South Africa’s biggest transport company blacklists 7 suppliers for fraud

South Africa’s state-owned transport company, Transnet, has blacklisted seven companies and initiated disciplinary action against nine employees for collusion with suppliers.

As the company intensifies its fight against fraud, Transnet Port Terminals (TPT) successfully applied to the National Treasury to blacklist the companies implicated in serious unethical and unlawful conduct.

The decision follows investigations by the Special Investigations Unit (SIU), which uncovered a range of irregularities, including financial misconduct, kickback schemes, bribery, theft of company assets, collusion, and the submission of false information.

TPT Chief Executive, Jabu Mdaki, noted that unlawful conduct will not be tolerated, and the company remains committed to upholding good governance and conducting business with integrity, transparency and accountability.

He added that the blacklisted companies have been barred from business with TPT, Transnet and other public entities for ten years.

The port terminals operator also instituted disciplinary action against employees who colluded with the blacklisted companies over the years.

Mdaki explained that it is important for TPT to take firm action against employees, suppliers and all stakeholders who compromised the integrity of the business as it reinvents itself for growth.

“TPT has a mammoth task of enabling South Africa through our specialisation in maritime logistics, where the country trades with over 100 markets in the world,” he said.

“As a team, we are united in understanding that we exist to serve and there’s no room for anyone who does not share in that mission.”

The entity is collaborating with relevant entities to recover all embezzled company monies from the implicated individuals.

Transnet added that it is continuing with investigations across its Operating Divisions after the Transnet Rail Infrastructure Manager (TRIM) suspended four employees for similar allegations.

Earlier this year, the company suspended nine employees implicated in alleged collusion with suppliers, six of whom have left Transnet’s employment. Disciplinary proceedings against the other employees continue.

A new era for Transnet

The state-owned transport company continues to issue requests for proposals to expand its national network, including station leasing programmes and increased access to rolling stock.

In May, the TRIM issued a Request for Proposals for Phase 1 of its Station Leasing Programme in the Western Region, inviting parties to lease, invest in, develop, operate and maintain station precinct assets for 10 years.

This forms part of the manager’s efforts to unlock value from its rail assets through structured private sector participation, covering three station facilities – Dal Josafat, Huguenot and Bitterfontein.

It includes the leasing and commercialisation of bundled station assets such as land, warehouses, retail buildings, goods sheds and office facilities.

“This programme demonstrates TRIM’s continued commitment to transparent, market-based access to strategic rail assets,” explained TRIM Chief Executive, Moshe Motlohi.

“Through private sector participation, we aim to strengthen partnerships, improve our service delivery and unlock long-term economic value across the South African rail network.”

A month later, it issued another RFP, this time to partner with The Leasing Company (LeaseCo) to acquire, manage, and lease rolling stock to domestic and regional markets.

Transnet explained that the establishment of LeaseCo is a cornerstone of South Africa’s rail reform agenda, designed to modernise freight rail operations and attract private sector investment.

The group’s CEO, Michelle Phillips, said that significant unmet freight demand, driven by a shortage of available rolling stock, presents a compelling opportunity for a dedicated leasing entity.

“LeaseCo represents a transformative initiative primed to modernise Africa’s rail system, mobilise private capital, and enhance the reliability of freight logistics,” she declared.

“With the significant demand from train operating companies (TOCs), LeaseCo is well positioned as an appealing investment opportunity.”