The man at the helm of the R2-trillion Public Investment Corporation, Dan Matjila, is going nowhere for now.
During crunch talks this week between the PIC’s board and the department of finance, Finance Minister Nhlanhla Nene lambasted the board for their handling of allegations levelled against chief executive officer (CEO) Matjila and chief financial officer (CFO) Matshepo More last year.
“The minister [Nene] informed the board that he has arrived at the conclusion that the PIC board has been found wanting on its fiduciary responsibilities and it must investigate these allegations with immediate effect, and he will write a letter to the PIC board to instruct them on how they must handle the issue of the investigation of the CE[O] and the CFO,” said a source familiar with the PIC.
He said the board would have to discuss whether Matjila should be suspended and, if not, how the investigation would then be conducted.
The source said Matjila’s suspension was one of the fundamental disagreements in the PIC board, particularly with the new chairperson, Mondli Gungubele.
“If the board is unable to suspend Dan, all of us must ask a question, ‘How is the investigation going to happen?’ They [the board] are perpetuating a view that this man is innocent without subjecting him to any processes. The CE[O] and CFO have a case to answer,” the source said.
But other well-placed sources in the treasury have confirmed that Matjila will not be suspended.
According to another senior government official familiar with the treasury, neither the minister nor the board can suspend Matjila based on old charges relating to last year’s allegations.
“There must be charges already formulated because the complication right now is that the board had already said that he has done nothing wrong on the old charges. He can take them to court for being prejudicial against him. You must get something new to deal with the guy,” the official said.
A source in the treasury said Nene wanted the inquiry to focus on the PIC as a whole and not limit its scope to certain individuals to determine what will happen next.
This comes after Nene announced that he has instituted an independent commission of inquiry into the affairs of the state-owned entity and that the board should institute a “proper forensic investigation” into the allegations.
Nene has reportedly already sent a letter to the board instructing it to conduct a forensic investigation. The board was set to discuss the letter during its annual general meeting on Friday. Nene is expected to make public the terms of reference for the commission of inquiry.
Matjila became the subject of an internal investigation last year following allegations that a woman alleged to be his girlfriend, Pretty Louw, had indirectly benefited from R21-million in funding from the state-owned entity. It was further alleged that Matjila had requested a PIC-funded businessperson, Lawrence Mulaudzi, to pay a R300 000 personal debt for Louw. More was seen to have been complicit in these matters.
The majority of the board cleared Matjila of any wrongdoing after he allegedly discredited the whistleblower and the process that was followed. This also divided the board, with former deputy finance minister Sfiso Buthelezi and other board members objecting to the board’s decision not to institute an independent forensic investigation of the two executives.
The PIC has been in the limelight for the past 18 months following a letter from former finance minister Malusi Gigaba to the board demanding a forensic audit of all its contracts on investments since 2015. The board did not respond to Gigaba and instead sought a legal opinion. Gigaba further requested that the board disclose all PIC transactions in the past three years, the amounts of the transactions concluded and the amounts paid by the PIC to transactional advisers or sponsors.
The PIC drew more controversy following revelations that senior executives who represented the organisation in the embattled VBS Mutual Bank, now under curatorship, had received financial benefits from a company purported to be the VBS’s biggest investor.
Gungubele refused to comment and his adviser, Bobo Mokoena, said he did not have the authority to speak on the matter.
The PIC did not respond to requests for comment.
Following the publication of this article, Treasury spokesperson Jabu Sikhakhane denied that Finance Minister Nhlanhla Nene had told the board it was found wanting on its fiduciary responsibilities.
He added that it was up to the board to decide on PIC CEO Dan Matjila’s suspension and seek the minister’s approval.