SITA probe drags on

By Nicola Mawson for SITA
Johannesburg, 08 Mar 2007

An investigation into alleged tender irregularities at the State IT Agency (SITA) is still ongoing, despite hopes of a report by last November.

CEO Mavuso Msimang, who recently announced he would be stepping down from the organisation, says it is not likely the investigation will be concluded soon. "The bottom line is that we are not hopeful that it will be finished soon, but it has to happen."

SITA's 2006 annual report cites irregular expenditure of over R130 million relating to five contracts, which include Gateway, CabEnet, its turnaround strategy and the firm's establishment of an ombudsman's office, all of which have been reported by the company for the past three years. Msimang has said these amounts were flagged as expenditure incurred without following proper procedures.

Audit ordered in 2004

Msimang said, after his appointment as CEO in October 2003, he noticed the discrepancies and ordered an independent internal forensic audit at the beginning of 2004. Parties involved in the transaction, but outside of SITA, were sent letters requesting answers regarding the fruitless expenditure.

However, he says he did not have "much joy", and - as a result - consulted with senior counsel, which said the wastage should be recoverable. However, the legal opinion recommended a civil case be undertaken through the auspices of the Department of Trade and Industry (DTI), which started the external investigation in June last year.

This morning, he said the organisation was still trying to recover misappropriated money and collect further information, which could lead to further investigations. So far, the department has been provided with all the information that it asked for, he says. "We are totally in the DTI's hands."

Msimang adds he would "love" to see the investigation concluded before he steps down as CEO. Late last month, the organisation said Msimang would step down as soon as his replacement was announced.