/ 30 September 2005

Kebble hit the ‘perfect storm’

The future of investigations into Brett Kebble’s business and tax affairs by revenue authorities and the Scorpions is unclear following his murder on Tuesday night.

The National Prosecuting Authority announced on Thursday that it was dropping fraud charges against the mining magnate and empowerment financier relating to the apparent ­disappearance of R1,5-billion-worth of shares in Randgold Resources from Randgold & Exploration (R&E), a company he had controlled.

But probes into allegations of fraud and tax violations against Kebble and some of his associates are likely to figure prominently in the unravelling of the bleak circumstances that confronted him before his death.

Kebble had settled some of the tax claims against him, according to the South African Revenue Service (Sars), but a number of outstanding issues remained, and the revenue service will have an interest in his estate, along with other creditors.

Three sources familiar with the various long-running investigations into Kebble and his companies say Sars is likely to continue a fraud investigation of its own, in addition to its income tax claims.

But none of this will necessarily shed any light on the motivation for his murder.

Police investigators are stressing the possibility that he was the victim of a botched hijacking, and have leaked some information that tends to support that view. But people close to Kebble, including former judge and arms deal investigator Willem Heath, say they think the evidence points to a hit.

Asked if he would be conducting his own investigation, Heath, whose firm is employed by the family, said ”that isn’t necessary at this stage. But we will analyse the evidence the police gather, and make a decision based on that.”

Even before his murder, Kebble was at the centre of intense speculation as he tried to manage an increasingly complex set of commercial and political interests.

In recent years he had pushed his way to the centre of a perfect storm where the battle for control of the African National Congress vectored across the turbulent reorganisation of the troubled gold-mining industry, and corporate South Africa in general.

Empowerment imperatives, declining profitability at most mines, the brutal politics surrounding former deputy president Jacob Zuma, and former National Prosecuting Authority chief Bulelani Ngcuka, created a hugely complex environment of risk and opportunity, which he sought to take full advantage of.

Kebble had clashed publicly with Ngcuka and former justice minister Penuell Maduna — both prominent business figures now. He hired Heath to help defend him and his father, Roger, against what he suggested was a conspiracy involving police, the Scorpions and adversaries such as Durban Roodepoort Deep’s Mark Wellesley-Wood.

He also lent support to Ngcuka’s chief adversaries within the ANC: Zuma got access to Heath’s services, the ANC Youth League and some of its leading members got considerable financial support. Kebble even appears to have played a role in fostering the ”Africanist” agenda that has split the party in the Western Cape.

Questioned about the way he bankrolled individuals such as ANC MP Andrew Mlangeni, or pulled party figures — mostly those outside the top power structures at Luthuli House — into complex empowerment deals, he was unabashed.

He liked to argue that there was a battle under way for control of the economy, and that he was weighing in on the side of the angels, spreading the wealth where established capital, busily tying up deals with the party’s elite (including his former partner Mzi Khumalo), were afraid to tread.

Many of these deals — particularly those with companies and individuals drawn from the ANC Youth League, and its investment arm, Lembede — were hard to distinguish from fronting arrangements.

For example, as the Mail & ­Guardian reported last year, Itsuseng, a company financed by (then) Kebble-controlled JCI and owned by youth leaguers close to him, bought shares in Rand Leases, helping JCI to dodge the regulatory implications of buying the shares itself.

The company also used a R10-million loan from JCI to buy into the historic wine farm Boschendal.

But JCI later quietly took over Itsuseng and its assets, in an effort, Kebble said at the time, to help individuals such the youth league’s Lunga Ngcwana and Andile Nkhulu to build ”independent capital bases”.

Other structures, like the complex debt and equity structure that was intended to consolidate JCI’s empowerment assets in a new vehicle, Orlyfunt, ultimately came to look like empty asset juggling.

Some of those structures were already threatened following ­Kebble’s ouster from JCI, Western Areas, and R&E.

Whether they — and their beneficiaries — can subsist without him may be the truest test of Brett Kebble’s commitment to empowerment.