Sol Kerzner has severed his links with his South African business just as a police investigation into alleged corruption draws to a close. Louise Flanagan reports
UNTOUCHABLE Sun King Sol Kerzner withdrew from his South African company this week as an eight-year-long criminal investigation into allegations of corruption against him drew to a close.
Kerzner resigned as chairman of Sun International (Bophuthatswana), the main Sun International (SI) operation which runs Sun City, in favour of foreign interests. SI has 17 resorts in South Africa and 11 more in France, the Caribbean, the United States and Indian Ocean islands.
Since 1987, the Transkei police and later the Port Elizabeth police have been investigating charges against Kerzner in connection with the payment of a R2-million bribe to former Transkei ruler Chief George Matanzima.
The payment, which Kerzner admitted to the Harms Commission, was made to secure sole gambling rights in the Transkei. Some years later, a Supreme Court judgement and a subsequent military government decree overturned these rights, limiting SI to sole rights in only a section of the territory.
Kerzner has appeared untouchable in the matter of the criminal investigation. The former Transkei government tried unsuccessfully for years to have him extradited. In December last year, President Nelson Mandela’s office dismissed speculation that a secret deal had been made to help Kerzner avoid prosecution.
This week, police said a decision on whether to prosecute Kerzner would be made soon. “I think there’s enough grounds to make a decision,” said Captain Andr Heunis of the Port Elizabeth fraud squad. The matter will be referred to the Umtata Attorney-General.
Kerzner has retained high-level connections in both the previous and current governments. He was a friend of former Bophuthatswana president Lucas Mangope, in whose territory he made the foundations of his fortune, the Matanzima brothers in the Transkei, and the late Ciskei ruler, Lennox Sebe. He attended Deputy President Thabo Mbeki’s 50th birthday party and was an honoured guest at Mandela’s inauguration last year.
Kerzner’s company appears to have used unorthodox ways of securing gambling rights in the Ciskei and Transkei.
In February 1987, military intelligence officer Brigadier Marthinus Deyzel and Western Cape businessman Tonie Botha approached then Ciskei president Lennox Sebe to discuss the carving up of gambling rights in the territory. Around the same time, Botha, Deyzel and the Jalc companies set up a scheme to use Jalc as a front company for military intelligence, using Jalc to gather information in the homeland states and neighbouring countries.
Botha, Deyzel and Sebe negotiated a three-way split of gambling rights in the Ciskei between the homeland government, SI and Lenton Investments (Ciskei), in which Jalc had an interest. Justice Louis Harms later found that Lenton received gambling rights from the then Ciskei government “valued in excess of R20-million in return for something which could not be explained.”
Just two months after Ciskei handed over the gambling rights, SI executives moved into Lenton as directors and by January 1988 Lenton was an SI subsidiary. Jalc director Chris van Rensburg was apparently still involved with Lenton years after SI took it over as he signed a Lenton document in July 1991.
The Harms inquiry was later told that those involved in this deal boasted that Sebe had fallen for it “hook, line and sinker”.
SI always employed people who were politically acceptable to the governments of the day. In 1990, SI (Ciskei) was set up with top executives of Ciskei People’s Development Bank among the directors. By early 1995, prominent Eastern Cape ANC members and Kagiso Trust regional director Glen Thomas had been made directors.
Last month it emerged in KwaZulu-Natal that a new gambling consortium, Africa Sun International, in which SI is involved, is linked to people close to the provincial government. They include Mangosuthu Buthelezi’s son “Zuzi”, Finance MEC Snezele Mhlungu, ANC stalwart Walter Sisulu and former aide to FW de Klerk, Richard