The legal consequences of cartel activity on the part of powerful players in the construction industry are dire.
("An uncivil battle", Business, February 15 to 21). Because fraud is involved, criminal prosecutions and jail time for those convicted is possible. Administratively, a breach of the competition laws leads to administrative penalties that run to potentially crippling millions of rands. Civilly, those who are the victims of the cartels have the option to cancel the affected contracts, reclaim money paid and claim damages.
Add to these the hits to the reputation, moral standing and investor-friendliness of the construction industry, and a truly toxic tincture confronts the authorities and those trying to make an honest living in the industry. It would seem that a mediated solution is preferable to letting the rules of the law and the economic and the moral ramifications simply take their course in separate silos.
It is not beyond the wit of the National Prosecuting Authority, the Competition Tribunal and representatives of those fleeced by cartels to fashion a holistic response to the problems posed. This is possible by appropriately mediating the catastrophic fallout of not adopting a co-ordinated and cohesive strategy to deal with the matter and those involved in wrongdoing of a criminal, administrative and civil nature.
Former cartel members can most advantageously be put to work to right the wrongs of the past. Constructing useful infrastructure at their own expense as a surrogate for punishment of more traditional kinds has the felicitous effect of improving the lot of the poor. Cartel members may be advised to take the initiative by offering to involve themselves in building schools, houses, roads and clinics in impoverished areas to compensate society for past wrongdoing. This could save some people from bankruptcy, spare others debilitating fines and create jobs.
Projects of this nature could be tacked on to existing work and included in new assignments. In this way economies of scale and logistical advantages can be harnessed. Corruption is theft from the poor. Let the punishment fit the crime. – Paul Hoffman, SC, director, Institute for Accountability in Southern Africa