Mkhwebane's 2017 report, which separately recommended a review of the Reserve Bank mandate, caused market jitters with a R1.3-billion sell-off in government bonds, according to Hofmeyr's submission. (Madelene Cronje/M&G)
An intervention in the court proceedings between the public protector and Absa has now brought a new request: that public protector Busisiwe Mkhwebane should investigate and recover missing billions from other apartheid-era crimes mentioned in the Ciex report.
Hennie van Vuuren, the director of Open Secrets, a non-profit that aims to expose apartheid-era financial crimes, filed an affidavit in the Pretoria high court to intervene in Absa’s application to review and set aside portions of the public protector’s report into the “lifeboat” ordeal.
In his affidavit, Van Vuuren urged the court to not “close the door to the future investigation and remediation of these crimes”. He argues that the Ciex report made claims that other institutions were guilty of economic crimes when they aided the apartheid government to bust United Nations sanctions to keep the apartheid economy alive. These institutions include:
- Sanlam and Rembrandt (now split into Remgro and Richemont) – R3-billion to R6-billion
- Daimler Chrysler – up to R5.5-billion
- Nedbank – R500-million
- Armaments Corporation of South Africa (Armscor) – R14.4 billion
While Mkhwebane “confined” her investigation to Absa and the Bankorp “lifeboat”, Van Vuuren says that her office was obligated to investigate all alleged crimes mentioned in the Ciex report. Her remedial action, however, stated that the Special Investigating Unit would be tasked with investigating the “other institutions” alleged to have misappropriated public funds in the Ciex report.
“In doing so, however, the public protector has inappropriately delegated the authority granted to her in terms of the Public Protector Act,” Van Vuuren says in his affidavit.
“Hence the matter should be remitted for the Public Protector to fully investigate the actors listed in the Ciex report involved in apartheid-era economic crimes,” he continues.
He has asked that the public protector deal with whether the funds alleged to have been “misappropriated” by these institutions can be recuperated and how that would happen.
Van Vuuren has written extensively on sanction-busting activities during apartheid in his book Apartheid Guns and Money, published earlier this year. In his court papers, he draws from research done for the book to emphasise the necessity of an investigation into apartheid-era financial crimes.
In one instance, Open Secrets found in declassified military documents that Armscor, a state-owned arms procurement agency for the SA defence force, has faced legal action since 2008 from a Portuguese national Jorge Pinhol who claims the agency owes him €192-million.
“Mr Pinhol alleges he is owed this money for acting as a middle person for the for the sale of arms between Armscor and the European arms producers during apartheid,” van Vuuren says.
If the courts find Pinhol’s claim is true, it would leave the South African government liable for billions. Pinhol and Armscor’s activities were flagrant violations of the UN economic and arms sanctions against the apartheid government. Pinhol is alleged to have helped import 50 Super Puma helicopters from France through Portugal.
“I submit that the irony of the fact that a non-segregationist government could be held liable for the costs incurred by the apartheid government whose objective was to effect segregationist and oppressive policies should not go unnoticed and unaddressed,” Van Vuuren said.
Van Vuuren notes, however, that many of the allegations made in the Ciex report are not supported by sufficient evidence, and therefore any investigation the public protector undertakes cannot rely solely on the report. The Ciex report was compiled by former British spy Michael Oatley who struck a deal with the South African government that he would find misappropriated apartheid era money and be paid for his work in return. Van Vuuren, however, refers to the Ciex report as a “sales pitch” that lacks substance.
Absa has taken the public protector to court over her report which directed that the R1.125-billion it allegedly gained from an apartheid-era government “lifeboat” should be recovered. Absa, however, has argued that the public protector got it wrong in her report, and that it had already paid back to the state what it owed.
Along with the Reserve Bank, Absa has asked that the court review and set aside the public protector’s findings and remedial action.
Open Secrets has intervened as amicus curiae (a friend of the court), arguing that it is in the public interest for the Ciex report to be remitted back to the public protector for proper investigation.
The case is set to be heard from December 5.