Six more arrested in R37m Mhlathuze Water Board fraud, corruption case

The Hawks in KwaZulu-Natal have arrested six more suspects in connection with a R37 million fraud and corruption case at the troubled Mhlathuze Water Board.

Mhlathuze Water Board

The suspects, who cannot be named until they appear in court, were arrested in an early morning operation on Friday by the Hawks’ Serious Commercial Crime Investigation unit.

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The charges against the suspects include fraud, money laundering, corruption, contravention of the Public Finance Management Act and defeating the ends of justice. The charges stem from an ongoing investigation into a R37 million tender that was unlawfully awarded to a law firm by the Mhlathuze Water Board.

The latest arrests bring the number of suspects in the case to 14.

Court appearance

According to Hawks spokesperson Colonel Katlego Mogale, the suspects – aged between 32 and 68 years – include three water board members, the head of the legal department, an architect, and the sole director of NCD investments.

They will all appear in the Durban Magistrate’s Court on Friday.

“This is as result of an intensive investigation into allegations of irregular appointment of service providers (Legal panel) without following the supply chain management protocols of the Mhlathuze Water Board, as well as contravention of section 51(1) of the Public Finance Management Act, Act 1 of 1999 by not complying with the operational policies of the public entity. Investigations are continuing,” Mogale said in a statement.

Mhlathuze Water Board to be dissolved

The Mhlathuze Water Board, which has been plagued by corruption and mismanagement, will be dissolved at the end of this month.

The announcement was made by Water and Sanitation Minister Senzo Mchunu in a government notice published on 19 June.

All the entity’s staff and assets will be moved to a new water board called Umngeni-uThukela water board. The new board is named after the province’s two biggest rivers, Umgeni and Tugela.

The decision to dissolve the Mhlathuze Water Board follows years of government plans to eventually have single water boards in every province. The new Umngeni-uThukela water board will cover most of KwaZulu-Natal.

Mchunu wrote in a letter dated 13 June 2023: “By virtue of the powers vested in me in terms of Section (28)(c)(d) of the Water Services Act, 1997 (Act No.108 of 1997), Senzo Mchunu, in my capacity as the Minister of Water and Sanitation, hereby give notice to:

A) Disestablish Mhlathuze Water, effective from 30 June 2023.

B) Transfer of staff, assets and liabilities of the former Mhlathuze Water to uMngeni-uThukela, effective 1 July 2023.”

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