Convicted fraudster Nthapeleng David Serame has begun serving his seven-year prison sentence for 406 counts emanating from a criminal enterprise to defraud the Mangaung Metro Municipality (MMM) of about R9,6 million through fraudulent procurement.
The state successfully appealed his suspended sentence, with judgment for a direct prison sentence handed down on Friday 20 March.
In October 2024, the Free State High Court was granted leave to appeal the Bloemfontein Regional Court’s seven-year prison sentence, suspended for five years on condition that he not be convicted of fraud or theft during the period of suspension. The State noted the severity of the crimes and that Serame’s personal circumstances should “recede to the background” in favour of community justice.
The State argued the sentence imposed in 2022 was shockingly lenient given the scale of the corruption and fraud. An additional aspect contributing to the leniency was the State’s withdrawal of criminal cases against three municipal officials found to have colluded with Serame. Criminal cases against the officials were withdrawn apparently for lack of evidence.
The sentence was based on Serame’s guilty plea, which the Regional Court accepted. He was further sentenced to 36 months of correctional supervision. The case against Serame and his five entities involved a R11,6 million scheme to defraud the municipality and the South African Revenue Service (Sars), which suffered prejudiced amounts of almost R2,3 million and R628 095.38 in income tax. The involved companies were Iceberg Trading, Snowline Trading, Ka Rona Trading, Seventh Avenue Trading, and Senthati Trading, and benefited by about R9.6 million through fraudulent procurement from the municipality.
In the High Court, it emerged that Serame violated the plea bargain by failing to pay SARS amounts of almost R2.3 million and R628 095,38 in prejudiced income tax. It was revealed that only R12 000 was paid in two payments of R6 000 on 30 June 2021 and 12 January 2022, rendering the plea null and void.
Serame was convicted and sentenced for fraud, corruption, money laundering, and tax evasion. The findings revealed no goods or services were delivered and the five entities continued to receive payment from the municipality, although they were dormant. The findings revealed Serame knew that the municipality would consider quotations for goods and services quoted below R30 000, hence he submitted quotations lower than the amount in question.
He will serve the seven years.
