A former Gauteng Department of Health service provider has publicly accused the department’s acting head Arnold Marotane and two other senior officials of being involved in a bid-rigging scheme that allegedly netted them hundreds of millions of dollars.
Malotana, along with department officers Edgar Mota and Sergeant Lecholo, are accused of manipulating supply chain processes to ensure that medical device company BAS Medxpress (BAS Med) won two tenders in 2016 and 2017.
In exchange, the informant told authorities, the three officials received millions of dollars in bribes.
BAS Med is owned by Roodepoort businessman Landus Armstrong, who owns a number of businesses within the Bhekani Abantu Services Group (BAS Group), providing security, cleaning, medical supplies and transport services.
AmaBhungane has obtained copies of an explosive affidavit submitted by an insider to the Priority Crime Squad (Hawks), which includes emails, contracts, invoices and bank statements as evidence of corruption allegations.
The documents show that at the time of the alleged incident, all three held senior positions in the department, which gave them access to confidential information about upcoming contracts and tenders.
Marotana is the Chief Director of Special Projects at the Gauteng Provincial Health Authority and the Chief Executive Officer of the Gauteng Ambulance Service.
Mota is the deputy director of the Special Bureau of Laundry and Garbage Removal, while Lecholo is the assistant director of supply chain contract management.
amaBhungane knew the identity of the man who was working closely with Armstrong at the time and claimed that the bribe was split between the two bidders.
The first tender is a R31 million contract to supply plastic food containers to the Masakhane department’s laundry and cold storage factory, which produces food for six hospitals and 17 health centers in Gauteng.
It is alleged that Malotana, Motha and Lecholo received “more than R8 million” in supposed aid.
BAS Med was then allegedly selected as part of a group of service providers to supply orthopedic equipment and surgical implants to hospitals in Gauteng and subsequently received a R3 million kickback.
Bank statements seen by AmaBhungane show that almost R2 million of this amount was transferred from BAS Med’s bank account to two companies allegedly linked to the officials.
AmaBhungane confirmed links between the officials and one of the two companies through the company’s directors, although he denied facilitating any payments to them.
Other than the payments mentioned above, there appears to be no obvious trace of money between the trio and BAS Med’s Armstrong. The whistleblower claims this is because most of the kickbacks are paid in cash.
Most notable among his allegations is that the insider admitted his involvement in the scheme and admitted that he was “repeatedly present in the preparation or payment of government funds to officials.”
Armstrong responded through his lawyer, denying the allegations but refusing to answer any questions regarding the ongoing investigation by the Eagles and the SIU.
“Our client has been cooperating with the investigation at this time and since approximately September/October 2022 and will continue to do so in the future,” his lawyer said.
“Our client denies the allegations contained in your response letter and reserves the right to respond in the appropriate forum and at an appropriate time.”
Marotana reacted in a similar manner, saying he could not respond because the investigation was still ongoing and that he was “cooperating fully” and awaiting the “expected outcome.”
“I remain committed to clarifying most of the issues raised by the investigation in due course,” he concluded.
Motta also declined to answer, with Leccolo telling CNN: “I would like to answer these questions, but I can’t because the case is still under investigation.”
The Eagles confirmed to amaBhungane that the investigation is ongoing but no one has been charged.
In 2016, BAS Med won a three-year tender to manufacture and supply plastic containers used to package frozen foods produced at the Masakhane Cook Freeze plant in Gauteng Health.
Masakhane serves more than 115,000 meals a month to patients in 6 hospitals and 17 community health centers.
The three-year contract is valid from April 1, 2016 to March 31, 2019. year of the desert bath.
The informant said there were “numerous meetings” between Armstrong, Marotana, Motta and Leccolo before the bid was won.
The winning bid, published on the Gauteng provincial government’s public tenders portal, showed that a total of 16 companies responded to the tender notice.
Bidders will be assessed on technical compliance with tender specifications, as well as price and BEE status, using the 90/10 preference system set out in the Preferential Procurement Policy Act.
There is little publicly available information on the technical and price estimates received by each bidder, but award tables show that BAS Med was the only company to achieve a BEE score of 10, while all other bidders received scores below 5.
It was clear that the solution presented by BAS Med was not the most affordable option in terms of price, scoring 90% in the second stage of evaluation.
The company’s three-year R31 million bid was the third largest of 16 bids received by the Gauteng health department.
People familiar with the matter say BAS Med’s advantage lies not in its technical expertise, but in the company’s “contacts” that “helped approve” its application.
For example, the tender for plastic containers was published in the government gazette on April 10, but emails show BAS Med had two weeks to prepare bids after receiving Motha’s tender specifications on March 23.
The whistleblower provided the Hawks with a series of emails showing Mosa used his Gauteng Health email address to send specifications to Armstrong.
In the email, the official simply advised Armstrong to “be on the lookout” for the specifications appendix hidden under the front page of the liquor store flyer.
Mota declined to answer written questions sent by amaBhungane, saying in an email that he “reserves his rights.”
However, in a brief telephone conversation with an amaBhungane reporter, Mota did not confirm whether he had sent the specifications to Armstrong and tried to suggest that the document could have been sent by someone else with access to his email.
“My understanding is that when you work in contract management or advertising tenders, you are the one who sits and makes decisions,” Mota said. “I’m not even the [CFO] who can manage contracts.
Documents obtained by amaBhungane show that Mota’s colleague and colleague, assistant director of supply chain contract management Supt Lecholo, was involved in the tender process.
As part of the technical evaluation, bidders must provide samples of their products for testing in Masahan.
This is because the products required for Masakhane are highly specialized and not common containers that can be easily purchased.
For example, a three-chamber container must withstand temperatures from minus 30°C to 150°C without collapsing or affecting the quality of food products.
Medical device company BAS Med has no experience making food packaging, but people familiar with the matter said “Mr Leholo provided them with samples of plastic containers” and then submitted the samples to tender.
Leholo is also accused of allowing the company to change its bids, including prices, after BAS Med submitted its bid on April 30, the deadline for all bids.
“On the evening of Sunday, May 3, 2015, I received a call from [Armstrong] regarding the tender we submitted on April 30, 2015. He advised us that we needed to lower our prices and was angry about the tax liquidation of our company. The Company Certificate was apparently not included in the tender documents.”
Armstrong told him the documents must be submitted “before the adjudication committee meeting next Monday morning,” people familiar with the matter said.
“I emailed the price and clearance certificate to Mr. Landus Armstrong and then delivered the original documents to Mr. Lecholo, Sheriff of Oriental Plaza, Fordsburg, on Monday, May 4, 2015,” he said.
Although the tender notice states that companies must provide alternative documents if they are not yet trading or have not been in business for a short period of time, amaBhungane’s analysis of BAS Med submissions shows that the company also failed to provide these documents.
Instead, financial data for the “four months ended June 15″ was sent to Lecholo’s work inbox on August 12, 2015.
Post time: Nov-13-2023