Blacklist them: SIU says state should not work with Digital Vibes again
Evidence justifies 'the blacklisting of Digital Vibes from conducting business with the public sector', says SIU
Digital Vibes should be blacklisted from ever doing business with the state.
This is what the Special Investigating Unit (SIU) has recommended in its investigation report sent to President Cyril Ramaphosa in June, into the department of health’s R150m Digital Vibes communication tender scandal.
Ramaphosa released the report on Wednesday amid public pressure to do so, after sitting on it for months.
According to the SIU, Digital Vibes was merely a front company used by close associates of former health minister Zweli Mkhize to enrich themselves.
The company was used as a “front being exploited by Ms Tahera Mather” and should not be allowed to do business with the state.
According to the SIU, Mather and Naadhira Mitha, associates of Mkhize's, had used a petrol station garage manager, Radha Hariram, as a front to shield that they were the true owners and controllers of Digital Vibes.
It added that Hariram did not have any control over the company at any time, and that Mather was responsible for getting Digital Vibes contracts and for its finances.
“The obtained evidence indicates that even though de jure Digital Vibes belonged to Ms Hariram, de facto Ms Mather and Ms Mitha were in complete control of the activities of, and the bank accounts belonging to, Digital Vibes,” the report reads.
It added that the company created a fraudulent profile, adding names of experienced consultants, to make it appear capable of doing the job.
The SIU said Mather and Mitha distributed the money received from the contract to third parties, who received significantly less than the duo. These payments include:
- R20m to Mather's company;
- R16m to Mitha and her company;
- R2.5m to Hariram;
- R11.5m to Mather's family members and their respective businesses;
- R36.7m to individuals who had worked with or were linked to Mkhize (staff members of the minister); and
- R3.1m in suspect payments to other companies (SP Attorneys and Royal Bhaca Projects).
“A large amount of money was paid to family members and associates of both Ms Mather and Ms Mitha, without them having conducted any work or providing any services to Digital Vibes. These transactions were done unlawfully and without her knowledge or consent, and constituted theft and fraud,” the report reads.
The company irregularly scored a R150m communications contract in the department of health initially for the National Health Insurance system, but the tender was eventually extended to also cover Covid-19 awareness when the novel coronavirus reach SA shores.
Even after receiving this enormous contract, Digital Vibes still failed to pay company tax and VAT.
“Taking into account the amounts of money received from the [department], and taking into account an analysis of the bank account(s) of Digital Vibes, it appears that Digital Vibes failed to declare and pay company tax and failed to pay the required VAT to the SA Revenue Service,” the report reads.
The SIU said this evidence justified “the blacklisting of Digital Vibes from conducting business with the public sector”.
It said it was doing further investigations to “identify more potentially corrupt payments”.
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