Forensic investigation confirms fraudulent and other irregularities at Property Practitioners Regulatory Authority.

Among the findings – people ‘not fit and proper’ for the job being appointed to critical positions and paid excessive salaries.

Further senior managers and junior staff at the Property Practitioners Regulatory Authority (PPRA) are set to be suspended this week, following the finalisation of a forensic investigation that confirmed fraudulent and other irregularities were committed by suspended CEO Mamodupi Mohlala.
PPRA chair Steven Ngubeni confirmed this on Wednesday, adding that the forensic investigation was completed on 23 August and not only implicated Mahlala but also a number of staff members.
He said none of the managers and staff implicated have been suspended yet.

Ngubeni said the PPRA was required to first inform Minister of Human Settlements Mmamoloko Kubayi, which the regulator has now done.
“We have received a response from the minister to say she notes the findings of the forensic report and she encourages the board to act on all the findings contained in the forensic [investigation] and to pursue its own recommendations to the minister. That is to suspend people who are implicated and charge people who are implicated and to [refer] criminal charges against some of the people who are implicated.
“That is the process that we are yet to begin with during the course of this week,” he said.
Ngubeni declined to mention the names of the managers and staff implicated because they have not yet been formally notified of the findings of the forensic investigation and the implications of these findings for them.

The allegations
PPRA board member Pamela Makhubela said the board has decided to refer criminal allegations, including but not limited to fraudulent activities, to the law enforcement agency.
Makhubela said the allegations against Mohlala in essence cover:
• Contraventions of pension fund legislation and rules;
• Irregular appointments of staff and the appointment of under-qualified persons;
• Flouting of procurement processes leading to irregular, fruitless and wasteful expenditure; and • Fraud.
Makhubela said the board has to date laid charges against Mohlala and the disciplinary hearing against her commenced before she indicated that she had referred the matter to the Commission for Conciliation, Mediation and Arbitration (CCMA) for hearing.
She said the CCMA is scheduled to hear the matter from 26 October 2022.

“The board is also taking legal advice on the [forensic] report and referring the criminal aspects to the law enforcement agencies and to recoup the financial losses from the implicated Individuals,” she said.
Ngubeni said Mohlala has declined to provide any answers to the allegations that were levelled against her. Makhubela added that the final forensic report clearly illustrates the role of Mohlala in the failure to ensure that the pension funds contributions were collected and paid over to the pension fund and that she instructed that the pension funds contributions must not be made, resulting in a loss being incurred by the PPRA.
The PPRA is now faced with fruitless and wasteful expenditure for this “outright dereliction of duty” by Mohlala, she said.

Jobs for friends
Makhubela said the appointment of individuals to positions that were not on the PPRA’s organisational structure and not included in the approved budget was signed off by Mohlala and “are irregular appointments”.
“Staff members were appointed to positions without having the required minimum skills and qualifications. Some of the individuals not fit and proper to be considered for appointment were to the contrary appointed to critical positions within the PPRA, for example the supply chain management (SCM).
“This is quite concerning in the background of corruption,” she said.
Makhubela said the human resources department is the custodian of employee files, but alleged files were removed “at the behest of the suspended CEO and to date cannot be traced in the PPRA premises”.
“Some of these [missing] files involve the HR files of staff members implicated for flouting of procurement processes or for irregular appointments,” she added.
“There is to date a lack of documentary evidence to verify that the recruitment and selection process was followed during the appointments of key positions approved by the suspended CEO.”

‘Excessive salaries’
Makhubela said the PPRA incurred a loss due to the misrepresentation of qualifications and paid excessive salaries to undeserving individuals but will recover this loss from the individuals involved in these misrepresentations.
She said the final forensic investigation report also highlighted “a discomforting arrangement” in regard to supply chain management, which was instructed to report directly to Mohlala instead of the chief financial officer, in contravention of the requirements of the Public Finance Management Act.
Makhubela said this arrangement laid fertile ground for disregarding the supply chain management processes, resulting in them being flouted in a number of key instances.
This included a number of issues related to a visit by a Namibian delegation, including:
• The catering service provider was not vetted for tax or BEE compliance;
• The delegation’s visit was for two days, 15 and 16 March 2022, but the catering supplier’s invoice was made out for three days;
• A maximum of 40 people were catered for but the invoice was issued for 120 people; and
• Mohlala allegedly ignored queries from the PPRA finance department about the number of people who were catered for and allegedly gave instructions that the invoice for 120 people be paid in favour of the supplier. Irregularities related to the procurement of 1 000 study guides were that:
• No record of delivery was established;
• The supply chain management officer signed off the delivery without verifying the number of study guides received;
• A reconciliation of the study guides found that almost 1 206 study guides cannot be accounted for, but the supply chain management officer signed and instructed the finance department to make payment for 50% of the amount payable (R401 000), which was signed off by Mohlala; and
• There is an element of fraud and collusion on the part of the supply chain management officer and the supplier.

The forensic report also investigated the procurement of services for Rural Brand Technologies to assist with the development of the PPRA At-Your–Fingertips app, which was intended to facilitate applications and the issuing of Fidelity Fund Certificates (FFCs) via the PPRA’s system.
It found that:
• Rural Brand issued invoices before the app was handed over to the PPRA;
• The app is not functioning but the invoices were signed off by the manager and chief risk officer, which are not the user departments for the app, and without verifying whether the app was functioning.
• Mohlala allegedly approved the payment of R495 000 despite her not having the required approval authority because the amount exceeded the budgeted amount and the app was not functioning; and
• The procurement of Rural Brand was supposed to be by means of an unsolicited bid process, which required National Treasury approval. National Treasury approval was allegedly forged and the manager responsible for this has allegedly admitted to the forgery and confessed to the fraud.

Source : By Roy Cokayne: regulator-to-besuspended-charged/

Question 1 (25 Marks)

With reference to the case study:
Suggest a researchable title, identify and state the research problems. (15 Marks)
Formulate FIVE (5) objectives and FIVE (5) research questions. (10 Marks)

Question 2 (25 Marks)

Discuss the data collection and analysis process you would follow according to the research questions provided in order to achieve the objectives of the study.

Question 3 (25 Marks)
Based on the information provided in the case study, write FOUR (4) paragraphs of literature review using recent sources relevant to the topic.

Question 4 (25 Marks)
With reference to case study, critically evaluate the importance of following the ethical principles and the approach you will use to conduct ethical research.

Answers to Above Questions on Research Methodology

Answer 1: An approprouate research title based on the above case study is” An emprical analysis on fradulent activities at Property Practitioners Regulatory Authority and their implication on corporate governance”. The specific research problems in respect to the above topic are:

  1. To analyse the ways in which fradulent activities were carried out at Property Practitioners Regulatory Authority


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