A Zimbabwean accountant has had his estate finally sequestrated after defrauding Johannesburg-based non-profit organisation, the Education and Training Unit, of millions of rand.
Edward Mwanandimai, who served as an accountant at ETU from July 2014 until his voluntary departure in May 2020, siphoned off millions of rands meant for the South African Revenue Service and other suppliers.
Court papers from the Gauteng High Court, Pretoria, reveal that the first fraudulent ETU payment occurred in January 2015, with 384 such transactions taking place during his employment. The last of these was made in April 2020.
Instead of directing payments to SARS and other legitimate creditors, Mwanandimai diverted funds into his own bank accounts and to Lopdale Services and Investments, a company linked to him.
An internal ETU investigation found that these payments never reached their intended recipients. Between January and July 2015 alone, one of his personal accounts received nearly R679,000.
Lopdale Services and Investments was paid R14.65 million between August 2015 and December 2019, with a further R396,100 also transferred.
Mwanandimai’s scheme extended beyond supplier payments. He created supplier accounts that closely resembled existing ones, manipulated bank master data and payroll records, and even fabricated a fake employee under ETU’s Discovery Medical Aid Scheme.
This resulted in fraudulent contributions totalling R160,845 between September 2017 and April 2020. ETU also unknowingly paid R239,819 towards his Bestmed medical aid contributions between November 2016 and April 2020, without deducting the amounts from his salary.
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Additionally, ETU covered his cellphone bills and three debit orders he had set up on its account.
His actions were uncovered after ETU hired a new accountant, who audited the books and discovered that Mwanandimai had misappropriated more than R17 million.
Of this, about R6.8 million was confirmed as capital debt. In September 2020, Mwanandimai signed an acknowledgment of debt, admitting to stealing several millions from ETU and agreeing that the amount owed was R6,797,715.60.
He repaid part of the stolen funds and later offered to settle the remaining R1.77 million, claiming he could only afford to pay R100,000 a month due to the financial impact of the Covid-19 pandemic and the July 2021 looting unrest on his business.
In October 2021, he proposed a payment plan of R10.9 million over 72 months, which was less than the confirmed outstanding balance of R17.1 million. However, he made no payments after June 2021.
Acting Judge Sanet van Aswegen ruled last Thursday that Mwanandimai had failed to manage or disclose his estate with adequate transparency, noting that supporting documents were only provided at the hearing despite earlier opportunities.
The judge granted a final sequestration order, stating that it would serve the interests of justice by enabling a proper investigation of Mwanandimai’s estate under the Insolvency Act for the benefit of all creditors.
ETU had also reported the fraud to the Yeoville police station in September 2020. Attempts to obtain comment from Mwanandimai’s legal representatives and ETU were unsuccessful.
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