It took an Uber driver to lift the lid on corruption at Delta Property Fund — an act that has culminated in the company’s former CEO Sandile Nomvete declared delinquent and banned for life from holding directorship of companies in SA.
The JSE-listed property group’s former CFO Shaneel Maharaj and COO Otis Tshabalala, were banned for 15 and 7 years, respectively — handing victory to Delta, which sought the court to declare them delinquent.
Uber driver Philip Dube was the first to alert the Delta board of shoddy business dealing between the company’s board and an employee of the Bank of China (BOC). This was after Dube’s company, Striving Mind, was used as a front for underhanded dealings between Nomvete, Maharaj and senior BOC official — Alfred Van Wyk — the relationship manager between the lender and Delta.
The transaction is centred on the rolling over of a loan which originated with Nedbank but was bought by BOC. It was for the sum of R200m. While BOC became the new lender, Nedbank remained as a “facility agent”, thus retaining a role in future negotiations regarding the extension or the repayment of the loan.
The loan was not repaid on the repayment date, resulting in five extensions — with each extension occasioned by an “addendum”, which would cover any new terms, including the new settlement date. Two of the five extensions secured from BOC implicate Nomvete and Maharaj in unlawful conduct.
On one occasion, Van Wyk informed Nedbank that Delta’s facility would not be extended, as BOC was promised that the loan would be repaid upon expiry of the extended date. This stance saw Nomvete and Maharaj meeting with Van Wyk at Delta’s offices. It is at this meeting that the relationship between Delta’s top executives and Van Wyk became murky.
According to evidence, Van Wyk told Nomvete and Maharaj that in addition to his employment duties, he was privately engaging in the business of assisting with and facilitating loans and bank facilities during his personal time and that he was doing so in a separate capacity and not as a representative of the BOC.
He invited Nomvete and Maharaj to engage him in this capacity and told them that if they did so he would charge Delta a fee calculated at 0.1% per month for each of the months that the loan was extended.
The three then came to an agreement. The loan was then extended for three months, an event which was preceded by Van Wyk sending Delta a R600,000 invoice in Striving Mind’s name — an invoice Maharaj approved and processed for payment.
However, the transaction was masked as payment to the National Education, Health & Allied Workers’ Union on Delta’s books. On the fifth extension, the relationship between Nomvete, Maharaj and Van Wyk became more corrupt.
On this occasion, BOC again indicated its unwillingness to extend the loan any longer. Van Wyk reappeared in his “private capacity” and offered to arrange for the extension — this time for a fee equal to 1.5% of the value of the successfully raised payment for Delta.
Maharaj then dispatched a letter to Dube confirming the appointment of Striving Mind — despite Delta not having engaged Dube, the sole director of Striving Mind at any stage.
Two months after this letter, Van Wyk, using his official BOC email, sent a message to Delta informing it that the bank had decided to grant the extension of the R100m loan for three months and R100m refinancing for three years.
Van Wyk then, using his private email, wrote to Maharaj providing an invoice of R1.5m under the name of an outfit called Mazaleni Projects — despite Delta having “appointed” Striving Mind. The payment for this invoice was approved by Nomvete and Maharaj.
The probe into the BOC transaction, led investigators to further evidence of financial mismanagement at the top echelons of Delta.
Another transaction that raised eyebrows was one in which Delta contracted two entities Mhlandla and Zimzin to negotiate a renewal of 59 lease agreements with the department of public works.
The Delta board was kept in the dark about the mandate agreements, but was instead made to believe that it was Nomvete and Tshabalala who were negotiating with the department over the renewals.
A total of 37 leases were concluded between Delta and the department in 2018-19 with 31 of them concluded outside the mandate period given to Mhlandla and Zimzin.
For its efforts, Mhlandla was paid R23m while Zimzin was paid R3.6m. The mandate and payments were made despite neither Mhlandla nor Zimzin being in possession of a fidelity fund certificate entitling them to earn a commission.
Evidence shows Nomvete personally benefited from the transactions.
Mhlandla paid R300,000 to an entity he is a sole director of, Mesismart. His explanation to Mazars investigators was that the payment was made on behalf of Mhlandla’s representative for a trip to Uganda on Nomvete’s private jet.
One of Nomvete’s companies, Dariobex, had Mhlandla’s sole director on its payroll, investigators found.
The company in which Nomvete and his wife are directors, Shameless Way, which provides private chartered flights to clients, benefited R863,000 for three trips undertaken by Nomvete and other staff of Delta. The transactions were done against the company’s travel policy which dictates that the use of personal aircraft by any employee could only be undertaken if an employee had obtained two comparative quotes from commercial airlines.
Delta in December 2020 informed the market that a forensic investigation found evidence of past practices involving governance failings and wrongdoing at the company, “including unsubstantiated payments, procurement irregularities and other unethical business dealings”.
The report has never been made public. Nomvete did not respond to questions, while Maharaj and Tshabalala could not be reached for comment.
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