Former Transnet exec's earnings do not add up, tribunal hears
A Special Investigating Unit (SIU) senior forensic accountant said money deposited into the bank accounts of former Transnet Capital Projects executive Herbert Msagala were more than what he was said to have earned from his employment and other businesses.
Ismail Varachia told the Special Tribunal on Thursday that between 2009 and 2016, significant amounts of money went into and out of Msagala's bank accounts.
He said some of the amounts paid to Msagala could not be accounted for.
The SIU alleges that some of the cash in Msagala's bank accounts were the benefits of unlawful activities.
They believe that Msagala allegedly received the assets from IGS Consulting Engineers, a company given questionable tenders from Transnet Capital Projects when Msagala was executive.
In December 2019, the high court in Johannesburg set aside five of the contracts concluded between Transnet and entities where IGS was involved.
In his affidavit disputing the SIU's claims, Msagala said that in 2016 he earned several payments from a number of businesses, apart from his employment.
However, Varachia said some of the income he claimed to have made did not reflect on his bank statements.
Varachia said he checked deposits made into Msagala's Nedbank account from 2010.
When asked by SIU counsel Paul Kennedy SC why Varachia had probed statements from 2010, he said when explaining his income from 2015, Msagala had — in his affidavit — stated that he had acquired three properties in 2009.
Msagala also said he received rental income of R222,000 from those properties between 2009 and 2010.
Msagala stated this money was used to start a catering business, which also earned him an extra income.
Varachia told the tribunal that the SIU probe of Msagala's bank accounts established that only R85,000 was deposited into the Nedbank account between 2009 and 2010.
The tribunal also heard that various card withdrawals were made from various casinos in 2015 and 2016.
Varachia said on December 5, 2015, five withdrawals totalling R122,000 were made at Montecasino.
Varachia said in total, R3.5m was withdrawn at various casinos in 2015.
The trial into the alleged financial irregularities involving Msagala, which got under way in the Special Tribunal on Monday, continues next week.
Msagala was not present to put his version forward. He withdrew from the case on Monday because he did not have legal representation, after his lawyers had withdrawn from the case on Sunday.
Seeking a postponement, Msagala had told the tribunal that he had approached Legal Aid SA for assistance and was awaiting response.
When tribunal judge Lebogang Modiba refused his request for a postponement, Msagala asked to be excused from the case.
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