The Eastern Cape Development Corporation (ECDC) has terminated its employment contract with CEO Sitembele Mase, with immediate effect, following a forensic investigation into unauthorised expenditure relating to the funeral of the late former President Nelson Mandela.

The investigation revealed that funds were transferred in advance to the accounts of various service providers and that neither supporting documentation nor evidence of goods was provided to forensic investigators to justify the due process followed.

Procurement policies were also not followed.

The CEO was also previously charged with financial misconduct relating to unauthorised salary increases within the ECDC in the 2013/14 financial period.

The ECDC board said in a statement on Thursday that, owing to the various allegations against the CEO, the “trust relationship” between the board and Mase had “broken down irretrievably” and that it was not in the best interest of the corporation or its shareholders to continue with the employment relationship.

“The ECDC is a public entity and the allegations of misconduct, such as those mentioned against the CEO, cannot be tolerated,” it asserted.

When asked to provide reasons for his actions regarding the unauthorised expenditure at a meeting of the board on March 14, the ECDC considered his responses “uncooperative and insubordinate”.

“The board viewed the CEO’s transgressions seriously and was alarmed at his visibl[e] disregard of corporate governance, as he had shown no remorse [for] his actions at the meeting.

“The CEO violated his conditions of suspension as he failed to assist and provide certain information for investigation, despite repeated communication requests sent [to] his attorneys to attend the interview with the forensic investigators and submit the completed questionnaires,” the corporation said.

It added that the immediate termination of the CEO’s employment contract was in the best interest of the corporation, corporate governance and the Eastern Cape.  

Nonexecutive director Reggie Naidoo would continue in his acting role until the appointment of a new CEO.