Former Transnet executives blocked from pension withdrawals over R33.5m fraud

The Special Investigating Unit (SIU) and Transnet have been granted an order to block the pension payouts of two former Transnet executives linked to fraud.

The SIU and Transnet said they received an order from the Special Tribunal to interdict the pension payout accusing the executives of being “linked to fruitless and wasteful expenditures of about R33.5 million”.

The order, dated 23 October, states that former executive manager responsible for group business continuity and disaster management, Lerato Mary Theresa Makenete, and former executive manager for safety, Landela Hawkins Madubane, are interdicted from withdrawing their pension benefits from the Transnet Retirement Fund.

According to SIU spokesperson Kaizer Kganyago, the pension funds of the former executives, worth about R8.9 million, will remain interdicted pending the finalisation of an application to be brought against Makenete and Madubane.

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Executives allegedly colluded with three service providers

The state-owned enterprise initiated an investigation into their affairs and asked SIU to support with the investigations.

The probe showed Makenete and Madubane allegedly colluded with three service providers to abuse Transnet’s emergency procurement process during Covid-19 lockdown.

“During the emergency procurement process at the height of the Covid-19 pandemic in April 2020, Transnet contracted with Ramoyadi Air Conditioning, Ndzalo2 Trading, and Eagles Ropes to deliver over a million disposable breathalyser straws,” Kganyago said in a statement.

“Makenete and Madubane allegedly colluded with suppliers to defraud Transnet by inflating the price of the straws from R0.29 per straw to R29.99 per straw, resulting in a total payment of R33 834 698.40.”

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Civil action instituted in the Special Tribunal

The SIU and Transnet said they have instituted civil action in the Special Tribunal to review and set aside the contacts and recover the more than R33,5 million.

“Following the conclusion of the investigation, the SIU made a disciplinary referral to Transnet against Makenete and Madubane. Transnet actioned the referral; however, they both failed to appear for disciplinary hearings, but the proceeding continued in their absence. The duo was found guilty and dismissed,” Kganyago said.