Another water deal for dodgy CMS despite fraud charges

The department of water and sanitation says it had no knowledge that a company it awarded a R4m contract was facing criminal charges related to tender fraud.

The department awarded CMS Water Engineering a three-year tender valued at R4.6m in March last year at the Usutu Vaal Water Area near Standerton in Mpumalanga, according to department spokesperson Wisane Mavasa.

CMS, owned by Rudolf Schoeman – the late associate of ANC benefactor Edwin Sodi, was in a joint venture that had its work terminated in the failed Rooiwal wastewater treatment plant upgrades in Tshwane.

Two years before the awarding of the contract by the department, fraud charges were laid against CMS in Rustenburg, North West, after the company allegedly submitted invoices for work not done.

The auditor-general (AG) flagged the company for irregularities in the awarding of a R85m tender to upgrade and extend Bospoort water treatment works in May 2019.

In August last year, five months after CMS's appointment to carry out maintenance and repair work at the Usutu Vaal, the City of Tshwane terminated its R292m contract awarded to a joint venture between NJR Projects, Blackhead Consulting, both owned by Sodi, and CMS for poor performance in the upgrading of Rooiwal.

The collapse of the Rooiwal project, which was meant to alleviate water problems in cholera-hit Hammanskraal, has been brought into sharp focus after the outbreak of the waterborne disease in the area that has killed more than 20 people.

In the Usutu Vaal contract, the department told Sowetan it had already coughed up R869,077.

The department conceded not doing any other due diligence before awarding the contract, "apart from verification of required documents as advertised and evaluated information. It is required by National Treasury to check if suppliers are not restricted and if they are tax-compliant prior the award," said Mavasa

Mavasa said the department wasn't aware that CMS was accused of fraud in Rustenburg at the time it was evaluating and awarding the Usutu Vaal contract to the firm. She also said the department did not know that the AG had picked up red flags about the company, nor did the department know about CMS's terminated contract in Tshwane. 

CMS is based in Orkney, North West, and has been in existence since 2000, and according to the companies registry, CMS has three active directors who include Dolf Schoeman and his late son Rudolf, who died in March, and Clint Adonis. 

Schoeman Snr, 73, told Sowetan yesterday that while he is listed as one of CMS's directors, he retired three years ago from the company, leaving his son to run it. He also claimed not to have been aware of financial transactions in the projects CMS did for the government. He also claimed that CMS was in the process of being liquidated but he did not want to give further details about this process.

He said he couldn't take blame for Rooiwal's failure or for the people of Hammanskraal not having clean water because "as far I remember, Rooiwal was a water treatment plant and not a purifying plant".

"Our job was not to clean the water but to collect it and then send it to another plant where it gets purified and then sent  to the community. As far as I know, another entity or contractors of ours was collecting and processing the water before it got sent for purification. We can't shoulder the blame for the cholera in Hammanskraal as we worked as a JV [joint venture].

"My son should also not be blamed for the water problems of Hammanskraal, he was a businessman who saw an opportunity to grow and to also help the people," he said.

On the Rustenburg fraud accusation, Schoeman said he heard about the case, but he has had no visits from law enforcement.

Regarding Sodi's business ventures with CMS, Schoeman said he was not sure if he ever met him. 

"I might have met him because I used to visit my son a lot in Bryanston and he'd introduce me to different people and business partners in Johannesburg," he said.