Download - Historical Review
Special Investigating Unit
Presentation to Parliament 17 June 2004
Willie Hofmeyr Head
Historical ReviewHistorical Review1995 – Heath Commission established by
E Cape government – headed by former Judge Heath1996 – became a national body ito SIU Act
74/1996 1997 – first SIU set up by Proc R24 2001 – 1 August: New SIU set up by Proc R118 - Head Willie Hofmeyr
Historical Review (cont.)Historical Review (cont.)
Vision• To be a world class anti-corruption agency
Mission• An anti-corruption agency that performs high
quality investigations of corruption and takes legal action to prevent and recover losses of state assets in the public interest
About the SIUAbout the SIU SIU is a Schedule 3A Public Entity Established by the President and reports to
him and ParliamentEmploys a multi-disciplinary approachInvestigations aim to establish whether civil
liability existsSIU refers any criminal conduct uncovered
by investigations to prosecution authority
SIU mandate & legal scopeSIU mandate & legal scopeMain purpose of SIU is to investigate
corruption and serious maladministration in connection with the administration of state institutions, state assets and public money
Has limited mandate to investigate private sector conduct “which may seriously harm the interests of the public”
Cases are referred to the SIU by the President by proclamation
Adopting a civil law approachAdopting a civil law approachSIU only institution that uses normal civil
law to recover money (AFU has a special law)
Can investigate criminal matter and institute civil proceedings at same time
Corruption does not always amount to criminal conduct
In civil law only need to prove case on balance of probabilities
In civil law a negligent or even innocent misrepresentation is sufficient
Adopting a civil law approach Adopting a civil law approach (cont.)(cont.)Can still take profit out of crime even if
cannot prove corruption or fraudSIU mandate differs from other agencies
such as SAPS & DSOIn multi-agency task teams SIU
complements other agencies’ functions- DSO, SAPS, AFU
Delivering an effective and Delivering an effective and efficient service efficient service SIU has skilled and experienced forensic
auditors, commercial investigators, financial analysts, former prosecutors, attorneys and advocates
Provides forensic investigation services at no additional cost to departments
Able to do complete investigation and civil recovery, and assist in criminal prosecution or disciplinary inquiry
Delivering an effective and Delivering an effective and efficient service (cont.)efficient service (cont.)Private investigations generate a report
referred to SAPS to obtain proper evidence, leading to delays
Can match almost all private sector services at about half the cost
SIU assistance with the investigation and prosecution of the criminal matter can assist with the resource constraints in the criminal justice system
PartnershipsPartnershipsA major innovation has been to work
together with departments that have identified major maladministration or corruption problems
They have agreed to pay for the investigation – enables us to put dedicated resources at their disposal
Eg Correctional Services after Jali Commission
Justice – after AG reports This has a number of advantages for those
departments
• The costs are less than half of private sector• Effective forensic investigations that produce
court ready dockets • Recover losses and secure savings through civil
litigation• Assist with disciplinary inquiries• Assist with prosecutions• Provide ongoing advice to ensure systemic
improvements• The objectivity of the investigation• Also smaller projects with: DoT (Limpopo),
Housing (KZN and national) • Far advanced with NDoT, ECP Municipalities
Partnerships (cont)Partnerships (cont)
Report on progress of SIU Report on progress of SIU 10-point plan10-point plan
SIU commenced with 10 point strategy in 2002 to put the SIU “back in business” as one of the premier corruption fighting institutions in our country
Significant progress has been made in implementing this strategy
1. 1. Creating certainty aboutCreating certainty about the future of the SIUthe future of the SIU
Uncertainty no longer affecting staff moraleIn past two years, very few resignationsMany members who previously resigned
due to uncertainty returned to UnitStill a need to address long term certainty
2. New cases for SIU2. New cases for SIUDemand for SIU services greater than everIn fact, more than we can cope – may have
to turn away some unless able to pay18 ongoing investigationsFinalised 10 matters through closure or
referral for prosecution or other actionInitiated 6 new investigations
3. 3. Growing capacity to fightGrowing capacity to fight corruptioncorruptionStaff increased by 57% (121 to 190) Mainly because of significant additional
funding from departments – now nearly 31% of budget
Staff may increase by 60% this year to about 300
Received 35% increase in budget this yearAnd further funding from departmentsRecruited auditors, financial analysts,
attorneys, former prosecutors, experienced investigators
Training department established, and donor assistance
Start own trainee investigators programme – to improve capacity and representivity
Also a proper Performance Development Programme, and Potential Leadership Programme
Established an Internal Integrity Division to ensure highest level internal integrity
3. 3. Growing capacity to fightGrowing capacity to fight corruption (cont)corruption (cont)
4. Improving representivity4. Improving representivity SUI has an employment equity plan and
employment equity forum Major focus in recruitment to improve
representivity, especially at a management level
80% (47 of 59) of new staff from designated groups
67% of all permanent staff are from designated groups
43% are black - 48% incl contract workersManagers – only 1 black, 1 woman in 2001Now: 9 designated groups, 8 black, 3 women
5. Ensure competitive salaries5. Ensure competitive salaries
New salary grading implemented to align salaries with the public and private sector
Entire process completed and all staff on placed on correct levels
Enabled SIU to have proper career paths and retain present staff
Have been able to attract good quality applicants
6. Promoting greater efficiency6. Promoting greater efficiencyDeveloped pro-active project approach
ensure greater impact and faster outcomesImproved project management approach
towards outcomes based resultsIdentify premier projects where potential
impact is greatestIntroducing time sheets
7.7. Legal changes to Legal changes to improveimproveeffectivenesseffectiveness Effectiveness of SIU severely affected by a
number of judgments re ability to litigate Present referral processes re proclamations are
ineffective and cumbersome SIU propose amendments to clauses relating to
litigation and power to authorise investigations internally
SIU obtained opinion from senior counsel on the amendments, and related constitutional issues
Urgent amendments to Parliament second half of year
8.8. Establishing nationalEstablishing nationalpresencepresence
Previously SIU based in East London with teams for each province and a satellite office in Umtata
Decided that it would be more effective to establish a national presence
Pretoria office now fully established Head office move to Pretoria end 2004 Durban office experienced significant growth Satellite offices in Nelspruit and Cape Town
established These offices beginning to generate work in their
regions
9.9. Improved cooperation withImproved cooperation withlaw enforcementlaw enforcement
SIU enjoy good relations with number of law enforcement agencies and government institutions: SAPS, DSO, NPA, OAG, PSC
In process of finalising MoUs with these agencies SIU involved in multi-agency task teams with a
number of other agencies wherein each agency complement powers others, eg. DCS, JACT
Due to resource constraints in the criminal justice system, SIU provide capacity deal with prosecution, criminal investigations, etc.
Integrated project management approach result in recognition of each agency’s contribution
Employment EquityEmployment Equity
0
20
40
60
80
100
120
140
160
180
200
2000/2001 2001/2002 2002/2003 2003/2004
Years
PDI's
White males
10. Building partnerships with10. Building partnerships with governmentgovernmentImportant to collaborate with government to
fight corruption effectivelyDealt with partnerships earlier
InvestigationsInvestigationsDeveloped a clear focus for investigations
based on environment scan, internal case audits, review of SCOPA and AG reports
Investigations focus on national, provincial and local departments and some parastatals
SIU focus informed by its strong forensic investigative capacity maladministration identified in some government departments
SIU investigative capacitySIU investigative capacity SIU provides full investigation of corruption cases
• Members can take proper affidavits• Powers of search and seizure• Power to interrogate witnesses and suspects under oath
similar to DSO• Witnesses have to answer self incriminating questions• Strong forensic investigative capacity• Can ensure civil, criminal or internal disciplinary
outcome• Completed investigations resulting in court ready
cases, civilly or criminally• An operative Special Tribunal will ensure speedy
litigation proceedings unlike delays in ordinary civil courts
1. Profiling: DCS1. Profiling: DCSEmanate from DCS after Jali commissionDCS funding half the cost of a team of 25 • Recovered R17 million from 6 doctors • Secured savings of R370 million re
medical aid – prev year R122 million• 113 matters referred for further criminal
investigation and prosecution• Incl Prov Commissioner Eastern Cape• 39 internal departmental hearings
1. Profiling: DCS (cont.)1. Profiling: DCS (cont.)Investigating prisoner-warder allegations
through prison visitsNational procurement processesFirst Auto petrol & maintenance card abuse• Assaults, drugs• Booking prisoners out unlawfully• Selling of jobs• Promotions and appointments – nepotism• False qualifications • Irregular parole, remission
2. Profiling: DoJ2. Profiling: DoJ Focus on maladministration and possible
corruption at 40 magistrates’ courts:• Main focus – Estates, maintenance, overtime and
fines• Secondary – Bail, leave, S&T, etc Work in terms of comprehensive audit-based
generic work-plan Completed investigations at 8 Magistrates Courts Additional 4 courts are nearing completion Ongoing investigation at 9 courts
2. Profiling: DoJ (cont.)2. Profiling: DoJ (cont.) Recovered R258 660 from DoJ officials Calculated the total potential loss to DoJ at
R19 million 49 criminal cases being investigated against DoJ
officials And 54 disciplinary cases
3. Profiling: DoT (Limpopo)3. Profiling: DoT (Limpopo)Focus on unlawful issuing and selling of
licenses, and irregular registration of vehiclesInvestigating all drivers’ licences issued since
1994 Examined 13 centres thus farFound another 5 000 licences issued
irregularly Another 1 400 physically cancelledConcluded 41 disciplinary hearings, 22
dismissals National DoT working with SIU to extend
investigation nationally
4. Profiling: WPP (KZN)4. Profiling: WPP (KZN)Serious financial irregularities at KZN Witness
Protection Program prior to takeover by NPAWorked with new Director to investigate• Rentals from family and friends of staff
members• Safe house rentals inflated• Paid rent for houses that do not exist• Mismanagement of resources / lack of controls• Improper handling of witnesses• Criminal charges against 2 previous employees
and 6 estate agents for fraud committed to value of R4.3 m thus far – bail R 1 million
5. Profiling: DoH KZN5. Profiling: DoH KZNMassive investigations of all state subsidies
granted in Gauteng, KZN and N Cape Identify several attorneys involved in
fictitious subsidy claim schemes with housing money
Fraud amounting to more than R20 millionR3.4 million returned to governmentSIU pursuing claim against fidelity fund iro
bankrupt attorneys
6. Profiling: JACT6. Profiling: JACT Joint Anti Corruption Task Team in Eastern
Cape – with SAPS, Scorpions, AFU, AG SIU instrumental in setting up infrastructure Several SIU members seconded to work full-
time on JACT JACT has a caseload of 340 cases Investigations ongoing at various departments,
which include essential service providing departments such as Health, Education, Public Works and Welfare
In the past year JACT has made 96 arrests
Return on InvestmentReturn on Investment
Outputs
Performance
Measures
2003/2004 Target
2003/2004
Actual
(unaudited)
2004/2005 Target
Investigation of corruption and prevention of losses to the State
Savings
(incl preventions)
Cash
recoveries
R70m
R50m
R373,9m
R 14,0m
R500m
R 30m
Totals R120m R387,9m R530m
Verification report detailVerification report detail
Cash Recoveries
(incl. cash recovered by third parties)
2003/2004
Actual
(unaudited)
Total
Notable cases: DCS DoE (Limpopo) DoH
R14,0m
R7,6m
R1,6m
R1,4m
Other areas of impactOther areas of impact
Description
2003/2004
Actual number of
cases
2004/2005
Target number of
cases
Evidence prepared for use in civil litigation
Evidence prepared for use by criminal prosecutions
Evidence prepared for use in disciplinary proceedings
165
52
114
40
200
330
BudgetBudget
Details
2003/2004
Unaudited
2002/2003
Audited
Income
- Government grants
- Partnership agreements
- Other
Expenditure
- Operational salary expenses
- Operational/investigation expenses
- Non-operational salary expenses
- Overhead expenses (incl. depreciation)
R40,9m
R25,5m
R12,9m
R 2,5m
R42,0m
R25,2m
R 6,3m
R 4,3m
R 6,2m
R26,3m
R22,9m
R 2,9m
R 0,5m
R30,1m
R 16,1m
R 5,3m
R 3,1m
R 5,6m
AdministrationAdministration Spent R11.9m more Proud that overheads only increased by R1.8m –
15% of increased spending Cut expenses to the bone – to extent of staff
sharing rooms when travelling Excellent administration and financial controls Fully PFMA compliant Good use of information technology Serious about training – eg CBT Filled 59 new positions – received 9140
applications
ConclusionConclusionSIU very successful year Made massive savings of R374 millionMade big impact in systemic improvements
in key departmentsPartnership collaborations – contribute to
successful SIU profileGood return on government investment
demonstrates any increase will be effectively used
Negotiate legal hurdles through legislative amendments