Special Tribunal orders ex-Transnet exec, contractor to pay back R26.4m to SOE

Editor's note: The previous version of this article incorrectly stated that Robert Velosa was found personally liable for fraud and made to refund Transnet. It has since been corrected to reflect that Velosa was the representative of a company appointed a trustee for the Msagala Family Trust and Msagala Residence Trust, and was not personally liable in the matter. EWN sincerely regrets the error. 

JOHANNESBURG - The Special Tribunal has found former Transnet executive for Capital Projects, Herbert Msagala, guilty of disgorgement of secret profits while employed there and has ordered that he pay back R24.6 million to the SOE.

Judge Lebogang Modiba made the ruling on Tuesday in the fraud and corruption case against Msagala.

Msagala improperly earned secret profits from IGS Consulting Engineers (IGS), which at the time was a supplier contracted to Transnet.

IGS director, Sipho Sithole, was also ordered to jointly and severally refund the money to Transnet.

The Special Investigating Unit (SIU) has secured yet another milestone victory as it works to recoup money made by former and current state-owned companies' executives who benefited from corrupt and fraudulent dealings.

The (SIU) had applied to the Special Tribunal to recover monies earned improperly by Msagala from IGS Consulting Engineers.

Modiba has ordered Msagala in his capacity as trustee of the Msagala Family Trust and Msagala Residence Trust, and Sithole to jointly and separately refund Transnet.

Msagala was dismissed by Transnet following disciplinary processes after a lifestyle audit unearthed the millions he was receiving outside of his employ.

Last year, the Special Tribunal granted an order to preserve his pension benefits and declared his assets, which include two houses in Gauteng, two other houses and a farm in the Free State and 35 vehicles, forfeit to the state.