The department of social development will be investigating cases of internal fraud after a preliminary report into non-profit organisations funded by the department revealed scathing evidence against the department’s own employees.
This was likely to see implicated employees facing possible criminal charges, said MEC Phumza Dyantyi in an exclusive interview on Wednesday about the much-publicised delays in payments to NPOs.
Dyantyi revealed that the report found that 266 of the department’s employees had not declared that they were also employed by the NPOs, or were board members of NPOs which received funding, resulting in a conflict of interest.
Dyantyi also revealed that the bank account numbers used by certain NPOs in the province were identical to the bank accounts of employees who were registered on the department’s Persal salary system.
Only government employees have Persal numbers.
Furthermore, some employees’ banking details were found to match bank accounts registered for Sassa grants.
Dyantyi said after noticing fraudulent practices in funds transferred to NPO’s, the department, together with treasury, conducted a forensic investigation to “reduce risks and vulnerabilities in the disbursed funding to NPO’s”.
“Preliminary results from the forensic investigation are already showing several worrying trends.
“The department is attending to that by improving its systems to ensure we tighten the system,” she said.
She said the employees would now have to motivate why they must not be criminally charged.
“The department is now seized with the task of finalising outstanding details of the preliminary report with treasury.
“Once that is complete, the department will commence with the consequence management process, which involves charging implicated employees.”
Dyantyi said this was part of the department’s interventions to improve the management of NPO’s in the province.
Commenting on the late payments to NPO’s for the 2018-19 financial year, social development HOD Ntombi Baart said the department had worked to process payments for current beneficiaries which were still outstanding, and 70% of those had been paid already.
“We are hoping that by the end of the month all outstanding NPOs will have been paid.”
However, she said NPO’s were quick to complain about not receiving funding, without having supplied the information required by the department.
“Sometimes the NPOs are not telling the truth because they also change bank accounts, which causes problems for payment.
“When we engage with the NPO to ask them if they reported their problems, you find that they haven’t.
“When you follow this up, you find that they don’t comply with the department’s requirements.”
She said the preliminary treasury investigation found that:
Some NPOs were sharing banking details, while others were found to have registered one ID number under different names, as well as invalid ID numbers;
A number of Sassa beneficiaries’ bank accounts were the same as certain NPOs’ bank accounts;
In six instances, NPOs which had service level agreements with the department did not do the work but got paid R1.1m;
The department’s own account number was being used by certain NPOs, which the MEC said was surprising and this mystery was still being investigated;
Some NPOs were receiving more than one funding grant;
Foreign nationals were found to be among the South Africans who were unlawfully operating NPOs or receiving Sassa grants.
Baart said these findings would also be investigated before the end of the current financial year on March 31.
“We are going to start looking at these because the term is coming to an end and we have to monitor these.”..