The Port Elizabeth Commercial Crimes Court found ward 20 ANC councillor, Bongo Nombiba, guilty of fraud and money laundering.
Nombiba was also acquitted of two counts of corruption.
He fleeced the Nelson Mandela Bay Municipality out of R20 000 from a discretionary fund for an NGO.
Handing down judgment, Magistrate Johannes Claasen, said during cross-examination, Nombiba was evasive when he was asked to explain his side of the story.
Claasen said he was also argumentative and defensive.
The municipality's city manager, Johann Mettler, said Nombiba's future as a councillor will depend on the sentence handed down.
"In the event that court sentences the councillor to 12 months or more direct imprisonment without the option of a fine then that councillor will automatically seize to be a councillor. If there is a lesser judgement it may also be that the councillor has transgressed the councillor code of conduct and then the rules and ethics committee of council may also consider the matter," he said.
Nombiba is expected to be sentenced on the 26th of April.
