/ 11 November 2007

Officials ‘siphoned off’ farmers’ billions

Top Land Bank officials have siphoned off more than R2-billion — meant for farmers — to fund their close friends’ and associates’ ventures, the Sunday Times reported.

The money was reportedly used for luxury golf estates, a sugar mill, equestrian estates and residential developments.

The fraud was revealed in a forensic audit by Deloitte, which was handed to the Cabinet this week by the Minister of Agriculture and Land Affairs, Lulu Xingwana.

It was reported that the extent of the fraud forced the Cabinet to call for the Land Bank board to be fired and for criminal charges to be brought against almost the entire top management, implicated in the investigation.

Xingwana is set to announce a new board this week.

The Sunday Times also claimed that the fraud has strained relations between Xingwana and her predecessor, Thoko Didiza, with Didiza believing the present minister is conducting a witch-hunt against her former employees and showing up her failures.

The Land Affairs Ministry said on Wednesday that the forensic audit report into the financial management of the Land Bank was, on the Cabinet’s recommendation, to be referred to the National Directorate of Public Prosecutions for “further investigation”.

The Cabinet also recommended that criminal proceedings be instituted against all those who were identified “as having personal interest, [and] acted inappropriately and negligently”.

Other Cabinet recommendations include that:

  • the Department of Agriculture and Land Affairs and the National Treasury cooperate closely in the process of turning the Land Bank around;

  • possible remedies for recovering “undue” benefits derived by third parties, as a result of the actions of the Land Bank’s management, be investigated;

  • internal disciplinary measures be taken against members who failed to act within the confines of their duties;

  • all the loans that have been written off be reviewed; and,

  • there be a major review of the Land Bank’s executive and non-executive management, including the composition and restructuring of its board.

The Cabinet recommendations were welcomed by the Democratic Alliance (DA).

“Cabinet’s decision to take further action in the Land Bank matter confirms what the DA has long since suspected: that Land Bank officials have been, and possibly still are, involved in irregularities and that the National Prosecuting Authority must now investigate the matter further,” DA agriculture spokesperson Kraai van Niekerk said in a statement on Wednesday.

The Land Bank, once financially healthy, has been forced to its knees and a serious attempt to save it is necessary, he said.