Ithala boss suspended
Embattled Ithala Development Finance Corporation Group chief executive Sipho Shabalala has been suspended after reports that a criminal investigation will be conducted against him.
Shabalala's assets - including the City Royal Hotel in Pietermaritzburg, his Othandweni farm and 2 luxury cars - were seized during a R200 million tender fraud crackdown
KwaZulu-Natal MEC for economic development and tourism Mike Mabuyakhulu said: "The board has decided to suspend Shabalala on a precautionary basis pending developments in the proposed criminal investigations."
Shabalala's assets, including the City Royal Hotel in Pietermaritzburg, his Othandweni farm, Range Rover and Mercedes-Benz were seized during a R200 million tender fraud crackdown by the Hawks and the asset forfeiture unit last Wednesday.
Eight people were arrested during the raids while Shabalala was not.
Mabuyakhulu said the Ithala board and provincial government were concerned about the effect the allegations might have on the financial services and property development company, which is owned by the KwaZulu-Natal government.
Acting board chairperson Nomcebo Zondi was appointed Ithala chief executive.
The acting chief executive would be appointed no later than this week.
Ithala board is expected to set up a task team to monitor the investigation that will advise the board in three months.
Shabalala was head of the KwaZulu-Natal treasury when the R200million tender fraud in the provincial health department allegedly took place.
Three people were arrested in KwaZulu-Natal and five in Cape Town during the raids on Wednesday. They included former KwaZulu-Natal health department head Busi Nyembezi, the department's former procurement officer Mdu Ntshangase and the provincial legislature's current chief financial officer Sipho Buthelezi.
The crimes relate to alleged attempts to defraud the provincial health department by inflating the price of water purification equipment for hospitals.
One purification plant, valued at R420000, was allegedly sold to the department for R4million.
The eight face fraud, corruption and money laundering charges and charges under the Public Finance Management Act.
Mwelase
This ithala was the money lender to the ANC members. All they are getting loans there without repaying back. Shabalala you deserve jail.Report Abuse
Tatiana
This is so dissappointing, all these well paid people have been getting loans from the iThala bank, huge amounts of money, including the Premier's wife. I wonder if they pay it back. Shabalala deserves jail, unbelievable, how can he be so greedy while most of struggle. A farm hotel. big cars!!! Good work Hawks. Now you need to look at Police Commissioner find out who is buying all these suits & hats for him...Report Abuse
Zwide
It is said to see our leaders in Business compromising their hard earned leadership skills and experience. The tendencies we have of get rich now approach is soon catching in with us sooner than we thought.Report Abuse
MAKABAZA
HOLA THE HAWKS HOLA, SO THEY MUST PAY IT BACK BY DOING THE GENERAL WORK AND REMEMBER PAY BACK IS NOT NICE PAPA!Report Abuse