Hennie Smit, a former Mahikeng municipal manager who is alleged to have been involved in the fraudulent sale of municipal land valued at R144 million in 2007, made a court appearance on Tuesday. Smit was apprehended by the Hawks’ serious corruption investigation and serious commercial crime investigation units on 10 October 2023, and he was granted R150,000 bail.
“His arrest and court appearance relate to the unlawful sale of municipal land to the value of R144m without council approval and further ignoring the competitive bidding process,” said National Prosecuting Authority spokesperson Henry Mamothame.
Allegedly, in October 2007, Smit entered into an unlawful agreement with a company for the sale of municipal land. This company provided a R5 million deposit. However, the company went into liquidation in December 2011 without settling the outstanding debt. Subsequently, the assets of the company were auctioned off to another company for R16 million.
In April 2012, the new owners of the land changed their company name. Between 2013 and 2015, they further divided and transferred portions of the land to five additional 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,” Mamothame said.
It is further alleged that the company which acquired the land from the auction engaged in an illicit agreement with the Social Housing Regulatory Authority (SHRA) to construct 2,400 units, with a total value exceeding R301 million. The North West department of human settlements provided authorization and allocated R54 million to initiate the project.
“This contract, however, failed to materialise, as it was not budgeted for by SHRA.”
Mamothame said Smit faces a number of counts including fraud, theft, corruption, money laundering and contravention of the Municipal Finance Management and the Public Finance Management acts.
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