Ishwarlall Ramlutchman investigated again: No well, no fine

In December 2018, the Hawks began a fraud and corruption investigation into high-profile Richards Bay tenderpreneur, convicted fraudster and philanthropist Ishwarlall Ramlutchman over a R95-million drought-relief project commissioned by the Umzinyathi district municipality in northern KwaZulu-Natal.

Twenty months later, investigators have still not taken a warning statement from Ramlutchman, who goes by the title Mabheka Zulu, given to him because of his charitable works and his lengthy friendship with King Goodwill Zwelithini.

Criminal charges have also not been laid against Ramlutchman, the founder of the Sivananda Peace Pillars Project, despite the passage of almost two years, according to his lawyer, Veronica Singh.

Ramlutchman, who refers to himself as the monarch’s “son’’, is also a leader of the Global Organization of People of Indian Origin (Gopio) and is a crucial player in the Sivananda spiritual movement in South Africa.

In 2018 he unveiled bronze statues of Zwelithini and former president Nelson Mandela in Durban and last year hosted the Zulu monarch’s Diwali celebration at his Ondini palace.

Shortly after the Durban statue unveiling, the probe into the Umzinyathi borehole project began, after an initial complaint was laid at the Dundee police station over the alleged failure of the service providers involved to drill the boreholes, for which they were nevertheless paid at allegedly inflated rates.

The high-flying, car-loving Ramlutchman — the Asset Forfeiture Unit tried to take away his 26 luxury vehicles — has maintained his innocence regarding the contract for the boreholes, which are currently being upgraded and refurbished in terms of a new tender issued by the municipality.

But this is not Ramlutchman’s first brush with the law. In 2013 he was convicted of fraud and corruption for falsifying his qualifications with the Construction Industry Development Board (CIDB). He was fined R500 000 and given a five-year jail sentence, suspended for five years.

Back then, Ramlutchman, through his company AC Industrial, allegedly gave the CIDB false documents to improve the company’s grading and allow it to bid for tenders that were more substantial than it could deliver on. As a result, he was awarded 16 projects by the KwaZulu-Natal department of public works, including 14 schools and two hospitals, between May 2006 and August 2008, with a combined value of R52-million. Ramlutchman’s company was not qualified to tender for these projects.

The court found that AC Industrial had also falsified its financial records to reflect a turnover of R84-million as part of the process of manipulating the grading system.

Although he pleaded guilty, Ramlutchman blamed the scam on a company accountant, claiming he did not know the records had been falsified. The case appears to have had little effect on Ramlutchman’s dealings with the government in KwaZulu-Natal, with whom he continued to do business.

Before waiting out his five-year sentence, the businessman was appointed by the Umzinyathi district municipality to be part of the R95-million drought-relief project.

Senzo Mzila, the spokesperson for the provincial department of co-operative governance and traditional affairs, has not responded to questions about why the municipality handed a convicted fraudster any part of the multimillion-rand tender.  

Both the Hawks and the National Prosecuting Authority (NPA) said this week that the case against Ramlutchman, initiated by the department, was still under investigation. 

A decision on whether to prosecute Ramlutchman over the R95-million project for boreholes at Umzinyathi, which covers Dundee, Dannhauser, Glencoe and several other towns, would be taken only when the probe — which included a forensic investigation by auditors PWC — had been completed.

Mangosuthu Buthelezi and Zwelithini at a function. Ramlutchman refers to himself as the Zulu monarch’s ‘son’

Singh said this week that she had been appointed by Ramlutchman as his lawyer last December after he read newspaper articles about the investigation. She had subsequently liaised with the Hawks, who had confirmed that the provincial department of co-operative governance and traditional affairs had initiated a corruption case.

Singh said Ramlutchman “was never awarded the tender for the establishment of the boreholes” and had acted only as a consultant on the project.

She said she had met the Hawks on behalf of Ramlutchman and Thandwa Mbhele, the contractor who drilled the boreholes, in January 2019 and provided them with banking and other documents required for the investigation. 

Mbhele, she said, had met PWC in March 2019 and provided the auditing firm with the information and documents it required.

“Both our clients have offered their complete co-operation in the investigation since they are intent on having their names cleared,”’ Singh said.  

“Neither of our clients has been charged in respect of this allegation, nor have they been arrested or detained under any suspicion. Neither have warning statements been taken from our clients.”

Singh said she had been informed by the Hawks that a meeting with the NPA to obtain direction on the investigation had been postponed because of Covid-19.

“Our offices, together with our clients, have endeavoured and will continue to assist the investigator, the prosecutor and all other stakeholders expeditiously. Our clients’ only wish is to be exonerated from the allegations,” she said.

KwaZulu-Natal director of public prosecutions Elaine Zungu said that the borehole case was still being investigated. She said the R500 000 fine and five-year suspended sentence Ramlutchman received in 2013 had been imposed at the court’s discretion after he pleaded guilty in terms of section 112 of the Criminal Procedures Act. Corruption carries a potential sanction of 15 years in jail.

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