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Investigation into Auditors and Lawyers Embroiled in PRASA Corruption Scandal

Published March 20, 2024
2 months ago

A shadow looms over the prestigious fields of law and auditing as the Independent Regulatory Board for Auditors (IRBA) has now formally opened an investigation into audit firm WKH Landgrebe's role in the embroilment of corruption within the Passenger Rail Agency of South Africa (PRASA). The probe triggered by detailed findings from two forensic auditors, Ryan Sacks and Jan Dekker, scrutinizes a multitude of excessive payments and diverted proceeds, some of which were allegedly funnelled to the African National Congress (ANC).

WKH Landgrebe, having received a sum of R32.6 million from Swifambo between April 2013 and May 2017, ostensibly for audit and legal fees, is under the microscope for these financial involvements that appear "very excessive," as per Ryan Sacks' assessments. Additionally, payments made to law firm Nkosi Sabelo Attorneys are now also part of a civil claim by Swifambo's liquidators in an attempt to recover the funds.

A startling revelation shows the tendril connections proliferating into companies like Bahn Wheels and Enerwaste Solutions, linked to businessman Makhensa Mabunda, without any corresponding record of Landgrebe's official auditor engagement within the CIPC database. The stipulations from the Financial Advisory and Intermediary Services Act demand dutiful reporting of such non-compliance and potential money laundering activities, which purportedly have not been acted upon.

Wolf Landgrebe's reticence to comment, as advised by legal counsel pending a resolution, mirrors the silence of implicated banks. Despite Financial Intelligence Centre Act (FICA) requirements to report odd transactions, neither Standard Bank nor Bidvest Bank had reportedly raised alerts on Swifambo's suspicious activities, which should have been evident given the company's lack of meaningful financial history.

Moreover, while Van Wyk Auditors were not directly Swifambo's auditors, they were implicated through their financial services, which further called into question the legitimacy of Swifambo’s financial disclosures. PRASA's former head, Popo Molefe, flagged these financial reports as unreliable, echoing concerns of Sacks on their role in potentially concealing true fund disbursement nature.

Amid the imbroglio, Nkosi Sabelo's payments are particularly scandalous, tied to the ANC and luxury spendings at a Cartier boutique store. The involvement of Sabelo and ANC fundraiser Maria Gomes has become of special interest, as hefty transactions were traced from Swifambo to Gomes and then notably redirected to the ANC, as confirmed by the Dekker report.

This tale of corruption intertwined within PRASA's aborted dealings with Swifambo, a company revealed as a front with no historical trading, uncovers a disquieting schemata of fluctuating funds, corrupt contracts, and potentially unlawful financial manipulation, all while the watchful eyes of banks and regulatory bodies ostensibly turned blind.

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