Picture Provided : GCIS

Business In The News South Africa

Public Protector says Absa must pay back the money

TSHWANE, June 19 – Public Protector Busisiwe Mkhwebane on Monday criticised government and the South African Reserve Bank (SARB) for failing to recover more than one billion rand from Bankorp Limited/ABSA Bank billions advanced as an “illegal gift” to the Bankorp group, which was bought by ABSA in the early 1990s.

“The allegation whether the South African government and the Reserve Bank improperly failed to recover from Bankorp Limited/ABSA Bank an amount of R3, 2 billion cited on the CIEX report, owed as a result of an illegal gift given to Bankorp Limited/ABSA Bank between 1986 and 1995 is substantiated,” Mkhwebane told a media briefing in Pretoria.

“The correct amount of the illegal gift granted to Bankorp Limited/ABSA Bank is in the amount of R1,125 billion.”

Mkhwebane added that the South African populace had been prejudiced by government’s failure to recoup those huge sums of money.

“The amount given to Bankorp Limited/ABSA Bank belonged to the people of South Africa. Failure to recover the ‘gift’ resulted in prejudice to the people of South Africa as the public funds could have benefited the broader society instead of a handful of shareholders of Bankorp Limited/ABSA Bank,” she said.

“The conduct of the South African government and the South African Reserve Bank goes against the ethos laid out in the preamble of the Constitution and section 195 of the Constitution in respect of redressing social injustices and promoting efficiency.”

Mkhwebane said the conduct of government and the SARB constitutes “improper conduct and maladministration”.

For remedial action, Mkhwebane has referred the matter to the Special Investigating Unit, which must in turn approach President Jacob Zuma to reopen the presidential proclamation R47 of 1998 “in order to recover the misappropriated public funds unlawfully given to ABSA Bank in the amount of R1.125 billion”.

The Public Protector has probed allegations that CIEX, a covert United Kingdom-based asset recovery agency headed by Michael Oatley, was contracted by Pretoria to assist in investigating and recovering misappropriated public funds and assets allegedly committed during the reign of the apartheid regime.

“The allegation whether the South African government improperly failed to implement the CIEX report … after commissioning and duly paying for same is substantiated. CIEX Limited was paid 600,000 British Pounds for services which were never used by the South African government. No evidence could be found that any action was taken specifically in pursuit of the CIEX report,” said Mkhwebane.

Meanwhile, Mkhwebane announced on Monday that she would be opposing President Jacob Zuma’s application to review and set aside the damning “State of Capture” report compiled by her predecessor Thuli Madonsela.

“On the State of Capture report, the last time we met I said I was taking legal advice on the matter. Yes, we will be opposing the judicial review [sought by Zuma] application,” Mkhwebane told a press briefing in Pretoria.

“I think you know that we are still finalising the process of collating all the evidence which is needed. The [evidence] which the president required, we will avail in terms of the rules. We are still finalising the signature by the various counsel on the confidentiality clause. So we are at that stage.”

Zuma filed the application to review and set aside the report in the High Court in Pretoria last year. In his application before court, Zuma argues that the remedial action prescribed by Madonsela infringes on the separation of powers doctrine.

His lawyers contend that it was unconstitutional for Madonsela to instruct Zuma to set up a judicial commission of inquiry and to stipulate that it must be lead by somebody appointed by Chief Justice Mogoeng Mogoeng, as these powers are strictly vested in the president alone.

Madonsela found extensive indications that the Gupta family’s business empire has been given allowed to benefit from contracts with state enterprises, notably Eskom. She directed that a commission of inquiry be set up to continue the investigation, as her term of office was expiring.

– African News Agency (ANA)

Leave a Reply

Your email address will not be published. Required fields are marked *