The ghosts in the municipality’s machines are not just white noise, resulting in two dismissals at the institution so far, while more corruption is being uncovered by the day, with the latest being more than 2 000 fraudulent transactions discovered at both the Hendrina and Middelburg licensing departments.
The latest discovery might not have incurred the municipality any financial losses, but a barrage of other irregular payments, including the payment of undue acting allowances and overtime pay, as well as accidental payments of over R3 million to municipal service providers, of which more than R600 000 cannot be recovered, resulting in a slew of criminal complaints.
The Municipal Public Accounts Committee (MPAC) released three reports during a recent council sitting, all addressing wasteful, irregular and unauthorised expenditure, with some spanning more than two years of irregular overtime and acting allowance payments.
In December last year, during the execution of the normal service provider’s payment process, a cash creditor batch was verified and authorised on the municipal pay system.
The batch was imported by the municipal IT department to a folder located in the old financial system drive, from where the batch was imported into FNB.
The batch was checked several times and ultimately approved.
A day after the import to FNB, a contractor made enquiries regarding the amount paid to him, which was less than owed.
It was then discovered that three accounts of three suppliers had been altered.
The financial loss suffered by the municipality amounted to just over R3 million, of which R627 000 could not be recovered, with just short of R2.4 million refunded to the municipality by FNB.
From observation of the payments, the fraudulent account amendments were effected after the EFT batch was generated from the municipal payments system but before the batch was imported to FNB.
The tampering occurred while the batch was stored on the old payment system, no longer in use.
Meanwhile, disciplinary hearings are continuing against six employees who received millions in undue acting allowances and overtime pay after two have already been dismissed following disciplinary hearings, a second MPAC report notes.
More than R2.6 million was paid to the recipients over 24 months.
In a third report, MPAC highlighted the accidental payment by a municipal clerk to a former employee of the municipality.
The employee has explained and apologised for the oversight, while a request for a refund has been issued to the recipient.
