MTN South Africa has lost a case at a special tribunal related to the alleged irregular supply of mobile devices worth over US$541,000 for Covid-19 screening to the Limpopo Department of Health (LDH).
This comes after the South African Special Investigating Unit (SIU) launched a probe into the affairs of the LDH and found that “MTN made an unsolicited proposal to supply the department with 10,000 cellphone devices intended for Covid-19 mass screenings” in that province.
“This proposal cost the department R10 million ($541 million+). This falls outside the provisions of the Public Finance Management Act. The department of health accepted the proposal and subsequent delivery of the devices,” the SIU said.
“The SIU’s investigation also found that the former head of the department, Thokozani Florence Mhlongo, as the accounting officer, allegedly exposed the department to wasteful expenditure when she authorised the procurement of and payment for 10,000 cellphones to the value of $541,000 for Covid-19 household screening.
“The department could only manage to distribute 388 of the 10,000 cellphones between September 2020 and March 2021, and the phones were distributed without the required screening application,” the SIU said.
The corruption-busting unit added that it has instituted civil action through the special tribunal “to review and set aside the contract and recover financial losses suffered by the Limpopo Department of Health.”.
“So far, the SIU has successfully interdicted the pension payout of Mhlongo after she resigned from her position as head of the department in the face of disciplinary action,” it said.
“The SIU is also empowered to institute civil action in the high court or a special tribunal in its name to address any wrongdoing uncovered during investigations related to acts of corruption, fraud, or maladministration. In line with the Special Investigating Units and Special Tribunals Act, the SIU refers any evidence of criminal conduct it uncovers to the National Prosecuting Authority for further action,” the unit said.
In response to a query from TechCentral, MTN confirmed that it submitted the proposal to the Limpopo department of health for the supply of the 10,000 cellphones and that the proposal was accepted in April 2020.
In the summons issued by the SIU to MTN, the former claimed that the payment made by the Limpopo health department to MTN amounted to fruitless expenditure and that MTN must be “disgorged” of profit it made from the transaction.
“MTN applied for exception of the summons on the basis that the SIU did not disclose a cause of action and never alleged anything unlawful and unconstitutional done by MTN,” the mobile operator said.
“The special tribunal dismissed MTN’s exception application. We are now considering the summons on the merits of the case and will prepare MTN’s plea in answer to the summons.”
