Tax authorities have laid a fresh criminal complaint against their biggest target, controversial billionaire Dave King, following an investigation which appears to link him to the network surrounding Glenn Agliotti, the man charged with the murder of Brett Kebble.
The South African Revenue Service (Sars) has been battling for eight years to get King to pay R2,3-billion in taxes and penalties. Sars has now asked the police service’s Serious Economic Offences Office to look into allegations that King procured a fraudulent document purporting to settle the claims for just R300-million and that he may have attempted to influence a senior tax official.
King, who launched a publicity offensive this week arguing that Sars has abused its powers, insists the document is a genuine contract and says he intends to hold commissioner Pravin Gordhan to it.
King has denied paying for help from Agliotti in solving his tax problems and Agliotti himself has stated under oath that he offered his services to King, who did not take him up.
”Sars wants to contaminate me with the link to Agliotti,” King told the Mail & Guardian.
Associates of Agliotti appear to have introduced King to Sars general manager of customs Leonard Radebe.
King claimed this week that it was Radebe who had negotiated the contested settlement.
Radebe quit the revenue service ahead of pending disciplinary action last month after it emerged that he had a meeting with King at a Johannesburg restaurant.
According to people familiar with the internal processes at Sars another senior tax official visited Casalinga restaurant in Muldersdrift, where a waiter remarked, ”you Sars people really like this place, Leonard Radebe was here just yesterday with Dave King”.
Radebe was questioned about the meeting and provided an affidavit outlining his version of events. This formed the basis for the internal investigation at Sars.
”I resigned because I wanted to protect the reputation of Sars and because it was the honourable thing to do,” Radebe told the M&G.
Radebe conceded that he had met Agliotti socially, but flatly denies negotiating the settlement, writing it up or authorising it.
He had since been approached by Serious Economic Offences Director Danie Kriel, he said, but had decided not to cooperate after Kriel informed him that he was being treated as a suspect and potentially facing charges of fraud and corruption.
Radebe told the M&G he had been introduced to King by acquaintance Jacques Nel, whom he had met some years before in Durban. At the time Radebe was a fast-rising regional manager in the customs branch.
Nel, a former policeman, is described as ”extremely close to Agliotti” by independent sources familiar with the King investigation and with Scorpions investigations into the criminal networks surrounding Agliotti, security company boss Clint Nassif and the Kebble empire.
”He is probably the most frequent visitor at Glenn’s house,” said one such person, ”he does most of the legwork for him now that Glenn is under protection.”
Nel is also associated with King, has visited his Plettenberg Bay home and has told law enforcement officials that he ”acts for King”.
Radebe insists that Nel was his main contact with Agliotti and King.
”I have met [Agliotti] but I don’t really know him. I dealt with Nel. If you look at my phone you will see that I don’t have numbers for any of them except Nel.
”These people have created the impression that they know me and have influence with me – and they have probably done it not just with King, but with others,” Radebe said, adding that he thought he had been identified and cultivated as a ”friend” by Nel for this purpose.
King insists that he negotiated in good faith directly with Radebe and that Radebe’s seniority as well as the authorisation process involved in any settlement would have precluded fraud.
”People do not understand that I am not dealing with Nel, but dealing with a serious number two at Sars [in Radebe].”
King says it was Radebe who mooted a settlement of R300-million. He suggests that Radebe may have misinterpreted a mandate given to him by Gordhan. Alternatively, he suggests, the commissioner ”changed his mind” after the agreement was signed or did not believe Radebe had negotiated for enough money.
Radebe dismisses this account. ”King is talking bullshit,” he told the M&G.
King says that Nel visited him in Plettenberg Bay only after Radebe was suspended, adding that the visit was business ”on the back of the agreement” and not because he was a household friend or ”anything like that”.
He also says he was not disturbed by a requirement that he pay the R300-million up front – which he did not do – to a Germiston law firm, rather than into the trust account ordinarily used by Sars. This was because the firm’s representative was a former Sars employee, and furthermore, King says, he asked Radbebe to provide a letter from Sars confirming that payment should be made into the new account.
Radebe believes the saga has destroyed his chances of replacing Gordhan as commissioner. ”If they wanted to look at an African I am the one on the executive committee with the most background, but I am out now,” he said.
”We became aware of the link between King and Radebe and immediately suspended Radebe,” Sars spokesperson Adrian Lackay said. He declined to comment further.
Nel could not be reached for comment.
The king primer
Dave King came to the attention of the South African Revenue Service (Sars) in 2001 when an auditor, Mr Chips, read press reports of R1-billion in profits King had earned from the sale of shares in his company, Specialised Outsourcing (Outsors).
In 2002 King was presented with two tax assessments totalling R2,3-billion,including penalties and interest. The first, for R900-million, was based on King’s lavish lifestyle. The second, for R1,4-billion, was based on the assets of an offshore company, Ben Nevis, set up by King to house the proceeds of the share sales. Sars has been battling King since, but he insists his offshore structures were legitimate. At a press conference on Tuesday he laid into what he said were errors in Sars’s tax assessment, the abuse of the Scorpions as a ‘debt collector†and the ‘bad faith†of commissioner Pravin Gordhan. The process had been replete with bias, he suggested.
King disputes the assessment against him in his personal capacity, saying Sars has alternated between saying the jets and fancy cars were effectively owned by him and saying they were used by him as fringe benefits. This amounts to perjury, he claims: ‘The commissioner did not hesitate to mislead the court to suit whatever short-term outcome was required.â€
The assessment for Ben Nevis, he argues, wrongly treats tax exempt capital gains from the share sales as revenue. Sars counters that King has repeatedly lied about the ownership of his assets and points to documents showing that Ben Nevis and other structures were set up specifically to hide the proceeds of share trading.
Sars insists it is King who is delaying a resolution. ‘King has consistently, through delaying tactics, avoided the courts. He has delayed matters in the tax courts. He has continuously delayed the criminal trial. Sars challenges Mr King and Ben Nevis to have their tax appeals enrolled and heard immediately,†the tax authority said in a statement.
