A former Mahikeng Municipal Manager is out on bail after he was arrested for corruption and fraud.

The 70-year-old Hennie Smit allegedly sold municipal land valued at R144 million without council approval and further ignored the bidding process. North West National Prosecution Authority spokesperson, Henry Mamothame, said Smit got bail of R150,000 in the Molopo Magistrate’s Court on Tuesday (10/10) with strict bail conditions. He was arrested by the Hawks earlier that day.

Mamothame said the case against Smith was postponed to 8 December 2023 as more arrests are expected. The magistrate ordered him not to interfere with witnesses and he also had to inform the investigating officer if he wanted to travel outside the Gauteng jurisdiction, where he resided.

"It is alleged that on 31 October 2007, Smith illegally agreed with a company for the sale of land belonging to the municipality. The said company only paid R5 million as a deposit to purchase the land. Investigations reveal that the company went into liquidation in December 2011 without paying the municipality the outstanding debt. The assets of this company were subsequently sold to another company for an amount of R16 million at an auction.

"In April 2012, the new owners of the land changed their company name, and between 2013 and 2015 they sold and transferred portions of the land to five other companies and a trust account. Investigations by the Hawks revealed that directors and shareholders of these companies had links to the company that was liquidated and they acted in common interest in illegally making gains from the municipal land that was acquired irregularly."

Hennie Smit is former Municipal Manager in Mahikeng. The 70yr old appeared in court for fraudulently selling municipal land for R144m. He gave municipality R5m only. pic.twitter.com/b4OXMkErQL

— Bra Hloni (@BraHlonisky) October 11, 2023

Reports by the Hawks also indicate that the company which bought the land from the auction, entered into an unlawful agreement with the Social Housing Regulatory Authority (SHRA), to build 2 400 units at a value of over R301 million. An amount of R54 million was allegedly authorised by the North West Department of Human Settlements for the start of the project. This contract, however, failed to materialise, as it was not budgeted for by SHRA. Investigations also revealed that an amount of over R550,000 was paid as gratification to one suspect and it was traced to the purchase of a house for the daughter of the accused.

The suspect is facing charges of fraud, theft, contravention of the Municipal Finance Management Act (MFMA), four of the Prevention and Combating of Corruption Activities Act (PRECCA), two of corruption, money laundering, contravention of the Public Finance Management Act (PMFA) regarding the loss suffered by the Human Settlements Department. 

More arrests are expected and investigations have been completed.

The Acting Premier in the province, Nono Maloyi, recently vowed to fight corruption following the arrests of several government officials. He said there would be no hiding place for criminals in North West.

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