An East London businessman alleges that Buffalo City Metro owes him almost R4-million for security work his company had done for the city.
Milisa Security won a two-year contract in 2005 and had it extended to 2011, but when it was not renewed director Theo Tonisi claims an outstanding R3.8-million was not paid.
However BCM yesterday disputed the claim.
BCM spokeswoman Bathandwa Diamond said Milisa Security had intended to institute legal action against the municipality in respect of unpaid invoices.
“There are two legal opinions – one internal and the other from an external legal service provider – which confirmed that BCM is not liable to the claim.
“In 2016 BCM wrote to Milisa Security’s attorneys advising that the claim is disputed and should any legal action be instituted, [the] same will be defended accordingly,” Diamond said.
She added there was no further communication or any legal action instituted by Milisa Security.
“There are no records at legal services of any agreement or undertaking which concede to the claim.”
Tonisi claimed he lost his house, personal and company cars, was declared bankrupt and had to sell all his assets because of the money he claims was owed to his business.
He says he paid more than R800000 in legal fees in his attempt to get his money, which yielded no results.
“I realised I was not going to get my money when my contract was terminated but all the other companies received their money from different departments,” Tonisi said yesterday.
“We were given 70% of the money and when I inquired whether it would be paid I was given the runaround. “I spoke to the former mayor and the former municipal manager about being paid and they told me that my money was not in that year’s budget.”
Milisa Security, which is based in Johannesburg but has an office in East London, had tendered for various municipalities in the Eastern Cape in previous years.
The contract, which employed almost 600 personnel, saw security guards at the East London City Hall, municipal offices and other major amenities in the city.
Tonisi said the case was dismissed by BCM officials and he had since been sending letters to the mayor Xola Pakati in an effort to have his money paid.
“I sent an e-mail last month to the mayor, who said he would follow up but I still have not heard anything,” Tonisi said.
“I was in serious trouble when I needed to face a hefty bill at SARS and had to sell more than four cars. I lost my house and my farm and now I find myself in a bad financial situation.”