Two companies hired to maintain the country’s naval fleet are under investigation after multiple allegations of corruption and fraud amounting to more than R100m were levelled at the base in Simon’s Town.
Department of defence documents the Sunday Times has seen show that for almost five years, as part of their “priority crimes” investigations, the military police have been investigating five cases of alleged fraud and corruption of more than R80m involving Grimms Auto Shop, a Cape Town company appointed to supply spares and maintain navy vessels.
The documents also contain allegations that another company tasked with repairing and maintaining the vessels, Durban firm RA Govender, was awarded a fraudulent contract worth about R52m.
Both companies deny the allegations and their owners say they have never been investigated.
The probes began in 2018 after then defence minister Nosiviwe Mapisa-Nqakula demanded investigations into the fleet maintenance tenders. These appear to have stalled with South African National Defence Force (SANDF) insiders blaming the head of the military police, Rear Admiral Mokgadi Maphoto.
A board of inquiry led by Brig-Gen John Moorhouse into the military police is under way, investigating these allegations as well as others of corruption, abuse of authority, defeating the ends of justice and the improper closing of cases.
While his department is under investigation, Maphoto has not been placed on leave.
A highly placed government source with direct knowledge of the inquiry said: “The internal process is to determine how Maphoto has been running the military police... There are investigations that are supposed to be undertaken, but they just disappear.
“If there is a board of inquiry into Maphoto’s department, then why does he continue to be in that department, particularly when it was his juniors that made these allegations against him?”
Military documents contain allegations that Grimms was paid R30m between 2016 and 2018 for allegedly submitting a false testing certificate, which led to the engine of the minesweeper SAS Umzimkhulu being unserviceable.
It is also believed that the company was paid R30m in 2020 for repairs allegedly not done on the warship SAS Amatola; that Grimms received R16m for allegedly submitting a false claim for repairs to the SAS Umzimkhulu; and was paid R395,470 for allegedly supplying the “SA Navy with substandard spares, claiming that the spares were procured in Germany whilst these were procured locally”.
Meanwhile, allegations regarding RA Govender include that the company was irregularly appointed to conduct repairs on navy vessels.
A military police report on the RA Govender investigation reads: “Investigations reveal that the bidding award was tampered with using Tipp-Ex (altering of amounts and forged signatures on the standard bidding documentation) ... This company should have been excluded during the evaluation process.”
Military police sources told the Sunday Times that investigators have been unable to continue their probes, issue warning statements, interview suspects or obtain subpoenas for the bank accounts of those allegedly involved in fraud and corruption at the Simon’s Town base. It has also been alleged that senior officers and their family members are involved.
One senior insider said: “There is interference from the top, that is why the investigations are not moving. Even when the National Prosecuting Authority has given guidance, there is no movement... because those at the top are keeping information to themselves to protect their associates.
“The idea is to let the cases disappear because the companies accused of fraud and corruption are still contracted to SANDF. Also, some of the people in the navy who are accused of being part of this alleged corruption are still at work and in procurement.”
The Sunday Times contacted Maphoto and put the allegations to him. Despite being given a week to respond, he failed to reply even after prompts via e-mail, WhatsApp and calls to his assistant.
SANDF spokesperson Siphiwe Dlamini dismissed the charges that investigations were being stifled.
“All the cases referred to on your inquiry are linked and have been presented to the Commercial Crime Court and the [NPA] for further processing and a decision. Furthermore, there are processes that are followed by investigators in dealing with matters that require investigations and each matter is investigated based on its merit.
“None of the alleged people in these cases have been interviewed yet. It is important to note that there has been no delay on the part of the military police in dealing with these cases.”
The NPA confirmed the military police in Simon’s Town referred four cases to the Bellville Specialised Commercial Crimes Unit and these had been “assigned to prosecutors... and the director of public prosecutions’ office for guidance”.
“Investigations in the cases are ongoing,” said NPA spokesperson Eric Ntabazalila.
However, correspondence from the NPA dated July 2022 advises military police investigators to establish the source of what they had flagged as suspicious cash and electronic payments into the accounts of individuals at the base: those involved in procurement, senior navy officials and their spouses.
Military police insiders said their commanding officers still have not been given authorisation.
It would be impossible to supply any spares that did not meet the SA Navy specifications as the SA Navy has a stringent acceptance process that compares the product against the original specification
— Shafiek Hendricks
Meanwhile, RA Govender owner Stanley Govender said the allegations were nothing new and haven’t been proven.
“These allegations of fraud have surfaced many times and have been the subject of extensive investigations by the authorities. To date, there has been no proof of fraud. The allegations of making gratuitous payments to navy officials have also surfaced many times and is the work of mischief makers who cannot substantiate them with proof. These allegations do not warrant my attention any further as they are frivolous,” he said.
Grimms founder Shafiek Hendricks dismissed the allegations, saying he was being targeted for being a black company.
“My company has never been approached by any military police conducting investigations against us. We did not even know of the report and cases that you mentioned,” he said.
“It would be impossible to supply any spares that did not meet the South African Navy specifications as the navy has a stringent acceptance process that compares the product against the original specification. If a wrong product is supplied, the end user can reject the product and the company would have to bring the correct product. This is a simple process, and it would be strange to initiate investigations into such a process. The company is only paid once the end user confirms that the correct product or service has been delivered.”
Hendricks said Grimms had never been awarded a contract to repair engines on SAS Umzimkhulu but was subcontracted by the original equipment manufacturer, which said the engines could not be fixed as they were obsolete.
“Grimms fixed the engines and brought the ship back to sea. [It] was one of the few serviceable vessels that participated in the armed forces celebrations that were hosted by the South African Navy in 2018. A black company should be celebrated for repairing the ship that even the original manufacturer could not repair. Grimms has completed the work in the navy vessels which the previous contractor could not do,” he said.
Hendricks said the engine of the SAS Amatola was damaged at sea and needed an overhaul, but Grimms was not paid R30m for the work.
“Grimms does not know of any false claims for services that have not been rendered. Payment for any work done by Grimms is authorised by Armscor against the highest scrutiny of each invoice,” he said.
The department of defence’s last annual report said the navy faced challenges “due to significant resource constraints, resulting in a decline in the navy’s ability to prepare and support forces for deployment”.
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