The head of the National Intelligence Agency (NIA) in the Eastern Cape has been suspended following allegations that he solicited money from Cape-based mafioso Vito Palazzolo.
The NIA this week confirmed the suspension last month of Dumisani Luphungela, the agency’s Eastern Cape provincial manager, on ”allegations of corruption”. But representative Lorna Daniels added: ”We do not want to specify the nature of the allegations except to say that every avenue will be investigated.”
Luphungela, who was NIA deputy head in the Western Cape until late 2000, earlier served in a multi-agency team formed to investigate Palazzolo. It is not the first time allegations have surfaced that an improper relationship developed between the Sicilian-born businessman and an investigator supposedly on his trail.
The Mail&Guardian learnt this week that a private investigating firm founded by former national police commissioner Georg Fivaz had chanced on damning evidence against Luphungela while the firm was doing de-bugging work at a Franschhoek wine farm and mineral water business associated with Palazzolo.
The farm, La Terre de Luc, and adjacent mineral water plant, La Vie de Luc, earlier belonged to Palazzolo. Although he formally sold both to Italian playboy and former racing driver Count Riccardo Agusta, Palazzolo still helps manage the business side.
Leonard Knipe, formerly a police detective head and now a partner in Fivaz and Associates, this week said: ”We did work for Count Agusta on the property. With a de-bugging company we performed duties — we looked for bugs at the premises and the office complex of the mineral water plant.”
In the process, Knipe said: ”I might have become privy to certain information which was conveyed to the relevant authorities.”
Investigators, speaking on condition of anonymity, told the M&G that Knipe had chanced on ”evidence of a communication” in which Luphungela allegedly asked Palazzolo for about R10 000 to help pay for funeral expenses. From the context, the sources said, it appeared that Luphungela had a pre-existing relationship, possibly financial in nature, with the mobster.
One investigator said he had been ”surprised to learn” that Fivaz and Associates were ”involved in providing security to Palazzolo”, but praised Knipe’s decision to convey the information. Several sources said it was thought that Palazzolo did not object to the information being handed to the authorities. Palazzolo’s lawyer this week advised him not to comment.
Knipe is also the investigating officer in the fraud-and-theft trial of Andre Lincoln, the suspended head of the elite Presidential Investigation Task Unit. Although Knipe has left the police, he has been retained part-time by the state to help finalise the prosecution, which resumed this week. Lincoln’s unit was tasked by then-president Nelson Mandela in 1996 with investigating Palazzolo.
The prosecution’s case includes allegations that Lincoln maintained improper relations with Palazzolo.
After Lincoln was arrested in 1998, the probe into Palazzolo was taken over first by Piet Viljoen, the police captain who recently grabbed headlines with his arrest of German fugitive Jurgen Harksen, and then by a multi-agency team which included prosecution authorities, the Scorpions and the NIA. Luphungela, then still second-in-charge of the NIA in the Western Cape, was the agency’s representative on the team management.
The M&G understands that Luphungela cultivated close ties with Cyril Beeka, a Western Cape security company boss and underworld figure who has been described as Palazzolo’s ”lieutenant”.
Although Luphungela is said to have denied ”handling” Beeka as an informer, there is little doubt that Luphungela indeed had NIA authorisation to handle Beeka and that he indeed obtained some information from him. Investigators are concerned that Luphungela apparently maintained relations with Beeka after the need for it expired.
If indeed Luphungela had a corrupt relationship with Palazzolo or his associates, could it have harmed investigations into the mob? A partial answer may lie in the wealth of information to which Luphungela had access.
Said one insider: ”He was quite hands-on. He knew everything about anything [the multi-agency team members] were doing.”
Meanwhile, NIA representative Lorna Daniels this week confirmed a probe into allegations that NIA members had been involved in providing false identity documents to German fugitives associated with Harksen.
The M&G understands that investigators are looking at whether Luphungela was involved in this.
Allegations of NIA collusion were made early this month in a bail application by a German fugitive, Erwin Heldmann, after his arrest in Cape Town. Heldmann detailed an informal network of German fugitives living in South Africa, with Harksen as contact person. NIA members provided false identity documents, he claimed.
A prominent member of the German fugitive network, and an associate of Heldmann, is alleged to be former German junior defence minister Ludwig-Holger Pfahls. He has been wanted since 1999 by prosecutors in his own country on corruption and tax fraud charges amounting to about R20-million.
Only recently has it emerged that Pfahls may be resident in Cape Town.