Ngoako Mphaki said in a supplementary affidavit in court that Duze began building a sprawling house worth R20m in the exclusive Mtunzini Estate, paid for in cash. Construction on the house started last year and is halted at the moment.
The 175ha estate is widely regarded as one for SA’s elite. It has private access to a jetty along the uMlalazi River where residents keep their catamarans and ski boats.
Mphaki said Mhlanga built a house in Ballito worth almost R17m, allegedly using some of the money his law firm, Mhlanga Inc, received from Mhlathuze Water through the allegedly unlawful contract.
The house, in a sought-after suburb, features wood and glass architecture and has large wooden doors leading into a marbled floored double-storey home.
It has two wings, an open-plan lounge, dining room and kitchen, as well as an expansive entertainment area featuring a pool, and an outdoor lifestyle and play area.
“There is no bond registered over the property,” Mphaki said.
Duze and Mhlanga are facing charges of intimidation and defeating the ends of justice for attempting to stop a probe into how Mhlanga’s law firm was appointed to a legal panel and scored R37m from the water authority in 2018.
Also charged are Nonhlanhla Mkhize, the director-general in the KwaZulu-Natal premier’s office, and Siphiwe Mabaso, who is said to be a former defence force member and now a “debt collector” who allegedly posed as a National Intelligence Agency (NIA) agent.
Duze, Mhlanga, Mhlathuze Water CFO Babongile Mnyandu and another attorney, Thabiso Khumalo, who works for Mhlanga Inc and processed some of the invoices, are also facing charges of fraud and corruption in that “they colluded to ensure Mhlanga Inc was appointed to panel”.
Mphaki said in the affidavit he had tasked a forensic expert to trace the contractor, architect and others involved in the building of Duze’s mansion to “obtain the relevant source documents that could be used to trace the flow of proceeds of crime”.
He said the forensic expert had met the contractors and cautioned them that Duze was a suspect in an ongoing investigation and they were not to discuss the matter with anyone.
However, telephone records show that on the same day, Duze communicated with his contractors — one of them more than 10 times — who are all potential witnesses.
Afterwards, they were all “reluctant to provide the required information”. The builder, he said, had finally co-operated three months later after being subpoenaed.
“During an interview he [the builder] said he was advised by Duze not to participate in the investigation,” Mphaki said.
“It is evident that during the criminal investigation … Duze was influencing witnesses.”
In argument during the bail application, Duze’s lawyers disputed the value of the house and said there was nothing untoward about him talking to his builders.
Siyabonga Bhengu of Thazo Projects, the architectural company employed to design Duze’s property, was reluctant to talk to the Sunday Times.
“I have already provided a statement to investigators and I don’t want to put the case at risk by divulging information related to that property,” he said.
A resident who preferred to remain anonymous said while Duze’s double-storey property was large, boasting several rooms, a double garage and pool, it would be hard to value it at R20m.
“Maybe the R20m figure is related to the property and all the interior and exterior finishings. All construction has been halted on the premises.”
Police have confirmed that a construction worker slipped and fell to his death from the second floor of the building in January.
Duze is the only accused who has been denied bail.
Durban specialised commercial crime court magistrate Garth Davis said his conduct had shown him to be a “belligerent person who is willing to bully individuals” — and that witnesses were deserving of protection.
Duze’s attorney, Phila Magwaza, said his client was in Westville prison and he had limited contact with him.
Magwaza said he was working on an appeal application against the refusal of bail.
Mphaki said in his affidavit that an analysis of Mhlanga’s bank accounts showed he had received just more than R21m into his trust account from the water authority between May and October 2020.
Mhlanga then made direct payments amounting to more than R16m to NCD Investments — an entity owned by his wife — which was used to build the Ballito house.
Mphaki claimed no legal services had been rendered to NCD and this was “indicative that Mhlanga used his trust account for personal expenses”.
He claimed Mhlanga also made the “corrupt payments” to Duze and Mnyandu from his trust account.
Approached for comment, Mhlanga’s attorney, Sihle Hongwane, said: “For about 10 years the firm has not received nor kept any client’s trust funds. Monies received into the account are monies already worked for and earned as fees. We see no crime.”
He said Mphaki’s allegations still had to be tested in court.
The main charge relates to allegations that Mkhize, Duze and Mhlanga conspired with Mabaso who, posing as an NIA agent, threatened the water authority’s chair, Thabi Shange, forcing her to give him a recently completed forensic audit report which implicated Duze and Mhlanga in wrongdoing.
The accused in the intimidation case have denied the allegations.
They will appear in court again in early December.
— Additional reporting by Orrin Singh
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