23 Apr

Zuma Legacy Leaves South African Anti-Graft Panel With Huge Task

A South African judicial commission faces a daunting task in investigating allegations that members of the Gupta family and their allies connived with former President Jacob Zuma and his son Duduzane to loot billions of rand from state coffers.

Its success or failure will go a long way in determining whether South Africa can put behind it years of mismanagement and plunder during Zuma’s scandal-ridden administration that undermined investor confidence and stymied economic growth.

Zuma agreed to the inquiry after losing control of the ruling party and a lawsuit challenging a directive from the nation’s former graft ombudsman that spelled out its powers and appointment procedures.

Deputy Chief Justice Raymond Zondo and his panel of six senior staff members must probe an array of deals between state entities and private businesses, some of them set up to obscure the intended beneficiaries.

It will require wading through hundreds of thousands of documents and interviewing scores of witnesses, many of who may be reluctant to give evidence because they risk implicating themselves. Several key players, including the three Gupta brothers and Duduzane Zuma, have fled the country.

While the panel was given six months to complete its investigation into what’s become known in South Africa as “state capture,” Zondo has said that’s woefully inadequate and he’s requested an extension to its mandate. He hasn’t said when public hearings will begin. The commission’s findings could be used as the basis for criminal prosecutions by law enforcement agencies, which are also conducting several concurrent probes.

These are among the key controversies the commission will have to focus on:

Peddling of cabinet posts

Former Deputy Finance Minister Mcebisi Jonas and Vytjie Mentor, the ex-chairwoman of parliament’s public enterprises portfolio committee, alleged that the Guptas offered them ministerial posts in exchange for business concessions. Jonas said he was also offered a 600-million-rand ($50 million) bribe.

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14 Mar

South African Graft Inquiry to Summon Zuma’s Son, Guptas

South African lawmakers said they will summon the Gupta family and the son of former President Jacob Zuma to appear before an inquiry that is investigating the mismanagement of public funds at state-owned enterprises.

The former chairwoman of South African Airways, Dudu Myeni, will also be subpoenaed after failing to heed two invitations to give testimony at the hearings in Cape Town, parliament said in an emailed statement on Tuesday.

The portfolio committee on public accounts is probing so-called state capture, or allegations that Zuma has allowed the Gupta family to secure state contracts and influence cabinet appointments. They all deny wrongdoing.

The “issuing of summons is the last resort that the committee had to undertake as invitations have been issued without any success,” parliament said in the statement. “It would be impossible to finish the work of the inquiry without the testimony of Ms. Myeni, including that of Mr. Zuma and the Gupta family.”

On Tuesday, Home Affairs Minister Malusi Gigaba, who was minister of public enterprises when the board members involved in the allegedly corrupt contracts were named, told the committee he had a limited role in making the appointments and that state-security authorities should vet prospective board members more closely.

“There is a very high cost to corruption and allegations of state capture and there is a very high benefit to action being taken against those issues,” he said. “Unfortunately, the lesson can only be learned after enormous cost to the economy, but nonetheless the lesson has been learned.”

Source: https://www.bloomberg.com/news/articles/2018-03-13/south-africa-graft-inquiry-to-summon-zuma-s-son-gupta-brothers

01 Mar

Bank of Baroda Cries Foul as Cash Frozen in South Africa Gupta Case

India’s Bank of Baroda objected to the freezing of some of its funds in South Africa after it was alleged to have helped transfer money meant for the development of a government-backed dairy farm to the politically connected Gupta family and their associates.

The 30 million-rand ($2.5 million) preservation order is wrong because the money due to clients had already been withdrawn and the attachment of an equal amount of the lender’s own funds is “unsustainable,” Luke Spiller, a legal representative for the Bank of Baroda, said in the Free State province’s High Court in Bloemfontein on Thursday.

The court documents showed that other banks transferred cash to the same dairy farm but their money wasn’t frozen, making the order against Bank of Baroda unfair, the lawyer said.

The case is related to a state-owned farm in the Free State leased to Gupta-linked company Estina (Pty) Ltd. in 2012.

The regional government agreed to help develop the land, but the High Court on Jan. 19 gave the National Prosecuting Authority permission to freeze the project’s assets after more than 220 million rand destined for the farm was said to have been transferred to Atul Gupta, one of three brothers, and a number of companies and associates. State prosecutors allege Atul Gupta received 10 million rand.

Atul Gupta and businesses linked to his family have applied to the same court to reconsider the assets’ attachment. The Gupta family have close ties to former President Jacob Zuma and have been accused of using the association to win state business and influence government appointments.

Zuma and the Guptas have denied wrongdoing. The crackdown on the dairy farm project came just weeks after South African President Cyril Ramaphosa replaced Zuma as head of the ruling African National Congress.

The prosecutor’s papers are “a national embarrassment,” Michael Hellens, a lawyer acting for a number of Gupta-linked companies including Oakbay Investments Pty Ltd., said in the same court.

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14 Feb

Zuma Has Next Move in ANC Power Battle as Gupta Home Raided

The noose tightened on South African President Jacob Zuma as the police went after key allies while leaders of the ruling African National Congress vowed to force him from office.

Police raided the Johannesburg home of the Gupta family, who are in business with Zuma’s son, Duduzane, early Wednesday as the nation awaited the president’s next move in his struggle for power with Cyril Ramaphosa.

Time is against Zuma, South Africa’s ultimate political street fighter, as Ramaphosa has relentlessly grabbed political space since he won the presidency of the party by a razor-thin majority in December.

The ANC expects Zuma to respond to its decision to replace him Wednesday, its spokesman Pule Mabe told Johannesburg-based state broadcaster SAFM. The presidency said no media event was scheduled.

Zuma succeeded in delaying the inevitable last week when his apparent willingness to negotiate prompted Ramaphosa and the rest of the ANC leadership to postpone a meeting of their top body, the National Executive Committee, to decide his future.

But as the talks dragged on, the NEC decided late Monday that his time was up. When he countered by asking to remain in office for up to six months, the party bosses said enough is enough.

“It’s not up to Zuma now; he no longer has any option,” said Mpumelelo Mkhabela, a political analyst at the University of Pretoria’s Center of Governance Innovation. “They gave him the option to take control of his own resignation, and when that didn’t work the party took control. The idea of trying not to humiliate him didn’t work.”

While ANC Secretary-General Ace Magashule was at pains to show respect for the president on Tuesday, saying Zuma had done nothing, critics say his tenure will be remembered as a time when South Africa went from being known as a “rainbow nation” to one colored by corruption.

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26 Jan

Zuma- Gupta Ties Under Spotlight in South African Graft Probe

A South African commission of inquiry will investigate whether President Jacob Zuma played any role in the Gupta family’s alleged offer of cabinet posts to people including former Deputy Finance Minister Mcebisi Jonas and other claims that they influenced state decisions.

The inquiry will be guided by the report of the nation’s former Public Protector Thuli Madonsela, according to its terms of reference published in the Government Gazette on Thursday.

She ordered the inquiry into allegations that the Guptas may have influenced cabinet appointments and received special treatment for a coal business linked to the family and one of the president’s sons. Zuma and the Guptas have denied wrongdoing.

Jonas said the Gupta family offered him the position of finance minister, two months before Nhlanhla Nene was removed from the post, sparking a drop in the rand and the nation’s bonds.

Last month, Deputy President Cyril Ramaphosa succeeded Zuma as head of the African National Congress and has pledged to clamp down on corruption in a bid to revive the ruling party’s flagging public support before general elections next year and boost investor confidence in the economy.

Some senior members of the ANC have called for the commission to probe allegations of undue influence over state decisions going back as far as 1994 and beyond, under the former all-white government. The terms of reference may be expanded or amended, according to the proclamation.

Madonsela said in November 2016 that Chief Justice Mogoeng Mogoeng should appoint the head of the inquiry because the president had a conflict of interest.

Zuma said earlier this month he would appoint the commission and abide by a court ruling that Mogoeng must select its leader.

This was after the High Court in December rejected Zuma’s arguments that he alone can set up the commission and ordered him to pay the cost of the case. Zuma accepted Mogoeng’s recommendation that his deputy, Raymond Zondo, head the commission.

The commission must submit its report and recommendations to the president within 180 days of its commencement, according to the gazette.

Source: https://www.bloomberg.com/news/articles/2018-01-25/zuma-gupta-ties-under-spotlight-in-south-african-graft-probe