'Corrupt' SAA Technical execs must pay up R5m – Numsa

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Cape Town – Senior South African Airways Technical (SAAT) executives must pay damages of R5m, relating to an irregular transaction, the National Union of Metalworkers of South Africa (Numsa) said on Sunday.

The transaction relates to the 2016 sale of 12 Ground Power Units (GPU’s) from SAAT, which maintains and services the fleets of the national airline as well as several other carriers, to JM Aviation.

“It is our firm belief that the sale was induced by corruption or bribery involving senior SAAT employees who may have colluded with executives from JM Aviation to effect the sale.”

Numsa said it believes the decision to sell the GPUs, which was far below the market value, was strictly for the financial benefit of JM Aviation at the expense of SAAT.

Numsa said this allegation is based on the findings of the Open Water Forensic report, which it said confirmed that the sale of the GPU’s was irregular and that proper supply chain management policies were not followed. It also found that the sale exposed SAAT to “undue financial obligations”.

“Open Water found that SAAT suffered a loss of at least R5 128 687. We therefore demand that those identified in the Open Water Report for this irregular transaction are liable to SAAT for the amount of R5 128 687.”

In 2015 SAAT purchased 12 GPU’s for R11m, including shipping costs, with each GPU costing R800 000, said Numsa.

“In July 2016 SAAT then sold the GPU’s for R2 976 000, at a cost of R248 000 per unit. At the time of the sale each GPU was worth at least R750 000, and its book value according to the SAAT register was R682 000.”

Numsa said the purchase of these GPU’s was irregular in that the person responsible for the SAAT asset register had not approved the disposal of all the GPU’s, the disposal was in contravention of Treasury regulations 16A7.1 which stipulates that the disposal and sale of assets must be at market related value and after JM Aviation bought the GPU’s, they went on to sell them to Swissport.

“SAAT now leases the very same GPU’s from Swissport at a rate of R550 per hour demonstrating that the transaction was purely motivated by greed and corruption,” said Numsa.

The trade union has sent a letter of demand to SAAT that it must begin legal proceedings against senior executives at SAAT, to claim damages from them for the role they played in the sale of the GPU’s.

“If it fails to do so, Numsa will approach the High Court for an order in terms of section 165 (5) of the Companies Act which will give the trade union the right to take legal steps to recover this money on their behalf.”

It claimed that the irregular sale of the GPU’s is but one of the many examples of corruption at SAAT which the Open Water Forensic Report exposed.

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