President Cyril Ramaphosa should “consider” the position of Deputy State Security Minister Zizi Kodwa who finds himself “beholden” and financially indebted to a former executive of tech company EOH, which allegedly donated millions of rands to the ANC in exchange for City of Johannesburg tender awards.
This was among the damning recommendations in part four of the Zondo commission’s state capture report, which was released on Friday.
The report highlights, among other things, the firm’s more than R11-million in “donations” to the ANC and individuals, as well as contracts in excess of R400-million that were awarded to EOH to upgrade the city’s information technology network and security and to provide software licences.
The report focuses on the “improper” relationships between EOH former executives and associates and Kodwa, as well as the city’s former mayor, Geoff Makhubo, who died of Covid-19 complications in July 2021.
The commission has recommended law enforcement agencies investigate at least two of the city’s tender contract awards in 2014 and 2016, with a view to the prosecution of EOH former executives and associates Patrick Makhubedu, Reno Barry, Jehan Mackay, Ebrahim Laher, Nyiko Mutileni and any other suspects identified in the investigation, on charges under the Prevention and Combating of Corrupt Activities Act 12 of 2004 if investigators found this was warranted.
But, according to the report, Kodwa was not directly implicated in any of these investigations, although Makhubo had allegedly played a role.
Kodwa was not a public official but an employee and spokesperson for the ANC at the time he benefited from payments totaling more than R1.7-million, including a “loan” for the purchase of a Jeep motor vehicle that he bought on 6 June 2015.
EOH related entities and Mackay made cash payments in the aggregate amount of R1 680 000 to Kodwa and another R30 000 for his benefit between 28 April 2015 to 2 February 2014, the commission found.
The commission’s report described these activities as “the attempt by Mr Jehan Mackay to manipulate his relationship with Mr Zizi Kodwa to Distort Public Procurement Practices”.
Kodwa told the commission that the R1-million was a loan, but the transaction reference on the business statement for the account from which it was paid described the payment as “NG KODWA (ANC DONA-JM)”.
The report said this suggested that the paying entity, Tactical Software Solutions, “had been informed that the million rand payment was a donation to the ANC, or possibly to Mr Kodwa himself”.
In addition, companies linked to Mackay and EOH paid hundreds of thousands of rands for luxury rental accommodation for Kodwa, who told the commission he believed Mackay owned the properties.
He had also testified that the R1 710 000 payments were made at his request, by or on behalf of Mackay, at times when he was in “financial difficulties”.
“On his own version, Mr Kodwa has never been in a position to repay Mackay the amounts of the loans … and has not repaid any of these amounts. However, he insists they were not payments made as a quid pro quo for any assistance on his part. In particular, he denies that the payments and the luxury accommodation were in any way related to the procurement of government contracts by EOH or related companies,” the report said.
Apart from these benefits, Mackay had also regularly contacted Kodwa regarding “substantial donations” to be made to the ANC by the EOH group.
“Whatever the subjective intentions of Kodwa, it is clear Mackay was attempting to buy influence by making the ‘loans’ that he made to Kodwa and by providing Kodwa with luxury accommodation. He repeatedly attempted to engage Kodwa in relation to pending EOH Group tenders,” the report said.
Barely a month after Kodwa bought the jeep, Mackay e-mailed him to ask him to “look into” the disqualification of EOH from a R360-million department of home affairs tender. He also reminded Kodwa “to talk to the regional funding coordinator to understand what their funding requirements are”.
“It also insinuated that Mackay might be holding out the prospect of a large donation to the ANC as a quid pro quo for Kodwa’s requested intervention,” the report said.
The commission said it had “seen no evidence to show impropriety” on Kodwa’s part in relation to Mackay’s attempts to “induce him to interfere with procurement processes in the interests of EOH” but it had not been able to investigate what Kodwa may or may not have done because of time constraints,.
“It would not be difficult for an influential or important figure in a political party that is the majority party in a municipality to influence either officials within such a municipality or councillors to influence relevant officials.
“This point is made here in general and not necessarily suggesting that the commission is aware of any evidence that Mr Kodwa did not influence anybody to do anything improper or unlawful … However, as Deputy Minister for State Security, Mr Kodwa now finds himself in an impossible position,” the report said.
“Mr Kodwa is beholden to Mr Jehan Mackay to whom he owes more than R1.7-million.”
The report added that if the recommendations of the commission were implemented, Mackay would be the subject of multiple criminal investigations.
“It is untenable for the deputy minister of state security to find himself in a position where he is beholden to a suspect in multiple criminal investigations,” read the report.
The commission recommended that the president “considers” Kodwa’s current post “having regard to the fact that Kodwa appears to find himself in a position where he is beholden to Mr Jehan Mackay”.