/ 11 September 1998

MEC tight-lipped over promissary notes

JUSTIN ARENSTEIN, Nelspruit | Friday 2.30pm.

MPUMALANGA finance MEC Jacques Modipane on Friday again refused to explain why he failed to warn the Reserve Bank or any other government fiscal body about an illegal R500-million offshore loan deal entered into by the Mpumalanga Parks Board (MPB) last year.

Modipane conceded that the International Bank of Southern Africa tipped him off about the deal in February but repeatedly refused to comment further.

A series of promissary notes allegedly issued by MPB chief executive officer Alan Gray offered put up some of the province’s flagship reserves as collateral for an off-shore loans to bolster his cash-strapped parastatal.

The R500-million loan scheme with Pacific Bullion International is the first of four suspected illegal promissory note issued by the MPB.

Neither Modipane nor his acting departmental head, Sam Cronje, would explain why no record exists of a supposed internal investigation they conducted into the scheme.

The illegal deal with Pacific Bullion International was clinched in December without the necessary ministerial or Reserve Bank approval, but was cancelled in March after the brokerage failed to make any of its promised R50-million a month payments to the MPB.