City Press
*Anti-graft hero's feet of clay* *Chandre Prince, City Press, Johannesburg, 30 May 2010*Anti-corruption campaigner Moeletsi Mbeki failed to act against widespread financial misuse at a premier education NGO he chaired -- leaving more than 20 staff members unemployed and millions of donor funds "misused".
Mbeki, brother of former president Thabo Mbeki and internationally renowned as an independent thinker and commentator, was personally alerted to the misuse of funds involving millions of rands at the Open Learning Systems Education Trust (Olset).
Olset has provided learning material and training to thousands of primary school learners and teachers in the country for more than 17 years. It had to close its doors last November after its primary funder, the Dutch embassy, pulled out more than half of its R40 million funding due to financial irregularities at the NGO.
Documents in possession of City Press highlight a sequence of meetings and emails during which Mbeki, who has publicly lashed out at fraud and corruption, was alerted to several anomalies in the organisation since July 2008 but failed to act.
Olset director Gordon Naidoo, whom staff say ruled the organisation with an "iron fist", is a long time ally of Mbeki.
Mbeki did not respond to questions he had asked to be emailed to him. Naidoo refused to answer any of the questions emailed to him. Instead he sent a brief note explaining the organisation's business.
Olset's former deputy director and whistleblower Farhana Chand started asking critical questions two years ago, some addressed to Mbeki and Naidoo, regarding organisational and management policies and procedures, specifically about financial and operational issues.
These included Naidoo being the only signatory on Olset bank accounts; that no senior management or board meetings had been held between 2004 and last year; that Naidoo, in the absence of board meetings, had approved loans of about R800 000 to himself and that a company credit card was used for private expenses.
Chand, a long-serving Olset employee, was instead suspended in May last year, allegedly on Mbeki's instruction, for a range of what later proved to be spurious allegations.
One of the charges levelled against her was that of having unauthorised discussions with funders and not disclosing these to Naidoo or the Olset board. She was found not guilty on all charges and re-instated.
Following a sequence of events which included late payment of salaries, staff anxiety over Olset affairs and schools paying for undelivered learner radios, in mid- November Naidoo informed staff that the organisation was closing down.
During a meeting he cited as a reason for this that the Dutch were ending their funding due to the global economic crisis and that there was no money for salaries.
Deputy ambassador of the Royal Netherlands Embassy in Pretoria, Peter Mollema, said they withdrew almost R22 million in funding due to irregular spending at Olset, prompting a forensic audit.
"Our forensic audit found that money was not spent in accordance with the (funding) contract. There is something wrong (with Olset's) finances," he said.
Mollema said a report had been sent to their ministry in The Hague and they were awaiting instructions on possible action to recoup the "misused" monies.
"We are entering into legal discussions with Mr Naidoo. We may consider civil action," he said.
- City Press*From: http://www.citypress.co.za/SouthAfrica/News/Antigraft-heros-feet-of-clay-20100530*
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