Justice Minister Ronald Lamola. (Brenton Geach/Gallo Images and Phill Magakoe/ Gallo Images)
Justice Minister Ronald Lamola has told parliament nearly 100 state capture investigations are underway apart from seven cases that have been brought to court, where 65 suspects are facing charges flowing from recommendations in the Zondo report.
The number, which includes the accused in the Estina dairy farm and asbestos cases in the Free State, refers to 43 people and 22 companies, Lamola said on Thursday amid criticism that the state is doing too little, too slowly to prosecute those involved in grand corruption.
The first state capture case to go to trial, the Nulane Investments matter, ended in humiliation for the state in April when acting Bloemfontein high court Judge Nompumelelo Gusha granted section 174 discharges to seven accused and acquitted the eighth.
The National Prosecuting Authority (NPA) has termed the outcome a grave miscarriage of justice in an application for leave to appeal to the supreme court of appeal (SCA). It argues that the judge made nine errors of law and failed to meet the ethical and legal standards demanded of the bench.
Because the fraud alleged in the Nulane case paved the way for the dairy farm scam, the list of the accused in the two cases overlap in part. Gupta associate Ronica Ragavan, the self-described treasurer of the family’s business operations, was discharged in the first case but features as an accused in the Estina matter.
So do the family’s Islandsite Investments and former Free State provincial government official Peter Thabethe, likewise discharged in the Nulane case.
Salim Essa, memorably described in the commission’s hearings as the Guptas’ “money-laundering lieutenant”, is among the 18 accused in the Transnet Transaction Advisory Contract case, along with former chief executives Brian Molefe and Siyabonga Gama and former chief financial officer Anoj Singh.
He left the country for Dubai years ago, and the state has yet to request his extradition. Though the state has based its ongoing efforts to secure the extradition of Atul and Rajesh Gupta on the fraud and money-laundering charges set out in the Nulane and Estina cases, they do not feature among the accused at this stage.
The R398 million Transnet matter deals with rent-seeking consultancy contracts with McKinsey, Trillian and Regiments Capital that accompanied the parastatal’s procurement of 1 064 locomotives from Chinese suppliers at grossly inflated prices.
The Zondo commission found that Molefe, Gama and Singh gave Essa “free reign” during the process and that he collected R7.32 billion in kickbacks from the China South Rail Corporation and the China North Rail Corporation. It said Essa got 15% of the bribes paid by the service providers to shell companies while the Guptas got the rest.
Chief Justice Raymond Zondo, in volume two of his report, described how the family secured a hold over Transnet by systematically taking over its board and senior management. The process was later replicated at Eskom, following Molefe and Singh secondment to the power utility.
In remarks to parliament on Thursday, Lamola noted that following the Special Investigating Unit’s inquiry into companies that overcharged Eskom, McKinsey was ordered to pay back R1.1 billion and Deloitte was ordered to pay back R150 million.
Trillian was served with a court order for the sum of R600 million, the minister added. This court order was, in fact, granted in the NPA’s favour in October 2019, but efforts to recover the money have been hindered by Trillian’s insolvency and, according to the prosecuting authority’s submissions to court, blatant disregard of the company’s sole director, Eric Wood, a co-accused in the Transnet case, of the order.
Lamola also noted that the Criminal Asset Recovery Fund had been boosted by R2.5 billion thanks to the recovery of punitive reparations by the Investigating Directorate (ID) from Asea Brown Boveri (ABB) for serious crimes committed during the state capture period at Eskom. This in addition to the R1.6 billion that ABB paid to Eskom in 2020.
The ID’s investigations related to corruption that ensued after the company won a R2.2 billion contract in 2015 to provide the control and implementation system for the Kusile power station. Two of its former employees — Mohammed Mooidheen and Vernon Pillay — and their wives have been arrested on charges of fraud, corruption and money-laundering stemming from contracts awarded to Impulse International for lucrative work at the plant.
According to the justice minister, the ID has so far declared 99 investigations into state capture crimes, and enrolled 34 cases, involving 205 suspects.
But, to date, only two people fingered by the commission have been convicted. The first is the former head of the Free State department of human settlements, Moses Mokoena, who was handed a prison sentence for breach of the Public Finance Management Act and the Combating of Corrupt Activities Act for his role in the housing scandal in that province. It saw R1 billion allocated to a project that yielded no houses.
The second is former SAA chairwoman Dudu Myeli, who was fined R120 000 last year for obstructing the course of justice for revealing the name of a protected witness in a hearing of the Zondo inquiry. The commission has recommended that she be charged with fraud for knowingly making misrepresentations to the public enterprises ministry that caused SAA to suffer crippling financial losses.
Lamola claimed that his department has, a year after receiving the final volumes of the state capture report, “responded to most of the recommendations which fall within the sphere of the justice department”. This included tabling the NPA Amendment Bill which will turn the ID into a permanent body with the ability to hire its own investigators.