Now FNB probes Mkhwebane

Public Protector Busisiwe Mkhwebane has come under intense scrutiny following a series of controversial findings. Judges have been scathing in their reviews of her rulings. A cross-section of political and civil society players have questioned her motives and allegiances. She has pointedly accused her detractors, including the media, of attacking her merely because she has the courage to hold the powerful to account. Her personal finances have not escaped scrutiny. This week brought revelations of Mkhwebane’s HSBC account being “flagged” for ostensibly suspicious activity. The public protector has batted these away, claiming it is part of a plot to undermine her. Now, the Mail & Guardian reports on a series of transactions from foreign bank accounts, paid into her local FNB bank account, over a number of years. FNB, as is required by law, is investigating possible exchange-control violations. The transactions may be perfectly legitimate but they have allegedly been flagged for an investigation.

The personal bank account of Mkhwebane is currently under investigation by FNB for possible exchange-control violations. Violations mean that money is being moved between countries without permission being sought from a bank, and without an explanation for why the money is being moved.

Over the past six weeks, four independent sources, who all spoke to the M&G on condition of anonymity, have confirmed that Mkhwebane’s account was flagged by the bank earlier this year. The account is currently under investigation by a senior bank executive, and, if the letter of the law is being followed, has also been reported to the Financial Intelligence Centre (FIC).

Mkhwebane told the M&G last week that she was not aware of the investigation. However, the M&G understands that Mkhwebane has asked for more time to provide documents to explain the transactions, which are described by sources as several payments of odd amounts between 2014 and the present day. Some of these payments, which are in the region of a few thousand dollars each, emanate from accounts in Brussels and Paris.

Mkhwebane’s spokesperson Oupa Segalwe on Thursday said she travelled to both Brussels and Paris when she was a diplomat in China. “It was for a holiday and she never received deposits into her FNB accounts … The only monies she received since this year are from Indonesia, deposited by her daughter in law’s parents for their daughter,” he said. This week, the Organised Crime and Corruption Reporting Project (OCCRP), an international nonprofit media organisation, reported that British banking giant HSBC had raised an alarm over a payment worth more than $5 000 (about R70 000) into Mkhwebane’s FNB account in June 2014. The OCCRP alleges that the payment is linked to HSBC’s broader investigation into allegations of money laundering involving the Gupta family and their associates.

Speaking to the OCCRP, HSBC spokesman Ankit Patel said the bank continues to investigate any potential links to the Guptas or Gupta-related companies. “We will review any name that comes to our attention for potential involvement in financial crime and exit those relationships as appropriate.”

Back in South Africa, there is, however, no evidence that the transactions that triggered the FNB investigation have any link to the Gupta family.

Mkhwebane has also denied any association with the Guptas. In a statement made by her spokesperson, the public protector said: “HSBC has never brought this ‘flagging’ to her attention and she has absolutely no links with the Guptas.”

According to the OCCRP, the British bank flagged a transaction between Mkhwebane’s FNB account and an account at HSBC’s subsidiary in Hong Kong.

Mkhwebane’s HSBC account was reported to have formed part of a larger data set that came under scrutiny during an internal investigation by HSBC into potentially illicit financial flows emanating from Gupta-linked accounts.

Speaking to the Sunday Independent in April — in relation to reports that she was under investigation for her suspected involvement in her husband’s death, as well as alleged money laundering activities (both of which she denied) — Mkhwebane said transfers between Hong Kong and her FNB account related to the sale of property in Centurion, Pretoria while she served as a diplomat in Shanghai.

“There is no huge amount of money which I transferred to South Africa, besides the fact that when I was still in China I sold my property and then I bought another property whilst I was still a diplomat. When I left China, I closed my bank account in Hong Kong and transferred the money here,” said Mkhwebane.

According to people familiar with banking in China, it is not unusual for foreigners working in China to use banking facilities in Hong Kong, because Hong Kong-based banks better facilitate the movement of money across borders, thus serving expats better.

Although FNB declined to comment on specific questions put to it about Mkhwebane’s account, the bank said that it complied with laws governing the flow of funds across borders. “As an authorised dealer in foreign exchange, the bank is required to ensure customers comply with the conditions, if any, and limits in transacting foreign exchange transactions. Any transactions that do not comply are reported to the relevant regulatory bodies,” FNB said in a statement.

The FIC, however, declined to comment on any details, citing confidentiality as implicit to its workings. In a statement in response to the M&G’s questions, it said: “The FIC Act contains confidentiality requirements which prevent the organisation from commenting on the nature and contents of reports the FIC may or may not have received. These requirements, which protect reporters and subjects of reports alike, also safeguard sensitive information concerning the FIC’s analysis of reported information.”

With additional reporting by Lynley Donnelly

A long and winding path to power

Before Busisiwe Mkhwebane began her seven-year term as public protector in 2016, her career was eclectic — taking her from magistrate’s courts in South Africa to the country’s embassy in China.

She is an advocate of the high court, having obtained BProc and LLB degrees from the University of the North, now the University of Limpopo, in 1992.

Between 1994 and 1998, Mkhwebane worked as a legal administration officer in the justice department’s international affairs directorate and as a public prosecutor on criminal and maintenance cases.

She then worked as a senior researcher at the South African Human Rights Commission until 1999, when she made her way to

the office of the public protector, where she began as a senior investigator.

In 2009, she moved to the department of home affairs. There, she worked as the acting chief director of asylum seekers management.

Two years later, Mkhwebane moved to the South African embassy in China where she worked as an immigration counsellor until 2014.

She then moved back to the department of home affairs as the director of country information and co-operation management.

In July 2016, she began working for the State Security Agency as a senior analyst. In October that year, she was appointed the country’s fourth public protector by then president Jacob Zuma. — Sarah Smit