Future of KZN Growth Fund chair hangs in the balance

The KZN Growth Fund board is expected to make a decision on the arrest of its chairperson Silas Hlophe. Picture: File

The KZN Growth Fund board is expected to make a decision on the arrest of its chairperson Silas Hlophe. Picture: File

Published Jun 28, 2023

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Durban — Silas Hlophe's grip on his position as chairperson of the KwaZulu-Natal Growth Fund Trust seems to be hanging in the balance, with the entity announcing that it is assessing the implications of his arrest.

Hlophe, who was appointed as uMhlathuze Water Board deputy chairperson in 2018, has been fingered in the R37 million tender scandal and appeared in the Durban Specialised Commercial Crime Court on charges of corruption last week. He was freed on R10 000 bail.

Reacting to the arrest, the fund said: “Regarding the implication of Mr Silas Hlophe in the ongoing Mhlathuze Water Board corruption case for the contravention of the Public Finance Management Act, the KwaZulu-Natal Growth Fund Trust (KGFT) is yet to conclude its internal deliberations on the broader implications of this matter, and will offer a comment in due course.”

Hlophe was arrested by the Hawks’ National Clean Audit Task Team on Friday last week and appeared in court on the same day alongside five other suspects – Siyabonga Bhengu, Nofezile Mhlanga, Maria Gevers, Amita Abdul and Duduzile Chiliza.

The five were granted bail of R5 000 to R10 000 and are due to return to court on Thursday.

They face charges of fraud, money laundering and defeating the ends of justice. The latest arrest brought the total number of accused charged in connection with the matter to 14.

According to the State, the six accused, together with eight others, improperly benefited from a legal services tender issued to probe irregular expenditures at the entity from 2017 to 2018. Hlophe was appointed as deputy chairperson of the uMhlathuze Water Board in 2018.

According to media reports, Badul and Gevers allegedly disclosed confidential information from a forensic investigation into the corruption to former Mhlathuze Water Board CEO Mthokozisi Duze and former CFO Babongile Myandu, who are also facing charges in connection with the matter.

Duze and Mnyandu are alleged to have irregularly appointed a law firm owned by Ralph Mhlanga, who is also charged in the matter.

Nofezile Mhlanga, the wife of Ralph Mhlanga, is charged with money laundering amounting to R18m.

The money was allegedly paid by the water board to her company, NCD Investments, and used to build her family mansion in northern KwaZulu-Natal. Bhengu is an architect who is said to have built a luxury home for the Mhlanga couple.

He allegedly instructed his employees not to co-operate with investigators probing corruption at the water board.

It is alleged that Duze and Mnyandu coerced their employees to approve irregular payments amounting to more than R30m to Ralph Mhlanga.

Hlophe is expected to lead his board members in a court battle with dairy product company Goodlife, which took the growth fund to court over the cancellation of funding of R72m it had already approved for the business. The dairy firm’s owner, Busi Gumede, believes her funding was withheld because she refused a meeting with a board member she believed wanted to solicit bribes for funding her business.

Economic Development, Tourism and Environmental Affairs was yet to comment on the matter at the time of publication.

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