DIRECTORSHIP CONTROVERSY IN COMPANY PROBING DRUGS SHORTAGE

MBABANE – Who is the real director of Funduzi Forensic Services Pty Ltd?

According to papers filed at the Industrial Court, Thulani Mabuza, who says he is a male businessman of Mbabane, has identified himself as the director of this company that has been engaged by government, through the Office of the Auditor General (AG), to conduct a forensic audit on the acquisition and distribution of medicines to public health facilities under the Ministry of Health. Because of this directorship status, Mabuza informed the court that he was duly authorised to depose to an affidavit on behalf of Funduzi, where he is responding to allegations by two Ministry of Health officials, Sincedzile Magwaza and Fortunate Bhembe, who have successfully obtained an interim order stopping the investigation against them.
However, Magwaza and Bhembe, responding to Mabuza’s affidavit, submitted to the court a number of documents purporting that the director resigned from Funduzi.

resigned

The documents show that one Paston Mndeni Dlamini is the sole director of Funduzi after Mabuza resigned on November 29, 2022. One of these documents is a letter bearing the same date and a signature purported to be that of Mabuza, which is referenced ‘Resigned as a director of the company’, and reads: “I Thulani G. Mabuza resigned as a director of the above mention company (sic).” There are also minutes of an extraordinary meeting held at Funduzi’s office in Mbabane on November 29, 2022, which reflect that Mabuza resigned and Paston Dlamini took over the company. “It was resolved that Thulani G. Mabuza has resigned and Paston Mndeni Dlamini has appointed as new director of the above mention company. Mr. Thulani Mabuza has transferred his shares to Mr. Paston M. Dlamini. Directors will be as follows; Paston Mndeni Dlamini – 100 per cent (sic),” reads the minutes which were signed by both Mabuza and Paston.

There is a share certificate that has been annexed to the court papers and it also purports that Paston is the 100 per cent shareholder. The certificate states: “This is to certify that Paston Mndeni Dlamini of Funduzi Forensic Service is the registered proprietor of 100 per cent shares of One Lilangeni each, fully paid up, numbered as per margin inclusive in the Share Capital of E100 subject to the Memorandum and Articles of Association of the Company. Given at Mbabane this 29 day of 11, 2022.”  

reflected

It is also reflected in the Form J of the company with a stamp from the Registrar of Companies dated December 9, 2022 that Mabuza resigned on November 29, 2022. A letter of the same date (November 29, 2022) purports that Paston accepted the appointment as it reads: “I Paston Mndeni Dlamini has accepted as a director of the above mention company (sic).” Magwaza, in the replying affidavit, said Mabuza does not have authority or capacity to depose to an affidavit on behalf of Funduzi because he purportedly resigned as both director and shareholder of the company on December 29, 2022. She averred that the resignation was registered with the Office of the Registrar of Companies on December 9, 2022 and this position she reportedly affirmed when she carried out a search at the said office.

authority

“In view of the foregoing, Mabuza does not have authority to represent Funduzi nor does he have authority to depose to an affidavit on its behalf. I annex hereto marked ‘SDM 28’ a copy of the records of the registrar of companies as well as the confirmation of the resignation of Mabuza as a director, and the transfer of his shares to one Paston Mndeni Dlamini,” reads Magwaza’s affidavit. Magwaza and Bhembe have informed the court that an application will be made on Thursday, July 13, 2023 at 9:30am or so soon thereafter for the striking out of the entire affidavit of Mabuza, which was filed on July 4, 2023. “The reason for the striking out is that: the said Thulani Mabuza does not have the authority and capacity to oppose the application to produce documents, depose to an answering affidavit on behalf of the sixth respondent (Funduzi) as at the material time, he was neither a director nor a member of the sixth respondent,” reads the notice to strike out.

The health officials have also prayed that Funduzi and Mabuza should pay costs for the application. According to the documents annexed to the court papers, Paston and Mabuza both gave their addresses as P.O Box 9 Mankayane, which is the postal address as that of Emalangeni Primary School. This is the Post Office Box that these two people provided when the registered as directors of Funduzi and remain in the registration papers at the registry of companies.

registration

In the company registration papers, the postal and physical addresses of Funduzi are not provided, save for that of the director(s) as being of the primary school. This school is located in a rural area that is about 25 kilometres away from Mankayane town. Access to the area is through rough gravel road that is full sharp, big stones and huge potholes that are sometimes filled with rain water such that they may be mistaken to be permanent ponds. Motorists also have to negotiate their way through cattle that are a constant feature along this road. It is little wonder, therefore, that public transport is scarce on this road and, as confirmed by some residents, a kombi that services one of the communities there travels once in the morning when it drives commuters to Mankayane and drives them back in the evening.

In between the morning and evening, there is no public transport and the people have to travel by foot. This is hardly the area you would expect to find a company that conducts forensic investigation involving hundreds of millions of Emalangeni. When the Times SUNDAY went to Mankayane town and made its first stop at the Post Office, it got confirmation that the P.O Box 9 Mankayane that appears on the papers of Funduzi Forensic Services actually belongs to Emalangeni Primary School. In court papers,  Magwaza stated that she had been made aware that Funduzi is a local company and its postal address she found as a consequence of a search was PO Box 9 Mankayane.

attention

She further brought it to the attention of the court that the registration of the company was on October 10, 2022. She submitted that the relevance of the date of registration pertained to the company’s competence in respect of compliance with procurement provisions. Magwaza further submitted that she had been advised that the provisions of the Procurement Act as well as regulations and any circulars issued in terms thereof, were applicable to the appointment of Funduzi by the Auditor General. She contended that the AG had not, in the appointing of the company, used a permissible public procurement method, rule, process or document and none of the provisions listed in the Procurement Act, which permitted deviation from laws applicable to its appointment. Magwaza said it was inconceivable that an entity that was incorporated a few months ago would have mastered the threshold for experience and competence to carry out a forensic investigation of this nature.

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