The Durban Specialised Commercial Crimes Court on Friday has sentenced Mlungisi Brian Khumalo, 46, to an effective 15-year imprisonment after he pleaded guilty to defrauding the KwaZulu-Natal Department of Agriculture Environmental Affairs and Rural Development (DOA) of almost R1.5 million.
According to the National Prosecuting Authority (NPA) regional spokesperson, Natasha Kara, Khumalo pleaded guilty to eight counts of fraud and 14 counts of money laundering.
“Khumalo was sentenced to 15 years’ imprisonment for eight counts of fraud and 10 years’ imprisonment for 14 counts of money laundering. Since the sentences will run concurrently, he will serve an effective 15-year imprisonment,” she explained.
Kara said Khumalo used companies he was affiliated with, namely Khumzi Business Solutions (Khumzi) and Ubhaqa Lwethu Services Resources Development (Ubhaqa), to receive and move the funds.
In his plea, Khumalo said that he met his co-accused Nkosinathi Emmanuel Mkhize in 2012 at the DOA offices in Cedara in Hilton at Pietermaritzburg. Mkhize was working in the logistics section of Supply Chain Management for the DOA.
Mkhize has already been sentenced to 16 years’ imprisonment for this case after he pleaded guilty in December 2020.
Khumalo said in 2012, he used to regularly visit the DOA offices in Cedara, to check if there were any tenders published on the notice board. Khumalo became acquainted with Mkhize, who told him that he managed and oversaw a substantial budget at the DOA and that he could create tender contracts and authorise payments for those contracts.
Moreover, Khumalo said Mkhize told him that they could make a substantial amount of money if they worked together.
They then colluded, and Mkhize falsified documents to create an impression that a tender had been issued to Khumalo for services rendered by the companies (Khumzi and Ubhaqa), to the DOA. Invoices were submitted by Khumalo’s companies and the DOA paid approximately R1.5 million.
Neither Khumzi nor Ubhaqa had rendered the services for which the payment was received. The funds went from the DOA into the bank accounts of both companies. From there, Khumalo transferred the money into his personal bank account.
Thereafter, sums of money were given to Mkhize either via his bank account or in cash. The matter came to light when the Chief Financial Officer at the DOA discovered the fraud, and the pair were arrested.
In aggravation of the sentence, Advocate Ranjini Govender led the evidence of the Chief Financial Officer of the department, who testified on the financial loss suffered because of the offences.
“Offences hurt the work of the DOA, as they subsidise farmers who raise livestock and grow produce, which inevitably ends up in households. The loss of money means that products need to be imported, and there is a shortage of food,“ said the DOA official.
The Asset Forfeiture Unit (AFU) in KZN was not able to recover any of the money, as they found that Khumalo did not own any assets.
Furthermore, the evidence in Mkhize’s case showed that Mkhize had a similar agreement to that of his agreement with Khumalo, and with other people.
The AFU of the NPA was able to secure an amount of about R200 000 from Mkhize’s bank account, in addition to the sentence.
“The NPA welcomes the sentence and conviction. The NPA and the Directorate for Priority Crime Investigation (DPCI) remain committed to the fight against commercial crimes,” said Kara.
The provincial head of the DPC Major General (Dr) Lesetja Senona applauded the investigation team as well as the prosecution of the good work.
“This sentence demonstrates the determination of the DPC and the NPA’s efforts to fight fraud as well as corruption in our country,” he said.