How dirty is Godongwana’s laundry?

Deputy economic development minister Enoch Godongwana and his wife, Thandiwe, will be called to appear before a liquidation inquiry into a company, in which they hold a 50% stake, that was given R93-million in a controversial loan.

About R19.8-million of that loan came from a fund holding textile workers’ pensions.

The inquiry into the company, Canyon Springs Investments 12, will be held in camera in Cape Town between Tuesday and Friday next week, the liquidator’s assistant Muller Terblanche confirmed.

After Godongwana set the company up, a loan of R19.8-million of clothing worker’s pension fund money was arranged, according to papers submitted in court.

Although more than 20 000 clothing workers belonging to the the South African Clothing and Textile Workers’ Union (Sactwu) are still waiting to hear whether they will get their money back, Terblanche said the decision to hold the liquidation inquiry in camera was not an attempt to cover up the proceedings.

“In the beginning we call witnesses who will give us background and then we get everybody in,” explained Terblanche. “We don’t have a schedule of people appearing before the inquiry.”

Godongwana confirmed his family owned 50% of Canyon Springs, while the families of alleged loan facilitator Richard Kawie and company director Mohan Patel held the other half through family trusts.

While the minister claimed he did not know the loan had come from clothing workers’ pensions, this was contradicted by Trilinear Capital, the black empowerment asset management company that invested the money.

Trilinear’s attorney Chris Briston last month told the Mail & Guardian that Godongwana was involved in arranging the loan and had known where the money came from. More light is expected to be shed on the controversy during the inquiry.

The liquidators have attempted to bring Kawie before the inquiry but this week claimed they had not managed to trace him. Forensic lawyers involved in the case believe he may have left the country with his Swedish wife and their children.

Kawie’s Johannesburg-based lawyer Vlad Movshovich said he would be speaking to his client to find out if he would appear before the inquiry.

Patel resigned as a director of the company but has been assisting in providing lawyers working on the case with information.

Tereblanche said offers had been made to buy one of the company’s subsidiaries, Pan African Benefit Services, which offers actuarial, administrative and consulting services to pension funds.

“There are a couple of people interested in Pan African Benefit Services,” said Terblanche. “No decisions have been made yet, but for us to sell the subsidiary and recover union funds would be a priority, and could take away a lot of the pressure.”

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Glynnis Underhill
Glynnis Underhill has been in journalism for more years than she cares to remember. She loves a good story as much now as she did when she first started. The only difference is today she hopes she is giving something back to the country.

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