Ramatlhodi's lucky escape

Official documents obtained by the Mail & Guardian reveal the extent of the corruption allegations against former Limpopo premier Ngoako Ramatlhodi, highlighting how lucky he was not to be charged.

Ramatlhodi, an ANC heavyweight, was voted on to the national executive committee at number 20 and is 23rd on the party’s provisional list for Parliament. Only the Scorpions’ lengthy corruption probe stopped him being appointed national director of public prosecutions (NDPP) in 2005 and it is speculated that he is a contender again, or may be headed for Cabinet.

The Scorpions decided about a year ago to charge Ramatlhodi, but acting NDPP Mokotedi Mpshe overruled the decision in November after Ramatlhodi made representations to him and restarted a stalled high court application for admission as an advocate—the latter a prerequisite for the NDPP’s job.

The Scorpions’ probe started in 2004 after allegations that Ramatlhodi and his then finance MEC, Thaba Mufamadi, got kickbacks from the BEE partner of Cash Paymaster Services, which Ramatlhodi’s administration had contracted to manage social grant payments.

Mpshe’s decision not to prosecute followed consistent protestations of innocence from both politicians and others implicated. But evidence in Ramatlhodi’s case—and even his own admissions—reveal serious conflicts of interest, if not outright criminality. Documents obtained by the M&G include a 2005 question-and-answer exchange between the Scorpions and Ramatlhodi, which he appended to his renewed application for admission as an advocate, and a 2006 Scorpions court application for search warrants detailing their case against him.

R30-million profit
Central to the saga was Northern Corporate Investment Holdings (Nicoh), Cash Paymaster Services’ BEE partner, which profited by about R30-million from the grants contract between 2000 and 2003.

Nicoh was controlled by lawyer Solly Mohale and businessmen Gideon Serote, Haroun Moti and Habakuk Shikoane.]

Shikoane, Limpopo’s cane furniture king, became the Scorpions’ star witness, the search warrant application shows. He claimed in affidavits that Ramatlhodi had a hand in Nicoh’s formation. “Mr Ramatlhodi told us that he wanted us to form a company that could apply for tenders. I knew that this project would be a success because the premier himself initiated it.”

In his formal answers to the Scorpions Ramatlhodi denied this, but confirmed participating in a related initiative launched by ANC-linked company Thebe Investments.

Shikoane also claimed Ramatlhodi was a secret beneficiary of Nicoh, obtaining a regular percentage of payments to it. He handed over two hand-written “distribution lists”, indicating a 15% profit share for “Chief”, who he said was Ramatlhodi, over two months in 2001. Nicoh bank statements subpoenaed by the Scorpions for those periods showed payments according to the same percentages as those reflected in the lists. Ramatlhodi told the Scorpions Shikane’s claim was a “blatant lie” and he was “not acquainted at all” with “Chief”.

The Scorpions raided Nicoh co-stakeholders Mohale and Serote in 2004 and seized evidence, including further “distribution lists” similar to Shikoane’s, giving independent corroboration.

But the two challenged the warrants in court, which ordered the return of all evidence on technical grounds. In 2006 the high court authorised fresh seizures, but by this time the evidence was gone.

The Pumpkin Palace
The Scorpions did make progress on another front, however, in tracing actual payments. In two cases, money from Nicoh or Mohale helped Ramatlhodi buy property.

In 2000, Ramatlhodi bought the “Pumpkin Palace”, a mansion outside Tzaneen, for R1-million. Nicoh issued three cheques, totalling just more than R1-million, to local businessman Michael Toulou, who used one of the cheques, for R785 000, to open a money market account.

Soon after, a R500 000 bank cheque on this account was issued to a Tzaneen company called Magic Merkel Motors, owned by one Rayhaan Hassim, who paid a similar amount towards Ramatlhodi’s purchase of the mansion. Two more cheques from Toulou’s money market account, totalling R190 000, were used to pay for interior decoration at the Pumpkin Palace.

In his written explanation Ramatlhodi admitted asking Toulou to make the payments, but expressed surprise that the money came from Nicoh.

He said: “On inquiry it transpired that Mr Mohale owed Mr Toulou money which he paid out of his portion of the earnings of Nicoh.”

Cattle business
Ramatlhodi said Toulou advanced the R500 000 as a loan which he still intended repaying. Although there was no written loan agreement, Ramatlhodi said Toulou was looking after cattle belonging to him, which was his security.

The R190 000, he said, was in consideration for some of his cattle which Toulou had sold on his behalf. He admitted, however: “I have no documentary proof of the sale of the cattle.”

If Ramatlhodi’s explanation is true, it does not absolve him of a glaring conflict of interest: he admits a financial relationship with Toulou, but Toulou was a business partner as early as 1998 of Demetrios “Jimmy” Kourtoumbellides, a controversial Limpopo businessman who benefited from massive provincial property tenders, and Johannes Moolman, who chaired the provincial tender board that controversially re-awarded the social-grants tender to Cash Paymaster Services in 2002.

Ramatlhodi and his Cabinet appointed Moolman.

In 2003 Ramatlhodi bought another residential property, this time in Pretoria; R100 000 of the purchase price came from Mohale’s family trust.

In his answers to the Scorpions, Ramatlhodi did not dispute this, but said it was a “loan” from Mohale, a “family friend”.

He appended a purported copy of the loan agreement.

If true, Ramatlhodi’s explanation may relieve him of criminal liability. But the admission of a financial relationship with a man involved in a company re-awarded a lucrative tender by his administration less than a year earlier reveals another serious conflict of interest.

Sam Sole
Stefaans Brümmer

Stefaans Brümmer

Stefaans is an old hand at investigations. A politics and journalism graduate, he cut his reporting teeth at the Cape Argus in the tumultuous early 1990s; then joined the Mail & Guardian as democracy dawned in April 1994. For the next 16 years (a late-1990s diversion into television and freelancing apart), the M&G was his journalistic home and launch pad for award-winning investigations focusing on the nexus between politics and money. Stefaans has co-authored exposés including Oilgate, the Selebi affair, Chancellor House and significant breaks in the arms deal scandal. Stefaans and Sam Sole co-founded amaBhungane in 2010. He divides his time between the demands of media bureaucracy (which he detests), coaching members of the amaBhungane team, and his first love, digging for dung.
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