Trifecta's kickback circle extends beyond Northern Cape
The property company exposed by the Mail & Guardian two weeks ago for apparently giving kickbacks to parliamentary committee chair Yolanda Botha has also paid other well-connected figures to get government business.
Botha chairs the social development portfolio committee in the National Assembly and is also the ANC’s Northern Cape provincial secretary.
Now, documents seen by the M&G suggest that Trifecta’s generous treatment of Botha was part of a concerted modus operandi involving other well-connected figures in several provinces.
The politicians include two more of the ANC’s top provincial leaders in the Northern Cape, John Block and Alvin Botes, as well as the ANC’s provincial secretary in KwaZulu-Natal, Sihle Zikalala.
Trifecta paid Block, Botes and Zikalala to conduct business on its behalf and, according to Trifecta’s former accountant, their primary role was to use their political influence to secure lease agreements.
Botes and Zikalala have accepted that they received benefits from Trifecta but denied they were paid to influence tenders or that they were in a position to do so.
Block declined to comment.
Trifecta also appointed Nomahlubi Mbeki—a beauty queen and the niece of former president Thabo Mbeki—as a director of several subsidiaries.
Mbeki appears to have been a means for Trifecta to manipulate its black economic empowerment credentials when applying for government tenders.
She was issued shares, but Trifecta ensured the shares could revert to the company if it chose.
Mbeki said that she had not yet successfully concluded any rental agreements with government departments.
Trifecta’s approach to doing business with government is revealed in six files of documents that a former employee gave the M&G access to last week.
Magdalena Buizer was Trifecta’s accountant from 2004 until she opted for a constructive dismissal in March last year.
She was privy to the company’s financial records and was familiar with its inner workings.
Buizer said Trifecta director Christo Scholtz “always said that we would use politicians higher up in the ranks for their influence to get lease agreements signed”.
Scholtz told the M&G that Buizer’s allegations were “false”, “malicious” and that she “always fabricated ‘kooperasie stories’ [and so] was not entrusted with information ... that did not form part of her duties”.
“Buizer’s perception that a person can facilitate rental agreements with government organs is a false perception which she carries over to mislead other people,” Scholtz said.
Scholtz laid charges of theft against Buizer this week, although Buizer had already handed over the documents to police investigating Trifecta.
Meanwhile, the chair of the parliamentary committee that monitors members’ interests, Ben Turok, said that processes were now “well under way” to determine whether Yolanda Botha had violated the members’ code of conduct by not declaring the benefits she received from Trifecta.
Turok declined to comment further, saying “this is very sensitive stuff, where lawyers get involved”.
Hawks spokesperson Mackintosh Polela said police were also investigating the matter.
Controversial Northern Cape ANC chairperson John Block’s dealings with Trifecta have been reported previously by the M&G.
A former close friend of Block said Block had used his position as ANC chair in the province since 2005 to glean commercial intelligence.
According to Buizer, Trifecta hired Block between 2006 and 2009 to be a “facilitator” with the appropriate government department in transacting lease agreements.
“A facilitator was used to negotiate the rental agreement between the lessor [Trifecta] and the lessee [government] ... basically they would use their influence to ensure that the tenders were awarded to Trifecta,” she said.
Buizer said Block facilitated rental agreements between Trifecta and the South African Social Services Agency, as well as the departments of agriculture and sport worth hundreds of millions of rands.
Previously, the M&G put the total benefits Block received from Trifecta at R2.2-million.
This included a basic salary of R60 000 a month for 24 months and “consultation fees” totalling R800 000.
The M&G has also reported that Block received a R650 000 makeover to his guesthouse in Upington, courtesy of Trifecta.
Now the M&G can reveal that Trifecta also paid Block’s legal fees of R338 000, relating to the fraud charges he faced in 2006, bringing the total value of benefits he received from Trifecta to more than R3-million.
Scholtz said his co-director, the late Sarel Breda, employed Block as a consultant “to assist in creating a resources company as part of the Trifecta family of activities” and not to facilitate property rental agreements.
However, the sole mining right Trifecta acquired was later relinquished after a lengthy court battle and it remains unclear why Block received upwards of R3-million for failed mining consultancy work.
Alvin Botes is a close political ally of John Block, having been elected to the ANC’s Northern Cape provincial leadership as deputy secretary on the same slate in 2008.
The M&G described Botes, while campaigning for Block in his then-capacity as Northern Cape ANC Youth League chair, as Block’s “stormtrooper-in-chief in the province”.
Buizer said Botes was hired by Trifecta to facilitate property rental agreements with the department of social services and population development.
Documents show that Trifecta paid Botes a monthly salary of R25 000, totalling R900 000 between 2006 and 2009.
In addition to his salary, Botes’s family trust was allocated a 10% stake in Trifecta subsidiary Green Marble Investments 3 in October 2008.
Social services signed five leases with Trifecta during this period, worth a combined R64-million.
Botes said: “I have never been tasked by Sarel [Breda] to engage in any matter of contract facilitation ... with social services.”
He said he was employed and paid by Trifecta to be an “adviser” to his friend, Trifecta director Sarel Breda.
As Breda’s adviser, Botes said his role was “to provide mentorship with regard to his personal life [and] building a cohesive and healthy family nucleus, [as well as] strategic advice
on youth empowerment initiatives he intended to undertake”.
Buizer observed: “Since when does one go on to the payroll for that [mentorship]? Surely, true friends do that for one another without being compensated?”
Breda, whose Shosholoza Trust owned 55% of Trifecta, died in a plane crash near Kimberley in March 2009.
Botes said that he stopped receiving a salary from Trifecta after Breda’s death.
Botes is now MEC for social services in the province.
With regard to his family trust in Trifecta, Botes said: “I have ... advised that the enterprise must have absolutely no relationship with the Northern Cape government.”
However, Green Marble Investments has acquired a R3.5-million building in Welkom, which it is in negotiations to lease to the Free State department of education.
As the ANC’s provincial secretary in KwaZulu-Natal, Zikalala is on an equal footing politically with the likes of Botha and Botes in the Northern Cape.
Trifecta paid him a total of R100 000 in ad hoc instalments between August and December 2008, after which he received a monthly salary of R50 000 until April 2009.
“He was employed to facilitate lease agreements in KwaZulu-Natal, which I don’t think he did, but he was asked to negotiate the Welkom lease with the education department,” Buizer said.
She pointed out that Zikalala was the only politically connected “facilitator” to insist on an employment contract: “At that stage we did not give contracts because we did not want people to make the connection [between the politicians and Trifecta].”
Zikalala said he was approached by Breda as “a personal friend ... to extend the business of his company”.
His letter of appointment describes his work as “contract liaison, lease acquisition and project manager”. Buizer said this was a similar role to that played by Block and Botes.
Asked to clarify what his job entailed, Zikalala said: “I reviewed government and provincial government tender bulletins in order to ascertain if they needed office accommodation.
“I attended the briefing sessions, gathered the relevant information, assisted with the completion of tender documentation [and] when required, obtain[ed] clarification on questions relating to the tender between the company and the relevant department.”
Zikalala said that “it was not possible to facilitate rental agreements with government ... tender processes do not follow facilitation” and that, at the time, he was “not holding any full-time position in the ANC”.
But Zikalala, a former ANC Youth League provincial secretary, replaced Mbuso Kubheka as the ANC’s deputy secretary in the province in June 2008.
Trifecta began paying him in August.
It is still not clear why Trifecta paid a powerful political figure a substantial salary to do the work of a clerk if he was not also expected to use his political connectedness to get business for the company.
Scholtz said that Breda hired Zikalala because the company was “running out of man-hour capacity” in its attempt to form an entity in which “a broader base of BEE participants can partake”.
Like Botes, Zikala’s family trust was allocated a stake in Green Marble Investments 3.
Zikalala has played an active role in ongoing attempts by Trifecta to lease Green Marble’s R3.5-million Welkom asset to the Free State education department.
Neither Scholtz nor Mbeki have offered an alternative explanation to the suggestion by Buizer that Mbeki is a BEE front for Trifecta.
Mbeki holds 100% of Trifecta subsidiary Congrezest, but the M&G has seen two undated share transfer forms signed by Mbeki that allocate her 100% stake in Congrezest back to Trifecta.
“These forms were not issued at the time [she signed them], but were kept in trust by Trifecta. Once the tenders are awarded and the lease contracts [with government] are in place, they just switch CM42s and all the shares are Trifecta’s,” Buizer alleged.
In January 2010 Congrezest bid for 19 tenders to provide office space to nine government departments in the Eastern Cape.
It is unclear whether the company was awarded any of the tenders. Attempts to get clarity from the provincial public works department were unsuccessful.
Mbeki did not respond to written questions about her role in Trifecta, but told the M&G: “You are jumping the gun ... none of those companies have done any business with government.”
But Buizer said: “The point here is not that tenders were awarded or not: the point is that the tenders were submitted to government in an act of premeditated deceit.”
This article was produced by amaBhungane, investigators of the M&G Centre for Investigative Journalism, a nonprofit initiative to enhance capacity for investigative journalism in the public interest. www.amabhungane.co.za.