UJ official must pay back R18m after taking student housing bribes

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An axed senior director of student affairs at the University of Johannesburg (UJ) has been ordered to repay more than R18-million to the institution for corrupt and fraudulent contracts for private student accommodation.

This may be the first case of its kind, where an employee is held to account for fraud and corruption under the Basic Conditions of Employment Actâs contractual provisions.

UJ claimed that Andries Helani, then head of student affairs, had never declared any conflicts of interest.

Judge Reynaud Daniels of the Johannesburg Labour Court delivered judgment on Friday.

Helani was employed as the head of student affairs from January 2017 until he was dismissed in March 2024. He managed and oversaw the accreditation of privately owned student accommodation funded by the National Student Financial Aid Scheme (NSFAS).

He was obliged to declare any actual or potential conflicts of interest annually.

In 2021, Helani deviated from the usual accreditation process. Instead of the student affairs department running the process, private property owners were subjected to a tender process. However, as subsequent investigations found, Helani still maintained control over the entire process.

Properties accredited

In November that year, Mahlatse Investments applied for the accreditation of two properties in Jorissen Street and Bertha Street, both in Braamfontein. The tender committee was told that, in January 2022, the two properties were inspected by student affairs, occupational health and safety and protection services and property management. The committee ultimately accredited the properties.

The Jorissen Street property was to host 748 beds and the Bertha Street property 693.

UJâs payment merchant, Fundi Capital (Pty) Ltd, was authorised to enter into agreements with Mahlatsi Properties, whose directors were Siphiwe Khoza and Stanley Nkele. Nkele was also a director of Mahlatse Investments.

Mahlatsi Properties was paid just more than R17-million for 1,441 beds over eight months.

Following an initial investigation by Nexia SAB&T into the 2022 accreditation process, it emerged that the two properties had less than half of the promised beds.

In November, students demonstrated over the lack of accommodation and other failed promises by the landlord.

UJ then commissioned a more in-depth investigation by ENS Attorneys. That probe showed that the documentation submitted for the two properties did not meet compliance requirements.

The Jorissen Street property only had 125 beds, and the Bertha Street property only had 174 beds.

The probe found that it was unclear if protection services had actually inspected the properties, and adverse findings by occupational health and safety officers were not taken any further.

Bribery

In his ruling, Daniels said it was common cause that Helani had received several payments into his personal bank account directly from Mahlatsi Properties and/or Mahlatse Investments and Khoza.

In March 2022, he received R30,000; in April 2022, R29,000 was paid to his sonâs school for fees; and in October 2022, he received R9,000.

The judge said that Helani had received more than R3.2-million from the two companies and other private accommodation service providers through 366 payments between March 2021 and March 2024. During this time he did not declare any outside business activities or any relationship with any of the service providers.

A student who testified during the trial told of how she was living at home when she was induced with payments into registering at the Mahlatse residence.

Although she never lived there, she was paid R1,700 a month and a lump sum of R8,500. When Fundi stopped payments to the Mahlatse entities in late 2022, she was told to email the university and say she had been evicted from the residence, which she did, although it was a lie.

Nexia investigator Christiaan Powrie testified that he and a colleague had conducted a physical bed count of the two properties. The university officials, who allegedly conducted the original inspection, were supposed to attend but failed to arrive.

Apart from establishing the real bed count, they also found that there was only one UJ student living in both buildings, and that Mahlatse did not own or manage them.

Siphamandla Makhaya, a senior lecturer who sits on the tender committee, said it had relied on Helaniâs reports when it had approved the accreditation of the two buildings.

During the subsequent probe by ENS, Helani claimed that he had sold a property to Khoza but could not produce a deed of sale. He also claimed he had borrowed money from Khoza but did not provide any proof of repayment.

In his evidence in the Labour Court, the judge said Helani had âattempted to distance himself from the accreditation processâ and from knowing that Khoza was linked to the Mahlatse entities.

He claimed he did not scrutinise the list of recommended properties, although he prepared the final memorandum to the tender committee.

He denied that any of the payments he received âconstituted kickbacks or bribesâ.

Khoza was simply a friend whom he had met in 2019 on a holiday, who was helping him out to pay lobola, his wedding and his childâs school fees.

He was not required to disclose this because it was âprivateâ.

Daniels said Helani had not disputed most of the evidence. He said he âclearly had insightâ into Khozaâs business dealings. His version that he did not need to declare this relationship was not only improbable, but âremarkableâ.

âFar-fetchedâ

âThe defendant is a skilled and educated man⦠These versions are so far-fetched that they diminished his credibility.â

The judge said Helani had not distanced himself from the accreditation process, but had remained the âproject leaderâ and his failure to flag Khoza and others constituted a breach of duty.

While he had no power over the tender committee, it had relied heavily on his report and recommendations.

He had also actively represented to the bid evaluation committee that he said was managing the inspection process.

âThe most natural inference, which is consistent with all the proved facts, is that the payments constituted bribes for [Helaniâs] help in ensuring that Mahlatse Investments and its two properties were accredited.

âAside from [Helani], many students and several other employees also received monies for their role in defrauding the university through the ⦠scheme,â Judge Daniels said. âThis suggests a complex, coordinated scheme to defraud the university, rather than isolated, innocent transactions by the defendant⦠He was a willing and active participant in a scheme to defraud the university.â

The two entities had been paid R17-million, and Fundi had claimed just over R1-million for its fees. The total amount paid by the university for the two non-compliant properties was just over R18-million.

Daniels ordered that Helani pay back the money and pay the costs of the application. DM

This article first appeared in GroundUp.

Reporting originally appeared via Daily Maverick. Read the full source for additional context.