Major South African city paid millions to people who are dead or did not exist

[Nat Quinn]

Major South African city paid millions to people who are dead or did not exist

The eThekwini Metropolitan Municipality, which includes Durban and surrounding towns, lost millions due to payments made to unauthorised beneficiaries.

The municipality’s latest annual report revealed that it lost R3.3 million and was likely to lose another R2.3 million due to payments made to unauthorised beneficiaries.

These payments were made to fictitious beneficiaries, deceased beneficiaries, and beneficiaries employed in other state institutions.

The annual report further highlighted that the municipal expenditure controls and procedures were entirely ineffective in detecting and preventing these payments.

The bulk of the financial losses occurred in 2022, and the accounting officer was notified of this in December 2022.

The report stated that the accounting officer implemented multiple investigations but did not follow all of the recommended procedures.

The investigations and procedures taken by the accounting officer were ineffective in any rectification or disciplinary actions.

As of June 2024, no responsible parties for this wasted money had been identified, and no disciplinary actions had been taken.

The eThekwini Metropolitan Municipality has struggled with financial problems and mismanagement for years and lost millions.

Its reporting showed that between 25 May 2018 and 6 January 2020, there were possible fictitious payments made without any goods or services received.

Officials at the municipality overwrote internal controls to ensure that the service provider received payment.

After the accounting officer was notified, neither the municipality nor the service provider could produce evidence that the billed services were delivered.

As a result of the potential fictitious payments, the eThekwini Metropolitan Municipality incurred a R21 million loss.

There were seven similar cases taken to the high court where the municipality claimed R58 million paid for services that were not received.

However, the annual report did not indicate whether any of these claims were recouped by the service providers.

The annual report stated that the responsible officials were referred to disciplinary action through the financial misconduct board.

It did not state whether the officials were dismissed or provide any details regarding their positions within the municipality.

source:Major South African city paid millions to people who are dead or did not exist – Daily Investor

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