Gold Fields deal: Key witness 'recants'

Gold Fields itself commissioned the controversial report. (Courtesy of Gold Fields)

Gold Fields itself commissioned the controversial report. (Courtesy of Gold Fields)

The key witness behind a New York law firm's finding that mining house Gold Fields "bribed" ANC chairperson Baleka Mbete claimed this week that the lawyers had misquoted him, upping the ante in a high-stakes contest of truth versus reputation.

The witness, President Jacob Zuma's one-time lawyer Jerome Brauns, this week gave an account of the interactions that preceded Gold Fields increasing Mbete's stake in a contentious 2010 empowerment deal by R25-million. Brauns was one of the empowerment consortium's chief architects

This account, which followed the ANC lashing out in Mbete's defence, exonerates both the mining company and the party chairperson.

Read more:
Editorial: Gold Fields deal tarnishes BEE
Gold Fields: Jerome Brauns versus Paul Weiss
Mbete looks out for number one
Mbete's man 'threatened mayhem'

However, the law firm's investigation builds a compelling case that anti-bribery laws were breached by relying on the "unequivocal" version it says it got from Brauns in two detailed interviews lasting hours.

In a slide presentation to the Gold Fields board last month, the law firm Paul, Weiss, Rifkind, Wharton & Garrison (Paul Weiss) quoted Brauns in detail on points he now denies, bolstering that version by referring to documents and circumstances.

The Mail & Guardian reported last week that the Gold Fields board buried the Paul Weiss findings by deciding not to have the presentation reduced to a written report and by not heeding the advice to "self- report" the matter to the authorities. Gold Fields denied a cover-up, saying its board acted "deliberately … and in full compliance with the law".

Further questions are raised over Brauns's present version by an allegation that Gold Fields management had proposed a multimillion-rand payout to him following Paul Weiss's presentation of his allegedly damming testimony.

Brauns denied he "has been influenced by money", and Gold Fields declined to comment.

Mbete has not commented to date.

In a week of drama following the M&G's exposé of the "bribe" last week:

  • The ANC on Tuesday slammed the M&G for its "sensational, defamatory and slanderous" story, claiming the paper "will stop at nothing to discredit the ANC and its leaders";
  • Gold Fields, which has a secondary listing in New York, issued a regulatory announcement saying the United States Securities and Exchange Commission had initiated an investigation against it;
  • Gold Fields on Wednesdasought to prevent the M&G from publishing details of the Paul Weiss slide presentation by demanding in a lawyer's letter that the paper must not publish "privileged communication" and return copies; and
  • Brauns on Thursday offered his version, contradicting what he is quoted as saying in the slides.

He in effect accused the law firm of lying and having ulterior motives, saying in a written response: "I deny ever having said what the investigators is attributing to me regarding Ms Baleka Mbete.

"In fact, it is so far off the mark that I can confidently say that they were being deliberately mischievous in order to create sensation where none had been forthcoming from their investigations.
It leaves one to wonder what their true motives were when conducting the investigations."

Paul Weiss, which was appointed by Gold Fields itself following allegations of influence-peddling in the empowerment transition, had not replied to Brauns's allegations by the time of going to print.

AmaBhungane understands from a source close to the events that, during the time last month when the Gold Fields board considered the Paul Weiss findings, chief executive officer Nick Holland suggested to his colleagues that R7.5-million be paid to Brauns as early redemption of a right that Brauns had in respect of the BEE transaction.

This apparently raised eyebrows, as the Paul Weiss presentation had portrayed Brauns as the key witness in potential criminal proceedings against the firm under the US Foreign Corrupt Practices Act.

A Gold Fields spokesperson said in response: "The company (and Nick Holland) cannot comment."

Brauns said: "I deny this categorically. I have had no such discussion with Nick Holland. I recounted to you my version of events and dismiss with contempt any suggestion by you that my response to you has been influenced by money. Your insinuation is close to being defamatory."

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The M&G Centre for Investigative Journalism (amaBhungane) produced this story. All views are ours. See for our stories, activities and funding sources.

Stefaans Brümmer

Stefaans Brümmer

Stefaans is an old hand at investigations. A politics and journalism graduate, he cut his reporting teeth at the Cape Argus in the tumultuous early 1990s; then joined the Mail & Guardian as democracy dawned in April 1994. For the next 16 years (a late-1990s diversion into television and freelancing apart), the M&G was his journalistic home and launch pad for award-winning investigations focusing on the nexus between politics and money. Stefaans has co-authored exposés including Oilgate, the Selebi affair, Chancellor House and significant breaks in the arms deal scandal. Stefaans and Sam Sole co-founded amaBhungane in 2010. He divides his time between the demands of media bureaucracy (which he detests), coaching members of the amaBhungane team, and his first love, digging for dung.
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