Full day of hearings into corporate scandals in Parliament

South African corporate scandals will be the order of the day in Parliament on Tuesday, as the standing committee on finance rolls up its sleeves for a full day of hearings into the imbroglios at Steinhoff, KPMG, VBS Mutual Bank, and the SA Revenue Service.

The committee will start by receiving briefings on Capitec Bank and VBS Mutual Bank on Tuesday morning.

VBS has been placed under curatorship by the SA Reserve Bank over liquidity concerns related to withdrawals by municipalities from the bank, which National Treasury forbade.

Capitec, meanwhile, was the subject of a report by US-based short seller Viceroy Research which claimed the bank was a “loan shark” with bad debts.

Capitec strenuously denied the Viceroy reports, accusing the short sellers of shoddy research and wanting to force the bank’s share price down.

In the afternoon, the committee will turn its attention to what has been happening at the SA Revenue Service, KPMG and embattled retailer Steinhoff.

The committee specifically wanted to look into the matter of former top SARS official Jonas Makwakwa, who resigned last week.

He was replaced, as chief officer of business and individual tax, with Mark Kingon. Kingon has since been named acting Commissioner of the tax agency, after Tom Moyane was suspended on Monday night.

Makwakwa is still being investigated by the Hawks for corruption and money laundering, related to suspicious payments made into his bank account in 2016.

He was suspended in 2016 following the release of a Financial Intelligence Centre (FIC) report which first flagged the suspicious payments. However an internal investigation, based in part on an investigation by law firm Hogan Lovells, cleared him of all charges.

He then returned to the tax agency in late October 2017, before resigning for “personal reasons” last week.

The committee will be looking to find out how the FIC and Hogan Lovells reports were developed.

Makwakwa’s boss Moyane, meanwhile, who may have appeared before the committee to give testimony will be absent on Tuesday following his suspension.

“In a letter to Mr Moyane, President Ramaphosa said ‘Developments at the SARS under your leadership have resulted in a deterioration in public confidence in the institution and in public finances being compromised. For the sake of the country and the economy, this situation cannot be allowed to continue, or to worsen,'” said Ramaphosa’s spokesperson Khusela Diko on Monday night.

Moyane’s axing comes after reports emerged last week that that his dismissal was imminent and being discussed by Cabinet.

The committee will discuss the report KPMG compiled for the tax agency on the so-alled SARS ‘rogue unit’ which was allegedly used to railroad top officials including Ivan Pillay and Johan Van Loggerenberg to quit revenue service.

It is also expected to receive an update on Steinhoff. — Fin 24

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Khulekani Magubane
Khulekani Magubane

Khulekani Magubane is a senior financial reporter for Fin24. 


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