‘Amigos case’ comes back to haunt ANC at Zondo commission

‘Amigos case’ comes back to haunt ANC at Zondo commission

Deputy Chief Justice Raymond 'Ray' Zondo greets the commission before hearing testimony from Trevor Manuel and Siphiwe Nyanda, 28 February 2019. Picture: Karen Sandison / African News Agency (ANA)

The case involved political heavyweights Mike Mabuyakhulu and Peggy Nkonyeni, but the charges were withdrawn.

Ahead of the lunch break adjournment on Tuesday, the commission of inquiry into state capture chaired by Deputy Chief Justice Raymond Zondo started hearing testimony on the so-called ‘Amigos case’ implicating KwaZulu-Natal African National Congress (ANC) politicians.

The case relates to tenders for the supply of water purification and oxygen plants to KwaZulu-Natal’s health and local government departments.

The case, which has dragged on for years, involved political heavyweights Mike Mabuyakhulu and Peggy Nkonyeni as well as the former KwaZulu-Natal Treasury boss and Ithala CEO Sipho Shabalala and his wife, Beatrice, accused of racketeering, corruption and fraud.

On Monday, Zondo dismissed an application by the Shabalalas to delay PricewaterhouseCoopers (PwC) forensic auditor Trevor White’s testimony relating to the case.

READ MORE: Zondo dismisses application to delay testimony relating to the ‘Amigos case’

Mabuyakhulu served as the MEC for co-operative governance and traditional affairs (Cogta) in KwaZulu-Natal and Nkonyeni served as the MEC for health in the province at the time of the alleged irregularities around the procurement of the plants.

White told Zondo that the water purification and oxygen plants were supplied to the departments by Intaka, a Cape Town-based entity owned by Dr Gaston Savoi.

The matter was dubbed the ‘Amigos case’ because Savoi allegedly referred to people as amigos, White said.

In 2009, the department of health in KwaZulu-Natal appointed PwC to investigate contracts within the department, Zondo heard.

White said that although National Treasury was part of the investigation, PwC took instructions from the police.

He said the accountant-general at the time advised investigators to approach the matter “from the bottom up” because had they started their probe from “the top” and because politicians were involved they would not make headway in the case.

“And that’s effectively how the investigation was done,” White said.

White also told Zondo that his testimony would be on the R1 million payment made by Intaka, which Savoi described as a donation to the ANC, which was made via a lawyer’s trust account and how this money was tracked to how it was spent on Shabalala’s personal expenses. Some of it was allegedly paid in cash to Mabuyakhulu.

He said he would testify on two payments of R500,000 made to Rowmoor, an entity whose sole director was Nkonyeni’s boyfriend at the time, Linda Mkhwanazi.

“There were procurement irregularities, the procurement processes were manipulated to the benefit of Intaka,” White said.

He added that Shabalala had been the link between Intaka and the government departments in KwaZulu-Natal and that he was one of the first people who met Savoi.

Shabalala was taken on a trip to South America, paid for by Intaka, for him to see the services and products the company could provide to the departments.

Shabalala subsequently wrote a memorandum dated 9 May 2005 to the MEC for health at the time, Dr Zweli Mkhize, recommending that Intaka be used to provide the plants and that R22 million should be allocated from the poverty alleviation fund to procure these.

The commission also heard that Beatrice Shabalala entered into a separate business venture in which Savoi is a director.

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