KDM investigates printer fraud

All hell broke loose at the KwaDukuza municipality when it was recently discovered that two contracts for the same service had been irregularly signed, which could have cost the municipality over R10 million of public funds.

As a result, KDM is investigating what may be a case of internal fraud to the loss of about R1.8 million in just six months.

Also read: KDM promises service despite Salt Rock strike

It is believed that the municipality had appointed a new printing company to supply office printers and to service the machines in March this year, after the previous contract ended.

Along with the new contract, an additional, irregular three-year contract for the same service was signed, allegedly while municipal manager Nhlanhla Mdakane was on leave for five weeks.

According to an anonymous source from within KDM, the result was that printing costs escalated from R30 000 a month to about R300 000 a month. This went unnoticed for six months and if it had continued for the three-year term, would have resulted in a loss of over R10 million.

It is believed that soon after the discovery was picked up by the KDM finance department, the municipal manager received threatening phone calls demanding that he not look further into the issue.

Both contracts are reportedly on hold due to the fraud investigation.

The matter has been kept under wraps by senior officials and it is believed that those who are aware of the issue were asked to sign a confidentiality agreement. An external investigator has apparently been appointed to find the culprits and how the fraud happened.

It is not known who signed the papers for the second contract but it is suspected it was slipped into a pile of papers sent for signing.

Whoever was in charge while the municipal manager away probably did not bother to look what was in the papers but continued to sign, our source said.

KDM has since removed the new photocopy machines from all their offices and replaced them with old ones, most of which do not work.

KDM knowledge and communication officer Sphelelo Ngobese confirmed the investigation but said, “The foregoing matter is being investigated and we cannot comment at this point, obviously due to the ongoing probe into the matter.”

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  AUTHOR
Erica Abrahams
Journalist

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