Rampant fraud at Mandela school fleeces millions from donors

Theft and mismanagement of funds has marred the Mandela School of Science and Technology as a forensic report fingered the principal and his management team of misusing funds received from German electronic company Siemens. A forensic report by Open Water Advanced Risk Solutions revealed shocking details of how claims were misrepresented and manipulated after Siemens (Pty) Ltd, the Royal House of Mandela and funders Siemens Stiftung mandated a probe into allegations of misappropriation of funds. The R100-million school was the result of Siemens making a commitment in 2010 to Nelson Mandela to support the building of a school in the...
Theft and mismanagement of funds has marred the Mandela School of Science and Technology as a forensic report fingered the principal and his management team of misusing funds received from German electronic company Siemens.

A forensic report by Open Water Advanced Risk Solutions revealed shocking details of how claims were misrepresented and manipulated after Siemens (Pty) Ltd, the Royal House of Mandela and funders Siemens Stiftung mandated a probe into allegations of misappropriation of funds.

The R100-million school was the result of Siemens making a commitment in 2010 to Nelson Mandela to support the building of a school in the village of Mvezo, Eastern Cape, fulfilling the lifelong dream of Nkosi Dalibhunga Mandela, whose birthplace is Mvezo.

It now appears that those running the school have left its finances in tatters and manipulated their funder Siemens Stiftung into paying out money for their own benefit.

The school was found to have had poor financial records as it did not perform bank reconciliations. Funds received from sponsors were all deposited into one account, making it difficult to ensure specific funds received were used for their intended purpose.

The report found that at least 66,000 Euros (R1.046,175) received from Siemens Stiftung was misused with some ending up in the pockets of the principal, his bookkeeper and some SGB members.

The misrepresented claims

The report recommended criminal charges be laid against the bookkeeper as she unduly allocated funds to herself, submitted misrepresented claims in respect of tutors to the school, purportedly spent funds on groceries and stationery, and manipulated supporting documents to mislead Siemens Stiftung and the education department.

The school misrepresented their expenses and claims submitted to Siemens Stiftung which amounted to more than R640,000 for teaching, administration, catering and stationery which were found to not be spent in terms of the funding agreement budget items.

For the July 2018 winter school, an expenditure spreadsheet stamped and signed by the principal reflected an incurred expense of R165,122.91 on items relating to the budget submitted to the funder.

It listed the rates of several teachers including the principal for the hours incurred for teaching during the winter school programme. However, 13 teachers revealed that they, in fact, received far less than what was claimed, while the bookkeeper informed them "that the school did not have sufficient funds, blaming Siemens Stiftung for the shortfall," the report found.

During the same winter school programme, the bookkeeper allegedly paid herself R15,000 for administration duties, cleaning, and cooking.

Payment documentation submitted to Siemens Stiftung were apparently duplicated, while expenditure claims were already submitted to the department of education.

"Teachers were requested to complete claim forms for rendering teaching services in advance without inserting the claim amounts, allowing for the claims to be manipulated by the bookkeeper. In this regard we established that the amounts reported to Siemens Stiftung were inflated with lesser amounts paid to teachers," said the report.

Claims were submitted and subsequently paid for excessive amounts for travel by the principal and three other teachers.

This included a R12,000 claim submitted for stationery, but the service provider disclosed that even though they provide stationery to the school and service their photocopy machine, they were not yet paid for the service.

For the 2018 Spring School, the principal and the three teachers collectively submitted travel claims totalling more than R48, 000 whereas transport funds were budgeted at R4,550.

The bookkeeper again allocated R15,000 to herself, but according to the budget breakdown, she was listed as having received R2,100.

Payment was also made to the principal for teaching physics during the Spring School but it was found he did not teach at all.

Cashing in on extra classes

In 2019, the principal introduced Orientation Week for Grade 7 and Grade 12 learners to fast track syllabus and extra classes for critical subjects, outside of the funding agreement with the funder.

In addition, the breakdown budget the school submitted to Siemens Stiftung was incorrectly calculated as R147,000 when in fact, the correct total amount was R99,550. The funder, however, transferred R93,000.

Claims submitted for teachers working during Orientation week exceeded the budget while the practice of underpaying teachers and blaming this on the the funders allegedly continued. The principal also allegedly claimed payment for teaching, as well as submitting claims for teachers who did not participate.

Claims for this amounted to R31,500, while a further R70,000 was claimed for weekend classes, on behalf of teachers who did not participate.

"In conclusion, the school did not utilise funds aggregating R114,400 for Weekend Classes which were misrepresented when reporting back to Siemens Stiftung," the report reads.

The report also found that the bookkeeper submitted fraudulent claims in the names of five cooks for these weekend classes, as well as R11,700 for transport costs.

Fish rotting from the head

Again, during the 2019 autumn school classes, the principal was found to have allocated funds to himself four times the other teachers', an amount he said he did not recall as he disputed signing and completing the claim form.

When the 2019 winter school programme came around, the bookkeeper submitted claim forms with cheque numbers for payments made to teachers who participated, but the forensic investigation found that the cheques were either cancelled, not drawn, or issued as payment other than as indicated.

Members of the school governing body were also implicated in the probe as the chairperson was found to have been paid R154 000 which could not be accounted for while the treasurers were found to have signed cheques without supporting documents.

Need for criminal charges/\r\n/
It was recommended that Siemens, the Royal House of Mandela and Siemens Stiftung take disciplinary action against the principal and SGB members, and that the bookkeeper should be criminally charged.

"The conduct of [the bookkeeper] may have met the elements of the crime, fraud and theft and the funders should consider registering a case at the South Africa Police Service," the report found.

Siemens Stiftung together with Siemens were reviewing the report and seeking legal advice on the necessary steps, the company told The Citizen.

"Siemens has zero tolerance towards corruption, unethical behaviour and other breaches of law which are clearly articulated in our business conduct guidelines. Siemens' ongoing involvement and contribution to the school was to uplift and enhance the focus on education, specifically in the fields of engineering, science and technology."

The forensic findings have also landed at the office of the Public Protector, who confirmed they were still assessing the merits of the complaint lodged.

"The complaint was received. It is currently undergoing a standard process of assessment to establish if it has merit and falls within our jurisdiction. Only after this process will the Public Protector be in a position to decide whether or not to investigate," said spokesperson Oupa Segalwe.

Numerous attempts to obtain comment from the school and principal on the charges levelled against them were unsuccessful.

rorisangk@citizen.co.za

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