SIU wants former Transnet executive Msagala's assets forfeited to the state
The Special Investigating Unit (SIU) on Tuesday pushed for the frozen assets belonging to former Transnet Capital Projects executive Herbert Msagala to be forfeited to the state.
The SIU and Transnet were on Tuesday seeking a final forfeiture of assets which were attached through a freezing order issued by the Special Tribunal on July 30.
The order of July 30 froze the assets belonging to Msagala and his investment trust and family trust, and movable and immovable properties under curatorship. These include more than 30 vehicles, bank accounts, two farms in the Free State, and a plot in Dainfern, Gauteng.
The SIU and Transnet seek the order for forfeiture because they believe these assets were benefits of unlawful activities by Msagala.
They believe he allegedly received the assets from IGS Consulting Engineers, a company given questionable tenders from Transnet Capital Projects when Msagala was executive.
In December last year, the high court in Johannesburg set aside five of the contracts concluded between Transnet and entities where IGS was involved.
The high court found that compulsory internal procedures and protocols concerning the procurement of goods by Transnet from third parties were not followed in the awarding of five contracts where IGS was involved.
The court held these procedures were bypassed on the instructions of Msagala, who had a relationship with IGS's sole director, Sipho Sithole.
In its judgment, the high court said during the same month after IGS had received its first payment from Transnet in September 2015, Msagala registered three trusts. One of the trusts acquired four immovable properties totalling R15.2m, all paid for in cash.
Over and above these purchases, Msagala purchased seven vehicles within one year, including a Maserati GranTurismo.
When the tribunal froze Msagala's assets on July 30, it called on all affected parties to show cause why the frozen assets should not be declared forfeit to the state and handed over to Transnet.
Counsel for the SIU, Paul Kennedy, told the Special Tribunal on Tuesday that a proper case has been made for the relief sought by the SIU.
He said the assets belonging to Msagala were proceeds of unlawful activities.
Kennedy said Msagala has failed to give a proper explanation on the cash amounts he received, allegedly from IGS, during 2015.
He said due to investigations by the SIU, it can be shown there was overwhelming evidence that vast amounts of money were received by Msagala from IGS.
There was evidence of cheques being cashed by IGS and the same cash amount being deposited into Msagala's bank accounts on the same date, he said.
Kennedy said Msagala's version was that he deposited these amounts as income from properties he rented out and the cars he sold. He said Msagala cannot explain in his affidavit how these side businesses operate and does not provide details on these deposits.
However, Henk Louw for Msagala said the SIU had not proved there was unlawful conduct by Msagala.
Louw said Transnet held disciplinary proceedings against Msagala concerning allegations of a corrupt relationship with IGS and Msagala was acquitted of all charges.
He said Msagala maintained there was no evidence that money paid by IGS or Sithole came to him or his trusts.
"He denies receiving the money," Louw said.
The tribunal reserved judgment.