Former Municipal Manager out on R150 000 bail

In a recent development, the Molopo Magistrates’ Court has decided to postpone the case against Henny Smit, the former Municipality Manager of Mahikeng Local Municipality, until December 8, 2023. The decision comes in light of ongoing investigations into the involvement of other suspects. Smit, 70, was granted bail in the amount of R150,000, with stringent bail conditions that include refraining from interfering with state witnesses and promptly notifying the investigating officer of any travel outside the Gauteng jurisdiction, where he resides.

Smit’s arrest on October 10, 2023, by members of the Hawks’ Serious Corruption Investigation and Serious Commercial Crime Investigation Units sent shockwaves through the region. The arrest and subsequent court appearance are linked to allegations of the unlawful sale of municipal land with an estimated value of R144 million, executed without proper council approval and in disregard of the competitive bidding process.

It is alleged that Smit, in a controversial agreement dating back to October 31, 2007, facilitated the sale of municipal land to a company. However, the company made a mere R5 million deposit on the property and later went into liquidation in December 2011, leaving an outstanding debt owed to the municipality. Shockingly, the assets of the insolvent company were subsequently auctioned for R16 million. Even more concerning, the new owners of the land changed the company’s name in April 2012, and between 2013 and 2015, portions of the land were sold and transferred to five other companies and a trust account. Investigations by the Hawks unveiled disturbing links between the directors and shareholders of these companies and the liquidated entity, suggesting collusion to unlawfully profit from the irregularly acquired municipal land.

In a further twist to the complex case, the company that acquired the land at auction entered into an illicit agreement with the Social Housing Regulatory Authority (SHRA) to build 2400 units valued at over R301 million. Allegedly, an unauthorized sum of R54 million was sanctioned by the North West Department of Human Settlements to kickstart the project. However, this project ultimately failed to materialize due to a lack of budgetary provisions by SHRA. Additionally, investigations uncovered that over R550,000 in gratification was allegedly paid to one of the suspects, which was subsequently traced to the purchase of a house belonging to the accused’s daughter.

The charges stemming from this alleged series of offenses include fraud, theft, contravention of the Municipal Finance Management Act (MFMA), four counts under the Prevention and Combating of Corrupt Activities Act (PRECCA), two counts of corruption, money laundering, and contravention of the Public Finance Management Act (PFMA) regarding losses incurred by the Human Settlement Department. Authorities anticipate further arrests as the investigation continues to unfold.

Dr. Rachel Makhari, the Director of Public Prosecutions in the North West, and Major General Patrick Mbotho, Provincial Head for the Directorate for Priority Crime Investigation, commended their respective teams for their dedication to holding alleged perpetrators accountable for their actions. This case remains a critical focus in the ongoing fight against corruption, emphasizing the importance of upholding the law and safeguarding public resources.