Siyambonga Mhlakaza during a previous court appearance.
The Mthatha Commercial Crime Specialist Court sentenced Siyambonga Mhlakaza (35) to 18 years in prison for embezzling R1.2 million from Walter Sisulu University (WSU).
He was sentenced to 18 years for money laundering and 15 years for 81 counts of fraud, which were treated as one. The court ordered that the sentences be concurrent.
The court delivered its verdict on February 11.
Mhlakaza pleaded guilty, admitting to being part of a scam that saw stipends intended for financially disadvantaged students and academic staff salaries diverted to his bank accounts.
At least 81 students, some of whom ended up dropping out of college due to financial hardship, were affected.
In his plea explanation, Mhlakaza claimed that he was approached by a WSU employee working at the Financial Aid Office section, who requested his bank accounts to deposit funds into. He said the financial challenges he faced at the time made him accept it.
Mhlakaza, a Rhodes University Bachelor of Pharmacy dropout, did not reveal the name of the WSU employee to authorities, but he admitted to giving the person his bank details. Subsequently, deposits of between R6,000 and R89,000 were made to his accounts between April and June 2016.
He further admitted in court that he transferred the money to different bank accounts he held with different banks to disguise, disguise the nature, source, location, disposition and movement of the money he spent for his own benefit.
The fraudster further confessed that he called Intelimali, a private company responsible for distributing stipends to students and pretended to be an eligible student who wanted to verify the stipends and change his bank details.
Intelimali officials will then deposit the funds due to these students in its various accounts.
WSU has launched an internal investigation after an alarm was raised by one of the students, whose stipend was not paid into her account. The investigation revealed that funds from the Motsepe Foundation and the National Student Financial Aid Scheme (NSFAS) had been diverted to Mhlakaza and others.
The subsequent investigation by South African Police Service Provincial Commercial Investigations Sergeant Thembani Langeni led to Mhlakaza’s arrest in May 2021. He was arrested and charged along with his accomplices, Nolufefe Matera, Sibongiseni Matshamba and Loyiso Siyo. The three have pleaded not guilty and their trial, which is scheduled for March 16, has been separated from that of Mhlakaza.
State attorney Ncedo Buso implored the court to sentence Mhlakaza to a direct prison term of at least 15 years.
He argued that not a single penny of the money defrauded and laundered by Mhlakaza had been recovered. The prosecutor added that Mhlakaza’s admission of guilt was not a sign of remorse, but he saw that the evidence against him was overwhelming.
In passing sentence, Magistrate Shylock Ndengezi agreed with the prosecutor and warned WSU officials who were in the gallery that the mastermind behind the elaborate scam is still unknown and among them because Mhlakaza refuses to reveal his identity.
“Your conduct has had far-reaching devastating consequences for the future of poor students,” Magistrate Ndengezi said.
The National Prosecuting Authority (NPA) welcomes the conviction of the confessed fraudster, who has a previous conviction for shoplifting in Makhanda. “We hope this will have a deterrent effect on other potential white collar criminals.”