The Hawks’ Serious Commercial Crime Investigation unit in Welkom has arrested a former municipal accounting officer and a service provider, along with his company, in connection with a R530,000 fraud case from 2019.
Free State Hawks spokesperson, Warrant Officer Fikiswa Matoti, confirmed that the suspects, aged 42 and 57, were detained for their alleged involvement in fraudulent activities related to irregular debt collection services procured by the Bultfontein municipality.
Investigations show that in August 2019, the former municipal official improperly appointed a service provider for debt collection without following proper municipal supply chain procedures. A payment of R530,190.80 was later made to the service provider, despite no services being delivered.
The irregularity was uncovered after the Auditor-General South Africa (AGSA) identified the transaction in an official report. The report noted wasteful expenditure and alleged that the service provider had submitted fraudulent documents and invoices. Municipal councillors escalated the matter, leading to a formal complaint and the Hawks’ investigation.
The suspects face charges of fraud, contravention of the Municipal Finance Management Act, and violation of the Debt Collectors Act.
The former official, the service provider, and his company are set to appear in the Bultfontein Magistrate’s Court today.