THE Passenger Rail Agency of South Africa said yesterday that it has instituted a R20-million lawsuit against the South African Transport and Allied Workers Union and its president Ephraim Mphahlele.

The action follows Satawu's claim that Prasa's group chief executive Lucky Montana was corrupt and guilty of nepotism.

"Prasa and myself, as group CEO have instituted legal action against Satawu and Mr Mphahlele, holding him accountable for all the false information he has spread to our employees, the media and the public," said Montana.

Prasa spokeswoman Nana Zenani said that the parastatal was suing Satawu and Mphahlele in his personal capacity.

"We are suing Mphahlele in his personal capacity and Satawu as an organisation."

She said Prasa was suing for defamation of character because the accusations against Montana and the company were false.

Mphahlele called a media briefing on January 31 where he presented a dossier with the details of allegations of corruption against Montana.

The allegations contained in the dossier, which he said was compiled by Prasa employees, had claims of corruption ranging from irregular awarding of tenders for security services and the procurement of new railway rolling stock.

In one advertising deal, Satawu claimed that the company had squandered R2-billion over five years.

Tensions between Satawu and Prasa gained momentum last week when union members in the rail sector embarked on a strike demanding that Montana be put on special leave or suspended while an investigation against him was instituted.

Satawu was this week slapped with a court interdict calling the workers to return to work.

Attempts to get a comment from Mphahlele were unsuccessful yesterday.

Satawu spokeswoman Reagoikanya Molopyane could not confirm if the union had received letters from Prasa lawyers. She said Mphahlele was attending a meeting.