Reserve Bank guns for Mkhwebane and her CIEX delay attempt
Public protector Busisiwe Mkhwebane faces a bruising day in court on Friday, if papers from the Reserve Bank are anything to go by.
Mkhwebane’s legal team is due to ask for a long postponement before she is ready to defend her CIEX report on an apartheid-era lifeboat for a precursor to Absa, in which she infamously unilaterally changed the Reserve Bank’s mandate in the Constitution.
But in a blistering reply to the application, the Reserve Bank on Monday tore into Mkhwebane in a manner that bordered on the personal.
“She clearly does not appreciate the impact of her conduct,” Reserve Bank lawyer Corlett Manaka said of Mkhwebane’s approach. “This is not conduct befitting an organ of state in litigation.”
Mkhwebane issued her report on the Apartheid-era CIEX bailout in June, instructing the Special Investigating Unit to start proceedings to recover R1.125-billion in what she considered ill-gotten gains from Absa. She also instructed Parliament to remove the Reserve Bank’s mandate to target inflation. Both banks, as well as the treasury, reacted furiously, accusing Mkhwebane of risking financial stability while radically misunderstanding the evidence before her and the issues at play.
The banks’ challenge to the report had been due to be heard in early December. But on Friday Mkhwebane will formally apply for a three month extension, which the Reserve Bank believes will push the matter well into the second half of 2018—a year after the report was first issued.
According to the Reserve Bank, Mkhwebane has failed to properly explain why she would need that extension — and what explanation she has offered is misleading.
In her application Mkhwebane decries the vast amount of paperwork involved in the matter. Yet “her count is wrong and misleading,” said Manaka on Monday, detailing how Mkhwebane’s numbers simply do not add up, and in some instances refer to documents she relied on in compiling her report, and so presumably are familiar with.
“The public protector’s claims about the volume of papers in this case is grossly exaggerated,” said Manaka.
Mkhwebane cited the paperwork in the context of the amount of work that had to be done by her new legal team, appointed in October after her previous team failed to secure a postponement of the matter well into 2018.
However, when asked about the circumstances of their appointment and what work they had done to date, Mkhwebane’s new legal team invoked legal privilege.
In an affidavit, Mkhwebane also said she requires time to talk to “consultants that help me understand the complex details of the financial markets, including but not limited to the role of central banks”—a role she traversed in her June report.
The Reserve Bank has argued that the report amounts to a sword hanging over its head, which influences markets. Absa has previously said it continues to suffer harm to its reputation as long as the report has not been set aside. Mkhwebane, on the other hand, is due to argue that it would not be in the public interest for her to go to court ill prepared in December.