Family, employees charged in R88m SAPS fraud

A family and several employees are facing serious charges in connection with an alleged R88 million tender fraud scheme linked to the South African Police Service (SAPS).

The group appeared in the Pretoria Magistrate's Court on Thursday, where they face 330 charges, including fraud and money laundering in contravention of the Prevention of Organised Crime Act.

The court postponed the matter to March 28 for formal bail applications.

At the centre of the scandal is Matthew Pillay, who stands accused alongside his mother Devi Sigamoney, his wife Lisa Pillay, and four of his employees, Bernard Mutimotema, Nithianathan Govender, Tinashe Moyo, and Betty Makinta.

The implicated companies, KJP Trades, Bohlale Traders, and Swift Warehousing, are also listed as co-accused.

Investigating Directorate Against Corruption (IDAC) spokesperson Henry Mamothame said the alleged fraudulent scheme dates back to March 2012, when Pillay registered KJP Traders under his mother’s name, without her knowledge, as a front to qualify under Black Economic Empowerment (BEE) legislation.

This maneuver was intended to exploit the requirements of the Broad-Based Black Economic Empowerment Act and the Preferential Procurement Policy Framework Act (PPPFA), which promote the inclusion of previously disadvantaged groups, including women and small enterprises, in state contracts.

"In 2019, KJP Traders bid for a tender in the SAPS to provide office furniture in KwaZulu-Natal, Eastern Cape, Western Cape and Gauteng, with Sigamoney meeting all the requirements as per the false registration of the company," said Mamothame.

The bid was ultimately successful, securing a lucrative three-year contract to supply office furniture in the provinces, a victory built on deception and collusion.

The legal requirement to sub-contract 30% of the contract to local businesses was allegedly met by registering shell companies, under false addresses, linked to Pillay’s associates and employees.

" A further collusion ensued when one of the companies which was registered under Makinta also bid for the main contract to disadvantage other bidders," said Mamothame.

The bid documents reportedly misrepresented KJP Traders’ VAT status, falsely listed ownership details, and falsified information about the supposed subcontractors.

The authorities allege this was all part of a coordinated plan to secure the tender through fraudulent means.

The matter was postponed to Friday, March 28 for formal bail applications.

Cape Argus