Turmoil has enveloped the top echelons of fuel parastatal PetroSA, with three top executives being suspended last week and then reinstated this week. The Mail & Guardian understands that they are not yet off the hook.
PetroSA chairperson Popo Molefe is believed to have led a charge to suspend chief executive Sipho Mkhize, chief financial officer Nkosemntu Nika and operations vice-president Michael Nene for irregularities uncovered in an investigation by Gobodo Forensic & Investigative Accounting. Gobodo was probing tender-rigging, financial mismanagement and the alleged disappearance of funds from Petro-SA’s captive insurance account.
It appears that Molefe failed to follow the required procedures for the suspension of the executives and did not consult all board members before taking action. However, it is understood that the board will deal with the charges against the trio in the near future.
In an internal memo to staff Molefe confirmed that an investigation had taken place and that the board had been presented with a report. ‘The board directed the chairman to initiate processes of assisting [it] to appropriately respond to the report,” he said in the memo.
PetroSA refused to comment on whether any suspensions or reinstatements took place this week, or on the progress of the Gobodo investigation. By Thursday Mkhize had returned to work, whereas Nene and Nika remained in their offices all week.
A source said the three had not fully cooperated with investigators, withholding certain documents requested of them. It is understood that Gobodo has not yet compiled the final report. but that it had reported to Molefe what had been uncovered. He then took action.
Sources said the executives hit back at a marathon board meeting this week, where they succeeded in having their suspensions overturned. Unconfirmed reports suggested, however, that although Nika and Nene had managed to escape suspension for now, Mkhize is still in the firing line.
Political motives may also be at work: Mkhize had close links with former deputy president and minerals and energy minister Phumzile Mlambo-Ngcuka. There have been suggestions that he is close to the Congress of the People.
Molefe was out of the country when the M&G tried to contact him. Non-executive board member Mohamed Yusuf Kajee refused to comment on the board meeting, beyond confirming that it took place.
The PetroSA board commissioned the investigation after M&G and Financial Mail reports on irregular activities at the parastatal last year. A source close to the investigation said that Gobodo investigated the three executives’ shareholding in firms linked to tenders, as well as wasteful expenditure.
The parastatal’s former chief risk and compliance officer, Lerato Lesole, is understood to have been one of the whistle-blowers who assisted Gobodo. Lesole was fired after beginning his own investigation, based on the claims by an internal source in 2007 that Nika could be involved in fraud and that Mkhize was involved in tender irregularities relating to the desludging of PetroSA’s Milnerton oil tanks.
He also investigated whether executives were dipping into Petro-SA’s Isle of Man captive insurance account. Lesole sued PetroSA for wrongful dismissal, but lost his Labour Court case in January this year.
In his court papers he wrote at length about how Nika and Mkhize had interfered with his investigation. In an interview last year with the M&G Lesole also questioned Mkhize’s links to Cope members and whether the party was benefiting from ‘dodgy” deals.
The Gobodo investigation also apparently covered allegations that executives were running up exorbitant expenses.