It seems that some dodgy operators in Limpopo municipalities have come up with a new scam to make money – secretly “borrowing” municipal money to earn interest on it. The Citizen can report that police in Limpopo are investigating allegations of fraud in the Ephraim Magale Local Municipality in the Sekuhune Region. According to reports, a senior official from the municipality allegedly deposited 134,000 rand into an account belonging to a person who is not on the municipal payroll and does not do business with the council. READ ALSO: Fraud allegations rock Sehuhune municipality amid agency probe. The transfer took place on May 6. Later…
It seems that some dodgy operators in Limpopo municipalities have come up with a new scam to make money – secretly “borrowing” municipal money to earn interest on it.
Citizen can reveal that police in Limpopo are investigating allegations of fraud in the Ephraim Magale Local Municipality in the Sekuhune Region.
According to reports, a senior official from the municipality allegedly deposited 134,000 rand into an account belonging to a person who is not on the municipal payroll and does not do business with the council.
READ ALSO: Fraud allegations rock Sekukhune municipality amid agency probe
The transfer took place on May 6.
Later on the same day, the same amount of money was withdrawn at the Nedbank branch in the Marble Hall.
But surprisingly, after a few months, on July 12, the same amount was received again in the municipal account.
Employees of the accounting department of the institution allegedly realized this trend and opened a fraud case at the local police department.
Attempts to get a comment from the municipality were unsuccessful, as both the municipality’s press secretary and the municipal manager avoided calls for two weeks.
But well-informed sources said there were suspicions that senior politicians and senior municipal echelons formed a cartel, working in collusion with accountants in finance departments to defraud their councils through the scheme.
A source familiar with the investigation said: “The scam works like this: a municipal official who has access to municipal transactions transfers any amount of money to his account or an account belonging to his partners in crime, especially shortly after the salary is paid.
READ MORE: More than 18 million rand disappears from the accounts of Sehuhune District Municipality
“The money will be transferred back to the municipality’s account in a few months. The depositor will then claim the interest accrued while the money was in their account.
“It’s like a stokvel or moneylending scheme where these fraudsters make money at the expense of payers.”
The Secretary General of the Bolshevik Party of the South African Republic, Seun Makgotji, said that this was not an isolated case.
He said many such incidents have occurred in the past in several municipalities, without police being reported or action being taken.
“This municipality should be put under management. First it was millions of rand illegally deposited into VBS Mutual Bank, now it’s nonsense.
“We want to act now, and those responsible need to be shown the door.”
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