Multi-million rand restraining order on Amathole officials declared permanent

In a new legal development, the Makhanda High Court has officially confirmed a restraining order worth R165 million against several high-ranking officials of the Amathole District Municipality, as well as directors of implicated businesses.

In context, the restraining order refers to a legal measure taken by the court to freeze or restrict the assets of individuals and businesses involved in fraudulent and corrupt activities, with the purpose of the restraining order being to prevent the accused parties from dissipating or hiding the proceeds of their unlawful activities.

Fraud, corruption and money laundering

According to an official police statement, the accused individuals, who face charges ranging from fraud and corruption to money laundering, have been released on bail pending trial.

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The statement explained that the case revolved around a colossal project known as the Accelerated Sanitation Programme, initiated by the Amathole District Municipality in 2013. The ambitious undertaking aimed to erect 66 700 ventilated improved pit (VIP) toilets in various villages within the municipality. The allocated budget for the project amounted to an impressive R631 million, with the Siyenza Group entrusted to execute the endeavour.

However, according to police spokesperson Captain Yolisa Mgolodela, the project hit a major snag when the National Treasury lodged a complaint alleging that the Siyenza Group had submitted two falsified tax certificates during the tendering process.

Investigations

“Consequently, investigations were launched, leading to the shocking discovery that over R149 million had been redirected to multiple beneficiaries’ accounts, in addition to the purchase of a luxurious R16 million house by the director of Siyenza Group, utilizing funds meant for the sanitation project,” she said.

Following the arrest of the accused in November last year, Mogolodela confirmed that both the ill-gotten funds and the extravagant property were seized.

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In December 2019, a provisional restraint order was issued, effectively freezing the assets. This provisional order has now been confirmed as permanent, securing the government’s hold on the confiscated wealth, as well as reinforcing the severity of the charges against the accused.

The Makhanda High Court has scheduled the case to reconvene on 20 September this year.  Meanwhile, several of the accused have submitted representations to the National Director of Public Prosecution, aiming to defend their actions.