President Cyril Ramaphosa intends taking on legal review the section 89 independent panel’s adverse report on Phala Phala released earlier this week.
(Brenton Geach/EPA)
The Public Protector had no authority to investigate the CR17 campaign, said President Cyril Ramaphosa in court papers filed on Wednesday. “The Public Protector’s approach in this matter is unfortunate and leaves a lot to be desired.”
Ramaphosa has urgently approached the high court to set aside the Public Protector’s Bosasa report and, in the interim, to interdict the implementation of some of the remedial action directed by her.
Busisiwe Mkhwebane’s report found that Ramaphosa had deliberately misled Parliament when he answered a Parliamentary question about a donation from Gavin Watson — the CEO of African Global Operations, formerly Bosasa — to the CR17 campaign, the campaign supporting his bid for presidency of the ANC at the party’s Nasrec elective congress in 2017. She also found that he had breached the Executive Ethics Code when he did not declare to Parliament the donations to the CR17 campaign.
In her report, Mkhwebane revealed that the CR17 campaign had received tens of millions of rands. However, the exact number is unclear as many of the amounts detailed in her report were disputed by Ramaphosa.
As remedial action, Mkhwebane directed the Speaker of Parliament to refer the non-disclosure to Parliament’s ethics committee and to demand that he disclose all the donations received by the CR17 campaign.
Mkhwebane also found that there was “merit” in the suspicion of money laundering, because the payment passed through “several intermediaries, instead of a straight donation towards the CR17 campaign”.
In his court papers, Ramaphosa said the Public Protector was, like him, subject to the Constitution and the law did not empower her to unilaterally expand the scope of an investigation under the Executive Ethics Act.
Ramaphosa said that the complaints that gave rise to Mkhwebane’s investigation, made by DA leader Mmusi Maimane and EFF deputy president Floyd Shivambu were limited to the R500 000 donation made by Watson.
The president noted that, under the Executive Ethics Act, the Public Protector was only empowered to investigate what was in the complaints.
Instead, he said that she had called members of the campaign team and asked them “to disclose information about all donations to the CR17 campaign”. He added that: “This request was declined on the basis that it was not relevant to the complaints.” She had also subpoenaed the law firm that held the trust account to which donations were made, including the financial statements of the account.
Ramaphosa said there was no obligation on him to disclose donations received by the campaign — this was “a fundamental misreading of the code”.
The question had even been looked at by a joint ad hoc committee of Parliament when Maimane had faced a similar complaint, he said. The committee found that “the code is vague on the disclosure of campaign funding. In the light of the vagueness of the code, the committee is not in a position to make a finding of non-disclosure in this case”.
“Until the Code is amended to clarify whether or not there is an obligation for members of the National Assembly and the Executive to disclose campaign donations, it is utterly incompetent for the Public Protector to impose such a duty on the National Assembly,” said the President.
He also said her suspicion of money laundering was without “any factual foundation whatsoever”. Money laundering was a statutory offence set out in the Prevention of Organised Crime Act, he said.
For an offence of money laundering, the money in question must be the proceeds of crime, and the implicated person should have known this. Then, there needed to be an agreement the effect of which was to conceal the source of the money for the purpose of avoiding prosecution, he said.
“The Public Protector did not engage with this definition at all,” said Ramaphosa, and there was no evidence that any of the requirements had been met — even on a prima facie basis.
He said the payment from Watson was made to the CR17 campaign’s trust account via company associated with Watson — Miotto Trading. “It is false that the money went through ‘several intermediaries’. The money came from Watson, through his agent, into account EFG2 [the campaign’s trust account].”
Mkhwebane did not even reference the Prevention of Organised Crime Act (POCA) in her report, he said. Instead she referred to the Prevention and Combating of Corrupt Activities Act (PRECCA), which does not deal with money laundering, said Ramaphosa.
“The fact that the Public Protector appears unable to distinguish between PRECCA and POCA is gravely concerning. If the Public Protector had paid attention to the provisions of the applicable law, namely POCA, she would have realised that the elements of the definition of the crime of money-laundering, even on a prima facie basis are not established,” said Ramaphosa.
Instructing the NPA to investigate it was incompetent in law, he said. “The NDPP [National Director of Public Prosecutions] must function independently in terms of section 179 of the Constitution. It has autonomy to decide whether or not a particular criminal conduct should be prosecuted or not,” he said.
He also said her report was based on “material errors of fact”. Prior to the release of the final report, Ramaphosa had sent Mkhwebane a response in terms of section 7(9) of the Public Protector Act, which entitles someone implicated to respond to preliminary findings. In it, he identified a number of instances where he said she had gotten the facts wrong.
In his court papers, he asked that the response be incorporated into his case. “In summary, the Public Protector misunderstood the flow of the funds, miscalculated the amounts paid, double counted the same amounts in some instances, referred to incorrect time periods and misunderstood the relationships between the various entities.”
“The role of the Public Protector is to strengthen our democracy — not to undermine confidence in the President by raising false alarms. The Public Protector has strayed,” he said.
Mkhwebane’s office did not immediately respond to a request for comment. This story will be updated should her office respond.