Elite unit to probe SABC losses, fraud

A probe into millions of rand lost through fraud and corruption at the SABC, some of it squirrelled away in foreign bank accounts, has been officially launched, giving the Special Investigating Unit (SIU) the right to access the accounts and documents of staff and companies suspected of a crime, and to seize assets where necessary. by Chantelle Benjamin and Sam Mkokeli

The investigation was approved by President Jacob Zuma last week with the aim of recovering some of the money lost through corruption, fraud and management negligence at the SABC. The inquiry will include unlawful activities dating back as far as 2005.

The proclamation allows the SIU, which is empowered by law to inquire into and recover losses through civil lawsuits, to investigate the financial affairs of the broadcaster, paralysed by years of mismanagement and political interference, and to investigate the finances of companies and staff, as well as members of the corporation's board.

A senior SABC official said yesterday the board decided to approach the SIU for assistance after an initial investigation suggested the scope and sophistication of the crimes were "beyond the ability" of the SABC's internal investigation division.

The Department of Communications was approached to provide funding for the investigation, which required forensic research, which the minister approved.

Officials battled to quantify the amount lost over the past five years, but the SABC's annual report and a recent hearing by Parliament's standing committee on public accounts (Scopa) indicates that millions may have been stolen from the SABC, and just as much lost through negligence or poor procedure.

The cash-strapped SABC's annual report to March 31 listed 14 cases amounting to R184m in criminal or irregular expenditure. The full amount was written off. When it came to losses through fruitless and wasteful expenditure, R70m was identified but R48m was eventually written off. It is not clear if the rest was recovered.

At a Scopa hearing last Wednesday, it was revealed that 11 senior managers had run up R11m in petrol card expenses in the 2008-09 financial year. One staff member even used a petrol card to pay for a new engine and gearbox for his own car, at a cost of R72000.

An interim investigation was launched by the SIU, at the urging of the present board, following a particularly damning auditor-general's report, released in September last year.

That report raised questions about 169 contracts valued at R1bn, as well as irregularities amounting to R111,746m relating to double payments, overpayments, material paid for but not received, agreements that had to be renegotiated, and programme titles acquired more than once from a supplier during one licence period.

The auditor-general found the corporation had paid more than R3m to 20 employees who were also directors of companies or members of close corporations that provided services to the SABC, and questioned the awarding of seven tenders, valued at R174m, between September 2007 and June 2009.

The auditor-general's investigation was prompted by reports sent by some trade unions with members at the corporation, alleging widespread corruption and poor management.

An SIU spokesman said yesterday: "The SABC investigation is an important one, supported by staff, the unions and the board of SABC as well as the Department of Communications. The SIU is pleased the proclamation has been signed, and work is ongoing."

The scope of the SIU investigation will take matters further than the auditor-general's probe.

It will include board members and employees with undisclosed interests in companies doing business with the SABC, as well as the sales and marketing division, particularly with regard to the alleged abuses of the SABC's advertising discount policy.

Unauthorised discounts and airtime deals reached excessive levels last year as the loss-making public broadcaster scrambled to make as much cash as possible to make up for its dwindling television and radio audiences.

The mismanagement of funds also falls under the spotlight, with investigators tasked to follow irregular payment of salaries, commissions and allowances to staff who do not qualify for the benefits. Some payments were allegedly made to staff who had left the organisation.

The investigation was welcomed by the Broadcast, Electronic Media and Allied Workers Union and the Save Our SABC coalition, which said such a probe would send out a message that corruption will no longer be tolerated.

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