Tag Archives: ANC and Guptas

South Africa – Mantashe on ANC owning up to #Guptaleaks

News24

2017-06-24 07:48

ANC secretary general Gwede Mantashe (Lerato Sejake, News24)

ANC secretary general Gwede Mantashe (Lerato Sejake, News24)

 

Tshwane – The fact that some ANC members have confirmed being implicated in a trove of leaked Gupta emails is good for the political party says its secretary general Gwede Mantashe.

He delivered an address on Friday night at the ANC Gauteng’s policy conference taking place throughout the weekend in Irene.

“There is something positive coming out of these emails up, to now four of our comrades have owned up. Four, yes, owned up.” He told delegates.

Mantashe who used the opportunity to deliver a political school style lecture spoke about the state of branches and members of the party. He also praised those who confirmed their involvement with the family said to have close ties to the president.

The Guptas have been accused of having undue influence over President Jacob Zuma and some state owned enterprises. The family is also said to have had a hand in making key decisions such as appointing ministers in the country.

Their role in claims of state capture has been likened by some, such as the academic fraternity, as a soft coup.

‘We used to lie blatantly’

Among those who have confirmed the claims are Communications Minister Ayanda Dlodlo who admitted that she had taken a trip to Dubai courtesy of the Gupta family, North West Premier Supra Mahumapelo who was cited as being one of the many faces in the liberation movement to have pitched at their Saxonwold home and the president’s advisor Lakela Kaunda has admitted that in 2008 she was a non-executive director of a Gupta owned company, but resigned after 6 months.

“It didn’t used to happen, we would deny everything [and say] no I don’t know what’s going on. We used to lie blatantly” said Mantashe in explaining how the posture of the party needed to change when it came to negative developments around the party.

“They all said it, yes I was there, yes it true, yes it’s true, yes it’s true,” said the SG in Xhosa.

He also reiterated the calls for a judicial inquiry, which the president has now said he would establish.

“It must be constitutional and enforceable,” said Mantashe.

Mantashe said the 105 year old liberation movement needed to change its posture on matters in the public domain, not only speak out against wrong doings but show that it was actually taking measures to address the problems.

He praised one of his comrades, former mayor of Ekurhuleni and now Member of Parliament Mondli Gungubele for his role in an adhoc committee on communications and its handling of the troubles at the South African Broadcasting Corporation (SABC).

“When you started confronting the situation at the SABC then people began to see that the ANC knows the difference between right and wrong,” said Mantashe.

No political ideology

The ANC SG also decried the state of branches saying there was a decline in political ideology in the movement.

“Comrades begin to howl and use common sense that is not so common because they are guided by no ideology,” said Mantashe.

Giving insights on areas where current office bearers and stalwarts disagreed, Mantashe said former leaders of the party who had called for a national consultative conference had wanted to discuss the state of the organisation without the branches.

“We didn’t agree with veterans when they said we don’t want the branches [because] their politics [are] too poor,” he said describing the request as flawed.

When you say that you are blaming the victim, he added.

“You recruit a person say for 23 years, then say a member who has been around for 15 years is of poor quality, that member of the branch is a victim of you not doing what you should do,” he said.

Mantsashe said when he visited different branches across the different regions to deliver political school he found leaders, even in regions, did not know about the national democratic revolution.

“This is not isolated. It’s not rare, you come across it everywhere,” he said.

Mantashe said party members were not busy with discussions but too focused on issues around deployment and tenders.

He also said the party needed to accept that society was correct when it placed high expectations on the party.

“When people complain of state capture and that family [the Guptas] we then say what about white monopoly capital,” he went to define this as flawed.

“You are selecting the lowest common denominator to measure yourself because white monopoly capital is the essence of the revolution.”

South Africa – Captura Continua: Will the Guptas determine the ANC succession race?

Daily Maverick (South Africa)

    • Ranjeni Munusamy
      ranjeni munusami BW

 

ranjeni-Succession-post-GuptaLeaks.jpg

Three weeks after the Guptas’ private email correspondence began cascading into the public domain, revealing the depth of the capture of the South African state, we are yet to see outrage and a fightback from the ANC. The party elected to govern by South African people, but now essentially cuckolded by the Guptas, has shown it is powerless against the family. The Guptas appear to be still pushing buttons behind the scenes and their main focus is to ensure that they stack the deck at the ANC’s 54th national conference, mostly to secure their new Number One. By RANJENI MUNUSAMY. 20

Nkosazana Dlamini-Zuma has publicly accepted nomination for the position of ANC president, making her the first woman in the history of the 105-year-old organisation to contest the top leadership post. But far from this being a notable moment in history, it is the occasion for despair. Dlamini-Zuma has, without reservation, consented to becoming top of the ticket sponsored by the Gupta family. 31

Up to this point, one could still give Dlamini-Zuma the benefit of the doubt that she was simply riding the ANC Women’s League (ANCWL) wave and would distinguish herself from the Gupta herd. But last week the ANC Youth League (ANCYL) announced its leadership slate, the first ANC structure to do so formally. 27

“Comrade Nkosazana Dlamini-Zuma is the president of the ANC, comrade David Mabuza as the deputy president of the ANC, Comrade Ace Magashule as the secretary general of the ANC, Comrade Nathi Mthethwa as the national chair of the ANC, DSG for monitoring and evaluation Comrade Jessie Duarte, DSG for organising and campaigns Comrade Fikile Mbalula and the treasurer general Comrade Maite Nkoana-Mashabane,” ANCYL secretary general Njabulo Nzuza announced at a media briefing following their national executive committee meeting. 29

The ANCWL’s endorsement of Dlamini-Zuma and declaration that it wanted more women in the top leadership of the party at least had the veneer of punting the gender ticket. There was no such effort by the ANCYL. Mbalula, a former ANCYL president, was nominated for a position that does not even exist constitutionally in the ANC. Besides, Mbalula is now 46 years old and can hardly qualify as a “youthful” candidate in the leadership race. The second youngest person on the ANCYL slate is Mthethwa, who at 50 years old is hardly a spring chicken himself. 24

So what is the Youth League up to? And why is Dlamini-Zuma such a willing participant in this agenda? 7

In January ANCYL president Collen Maine indicated that their choice of presidential candidate would send “shockwaves” throughout the ruling party. 12

“These candidates who have been mentioned are part of the system. They have been part of the system we want to change. We need bold leadership. We need a second revolution that will cause ruptures in the economy,” Maine told Reuters back then. 36

Either Maine overestimated the impact of their endorsement of Dlamini-Zuma or their hand was forced to change the “shockwave” candidate they had in mind. There was also talk a few months ago that the ANCYL slate would include Malusi Gigaba, now the finance minister, and Mbalula, for top posts. Clearly that did not materialise. 19

The #GuptaLeaks exposed that Maine was being scripted by the family’s PR firm Bell Pottinger to further their manufactured white monopoly capital narrative. 29

So what else are Maine and his organisation doing on behalf of the Guptas? 19

Since the release of their emails, there have been no public moves by the Guptas. They have gone to ground and not responded publicly to any of the revelations against them. Clearly the family does not believe their ecosystem has been significantly disturbed by the revelations or the reaction to them. 25

While Gigaba and his public enterprises counterpart Lynne Brown are floundering to keep their heads above water, the people who should be most affected by the leak of the tranche of emails are manoeuvring from their place of seclusion. They are doing what they do best – arranging the political playing field to protect themselves and advance the interests of their business empire. 37

There are two positions in the ANC leadership that the Guptas need in particular to keep their project on track: president and secretary general. The ANCYL slate stitches that up for them. 21

President Jacob Zuma and his son Duduzane have been worthwhile investments for the family – both performing as lead marionettes in the Gupta extravaganza. But when Zuma ceases to be ANC president, his power diminishes and he would become a lame duck in the state. Duduzane will then be expendable – unless he is able to act as middleman to the successor as well. 19

Enter Dlamini-Zuma, his stepmother and willing advocate of the “radical economic transformation” narrative that Duduzane and Bell Pottinger conjured up. 26

There have been many moments in the chaos of this year when the former African Union Commission chairperson could have distanced herself from the chaos of the Zuma presidency. If hers was to be a clean, capture-free presidency, the most obvious move would have been to put fresh air between herself from Zuma’s disastrous midnight Cabinet reshuffle. After all, as a potential president, Dlamini-Zuma would inherit the consequences of that suicidal move – a downgraded and junked economy. Surely it would make sense to separate herself from that mess. 32

It would also have been logical for Dlamini-Zuma to distance herself from the stench of the Gupta emails, especially considering they had nothing to do with her. The campaign of her main competitor, Cyril Ramaphosa, has been significantly strengthened by him speaking out against state capture and repeatedly calling for a judicial commission of inquiry into the mounting allegations. Ramaphosa’s campaign has morphed into an anti-corruption ticket basically by him stating the obvious: a full-scale, credible investigation is required. 30

But Dlamini-Zuma is doing no such thing. She is not making any effort to separate herself from the capture contagion. Clearly it serves her agenda. 41

The secretary general position is essential to control the functioning of the ANC. While the Guptas might not have captured Gwede Mantashe, his erraticism and volatility did not do much to protect the ANC from their influence. But the Guptas did have a handy insider in the office of the ANC secretary general in the form of Mantashe’s deputy, Jessie Duarte. She is entangled in their network and also exposed as talking to their script. 32

The Guptas are now looking to seize control of the office of the secretary general entirely. Free State Premier Ace Magashule is the candidate who will deliver the ANC in its entirety to the family. 34

Magashule has already been a handy asset for the Guptas, delivering massive provincial deals and feeding their media entities through the provincial coffers. His sons, Tshepiso and Thato, were exposed in the emails as having been ensnared in the Gupta network for some time. Magashule clearly has ambitions and a higher calling now. 33

Opposition to his candidacy came from a surprise source in the past few days. Mbalula indulged in a spontaneous Twitter blast in which he recommended Gauteng Premier David Makhura for the position of secretary general. 25

“Ace Magashule a definite no no no the man will finish what is remaining of our movement he will kill it inffect #Thinkingaloudbeyond,” Mbalula tweeted. This was followed by: “Ancyl let’s rally behind David Makhura as a replacement to Gweede Mantashe #ThinkingBeyondFactions”. 12

Mbalula reaffirmed his sentiments to the Sunday Times, saying he had nothing against Magashule personally but believed the secretary general position was essential to the ANC’s survival. 16

“The office of the SG comes with a lot of integrity. It must not take sides and annihilate people and run comrades to the ground,” said Mbalula. Clearly the police minister does not think too highly of the candidate nominated by the ANCYL. But Mbalula’s tweets do open the debate beyond the Gupta-endorsed slate and the faction rallying behind Ramaphosa. 12

This weekend, Gauteng ANC chairperson Paul Mashatile threw his weight behind Ramaphosa, saying he could protect the country from all forms of capture. He told the ANC’s West Rand regional general council that the ANC did not need cowards who would put the country up for sale. He also dispelled the debate over a woman president, saying the ANC needed a capable leader of whichever gender. 28

While Mashatile’s endorsement is indicative that Gauteng is likely to rally behind Ramaphosa, the province might be disorientated if there are more calls for Makhura to be deployed as a consensus candidate for secretary general. Gauteng is resolved that Mashatile should occupy one of the top six posts and has been negotiating with other provinces in this regard. 13

But all the debates and negotiations around succession might come to nothing if the ANC remains powerless to the interference of the Guptas in its processes. The infusion of dirty money to influence the votes of branch delegates has been a successful lobbying tactic in the past and will no doubt be used again. The Guptas have sufficient resources to splurge on this project, particularly as they have a massive vested interest in the outcome of the leadership elections. 28

Buying off a president has turned out to be a boon for the Guptas. Even though the state capture edifice is cracking, the Guptas know that capturing the top leadership of the ANC in December will allow them to regain their foothold and have unrestricted access to the state machinery and resources. 31

There is nothing to indicate that the ANC has the ability or willingness to stop them. The party has six months to fight off the biggest demon since apartheid – or be conquered by it. DM

  • Ranjeni Munusamy is a survivor of the Salem witch trials and has the scars to show it. She has a substantial collection of tattered t-shirts from having “been there and done it” – from government, the Zuma trials, spin-doctoring and upsetting the applecart in South African newsrooms. Following a rather unexciting exorcism ceremony, she traded her femme-fatale gear for a Macbook and a packet of Liquorice Allsorts. Her graduation Cum Laude from the School of Hard Knocks means she knows a thing or two about telling the South African story.

  • South Africa

South Africa – Mantashe says Zuma could be removed as head of state before 2019

Reuters

By Joe Brock | JOHANNESBURG

JOHANNESBURG South African President Jacob Zuma may be removed as head of state after a December conference when a new leader of the ruling African National Congress will be chosen, Secretary General Gwede Mantashe said on Wednesday.

Zuma has survived calls to resign from sections of the ANC in recent months following a string of corruption scandals, waning public support and economic instability caused by a heavily-criticised cabinet reshuffle in March.

Though Zuma can remain South African president until an election in 2019, senior ANC sources opposed to him have told Reuters they will push for his removal as head of state shortly after he steps down as party leader in December.

ANC’s top leadership, including Mantashe, have been critical of some of Zuma’s decisions but have not publicly said they back proposals to remove him.

Asked if it would be easier for Zuma’s ANC opponents to remove him after the party conference, Mantashe told Reuters: “Yes, that’s exactly the point I’m making. After December … he will not be the president of the ANC, who by resolution should be president of the republic. It’s less complex.”

Mantashe gave as an example former president Thabo Mbeki who was recalled as head of state by the ANC in 2008, less than a year after he was ousted as party leader.

Zuma is unpopular with most investors and the possibility of him leaving office before 2019 would be welcomed by markets.

CORRUPTION

Backroom rifts within the ANC have been thrust into the open this week after more than 100,000 emails leaked to local media allegedly showed improper dealings in lucrative government contracts by business friends of Zuma.

Zuma and the Gupta family, wealthy Indian-born businessmen whose companies have contracts with state-owned firms, have not commented, though they have denied similar allegations in the past. Reuters could not independently verify the new allegations.

Mantashe said the allegations were damaging the reputation of the ANC and called for a judicial inquiry to investigate the influence of business interests in government. Zuma has not yet agreed to such an investigation.

“It damages the ANC because we are the governing party. Many of the people cited there as beneficiaries of the Guptas are leaders of the ANC, so we’re paying the price for that,” Mantashe said.

The latest allegations of influence-peddling are deepening divides in the ANC as factions battle for control ahead of the December party conference.

Zuma has backed his ex-wife and former African Union chair Nkosazana Dlamini-Zuma to succeed him, while other ANC factions are supporting Deputy President Cyril Ramaphosa.

Opposition parties have made upbeat comments about unseating the ANC in 2019, an unthinkable scenario a few years ago for a party that has led comfortably since it swept to power under Nelson Mandela at the end of white-minority rule in 1994.

The ANC lost control of major cities last year in its worst local election results since coming to power, partly due to a drop in public support for Zuma.

“When we go to the 2019 elections we will have a new face of the ANC. It doesn’t matter whether he (Zuma) leaves after December or doesn’t leave,” Mantashe said.

“There is an inherent risk that you can win and equally a risk that you can lose. We take every election seriously.”

 

South Africa: ANC calls for Zuma GuptaLeaks investigation

BBC

Jacob ZumaImage copyright Reuters
Image caption President Jacob Zuma has survived many previous accusations of corruption

South Africa’s ruling party has called for an investigation into emails which appear to show allegedly corrupt links between President Jacob Zuma’s family and wealthy businessmen.

The African National Congress (ANC) said the allegations questioned the credibility of the government and such matters could not be allowed to fester.

Mr Zuma recently survived calls for his resignation by some senior ANC members.

The allegations have been dismissed as a fabrication by Mr Zuma’s lawyers.

The Gupta family of businessmen has said the leaks were “politically inspired”.

Mr Zuma has become increasing unpopular in recent years amid accusations of corruption and not doing enough to tackle poverty.

There have been mass protests calling for him to step down.

One of the revelations in the emails, known as GuptaLeaks, is that President Zuma was hoping to take up residency in the United Arab Emirates. A claim that was denied.

Others appear to show that the Gupta family exerts undue influence over the government.

Grey line

Have Jacob Zuma’s nine lives run out? Milton Nkosi, BBC News, South Africa

Demonstrators take part in a protest calling for the removal of South AfricaImage copyright Reuters

By calling for an investigation, the African National Congress is putting its own leader under pressure to come clean.

At the centre of the alleged scandal is President Zuma’s son Duduzane, a business partner with the controversial Gupta family.

Some of the emails released by local media allege that Duduzane has been playing the role of middleman between his father and private business interests.

This looks like the ANC is slowly washing its hands of its 74-year-old leader. They know he will not be at the helm in six months’ time and so the dominos are beginning to fall.

Mr Zuma’s obituary has been written many times before. But even so, it does feel like Mr Zuma’s nine lives are gradually coming to an end.

Mr Zuma is due to step down as ANC president in December and his ex-wife Nkosazana Dlamini-Zuma and Deputy President Cyril Ramaphosa are vying to replace him.

His term as national president expires in 2019.

South Africa – Ramaphosa speaks out against “state capture” again

News24

2017-04-20

Deputy President Cyril Ramaphosa. (File)

Deputy President Cyril Ramaphosa. (File) (Cyril Ramaphosa)

Johannesburg – Do not allow revolutionary sounding slogans to hoodwink the public, Deputy President Cyril Ramaphosa said.

Speaking at a Black Business Council event in Sandton, Johannesburg on Wednesday evening, Ramaphosa said some were attempting to appropriate the democratic movement, along with its history, symbols and policies in pursuit of factional interests.

“We have now become a country of many slogans where everyone wakes up and comes up with a slogan,” said the deputy president.

His views echo sentiments expressed by the SACP on calls for radical economic transformation.

Recently, the calls were made largely by the ANC’s Youth League and the Women’s League in the lead-up to a controversial Cabinet shake-up by President Jacob Zuma, which saw the axing of Pravin Gordhan as finance minister.

The SACP, following its central committee meeting in February, said the calls were nothing but rhetoric to further enrich the elite.

The deputy president, who had been vocal in calls to fight against corruption, told black business leaders that they would never compromise on the fight against “corruption, patronage and rent seeking”.

‘The usual suspects’

“We will also not allow the institutions of our state to be captured by anyone, be they individuals, be they families that are intent on narrow self-enrichment,” Ramaphosa said.

The deputy president admitted that government continued to disappoint members of the black business community by continuing to do business with “the usual suspects”, referring to white-owned and big businesses.

“It is not correct that our black professionals, be [they] lawyers, be they accountants, be they asset managers, be they engineers, should languish in inactivity,” he said.

Ramaphosa said government would move to correct the error of overlooking black business and create systems to monitor the development to ensure it is actually being addressed.

The deputy president called on the different sectors to put the needs of South Africans first, especially those who are marginalised in the country.

“Whenever you go through the length and breadth of our country…you see a long face, you will see the long face of an African woman because she’s black, because she’s poor,” he said.

Ramaphosa said black women had not benefitted from the economic opportunities which South Africa fought for.

He said they were part of the many who experienced social marginalisation and economic exclusion.

WATCH: Ramaphosa: Time to move beyond lamentations and complaints

South Africa – how Guptas laundered kickbacks millions

Huffington Post

Guptas ‘Laundered’ Kickback Millions — Here’s The Evidence

A year-long investigation points to an intricate system President Jacob Zuma’s friends, the Gupta family, allegedly used to extract bribes from companies doing business with a state institution.

08/12/2016

Evidence of millions flowing to a Gupta company has tied the family directly to an apparent racket of shaking down companies that sought state contracts.

For more than a year, amaBhungane has investigated how a letterbox company called Homix secreted away hundreds of millions; apparent kickbacks from companies doing business with Transnet, the state-owed transport operator.

There were signs all along that this had something to do with the Guptas. Homix’s self-proclaimed chief executive used to manage a Gupta company. Some of the money flowed to a Hong Kong firm that shared an address with a Gupta lieutenant’s companies.

Now, papers filed in the High Court in Johannesburg have provided direct evidence of Gupta involvement: after Homix was exposed, a seemingly round 10% of the first year’s fee on another big Transnet contract flowed to Gupta-owned TNA Media.

The amount, R17,1 million, was allegedly laundered through two companies on the strength of a backdated contract and bogus invoices before arriving at TNA, which publishes The New Age, court papers show.

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The latest evidence adds substance to the claim at the centre of the “state capture” debate: that the Guptas squeeze kickbacks from companies doing business with the state by using their political connections and officials they have deployed or bought.

We fully respect genuine media enquiries but will no longer reply to … amaBhungane.Gupta family

The Gupta family did not reply to questions this week, saying via a spokesperson: “AmaBhungane has consistently printed innuendo, speculation and lies about the Gupta family, its businesses and its friends. We have replied in good faith many times, but still suffer from total rubbish being printed. We fully respect genuine media enquiries but will no longer reply to … amaBhungane.”

Transnet denied wrongdoing, saying it was “confident in [our] processes”.

The emergence of Homix

The story so far starts in early 2014 when Homix made contact with telecoms provider Neotel. In a letter, it offered to land Neotel a Transnet IT equipment contract — in return for which it wanted 10% of the contract value.

Despite internal misgivings, Neotel paid Homix R35 million and landed the contract, worth over R300 million.

During August 2014, an even bigger prize came up. Transnet nominated Neotel as preferred bidder in a tender for a wide suite of network services, saying that it would get the contract if terms could be agreed by a December deadline.

With two weeks to go, Transnet withdrew from the negotiations without giving reasons, according to information from an investigation later ordered by Neotel’s board. In apparent desperation, Neotel reached out to Homix again.

A single person used to come in irregularly, generally after hours.

A Neotel employee told the board’s investigators that Homix again demanded 10%. Neotel bargained it down to 2% of the R1.8 billion contract value — R41 million including VAT.

Transnet returned to the negotiating table and Neotel got the contract.

There can be little doubt the payments were kickbacks. Homix was not a sophisticated consulting business whose work could justify millions in fees. When amaBhungane visited its Wierda Park, Centurion office address last year, we found a locked blue door abutting a latrine in a neglected office block.

amaBhungane

amaBhungane

A neighbour said a single person used to come in irregularly, generally after hours.

Homix’s only registered director, Yakub Bhikhu, was hard to trace. When someone claiming to be him finally answered a phone number stuck to the blue door, he did not respond to questions.

However, when the Neotel investigators started asking questions, one Ashok Narayan identified himself as Homix’s chief executive and tried unsuccessfully to convince them that the company had done real work for Neotel.

Narayan was a former managing director of Gupta IT company Sahara Systems.

amaBhungane

The Homix laundry

Homix bank records later seen by amaBhungane confirmed the impression that it was a front to launder kickbacks, not a legitimate business.

The records showed minimal office and no salary expenses. But they did show money flowing in and out of Homix at an astounding rate: R144 million in and R189 million out over just six months.

The inflows consisted largely of transfers from Neotel and four other companies, each of which benefited from Transnet contracts.

Almost all of the outflows went to Bapu Trading, a company more obscure even than Homix. There the trail went cold.

But a month later, in May 2015, Homix made 16 transfers totalling about R66 million to two Hong Kong companies, according to an official report seen by amaBhungane.

The Reserve Bank got suspicious, as the outflows did not match claimed imports. It froze the last three transfers at the end of that month.

One of the two Hong Kong companies on the receiving end, Morningstar International Trade, shares a registered address with companies formed by Gupta lieutenant Salim Essa.

“Confinement” is Transnet’s term for appointing a supplier without a competitive tender.

CCTV contracts

During this entire history, two more very large contracts came up at Transnet, this time to install CCTV cameras at ports. Again they went to Neotel, and again 10% appears to have been laundered.

But this time it ended discernably in a Gupta account. It went like this:

In May 2014, Transnet approved the confinement of the first CCTV contract, worth R329 million, to Neotel. “Confinement” is Transnet’s term for appointing a supplier without a competitive tender.

Nine months later, on February 20, 2015, Transnet management recommended confining a second CCTV contract to Neotel too, Transnet procurement records show.

The timing was interesting. The day before, Neotel records show, Neotel had signed a “business consultancy agreement” with Homix finally to give effect to its promise to pay Homix R41 million to get the unrelated Transnet network services contract.

Transnet notified Neotel that it had won the second CCTV contract, worth another R505 million over three years, at the end of March 2015, Neotel records show. Two weeks later Transnet formally placed the order with Neotel.

Neotel in turn subcontracted a CCTV specialist company, Technology and Procurement Holdings, better known as Techpro.

Homix exposed

If Neotel or Techpro had promised a kickback on this latest contract too, paying it via Homix would have been risky.

In mid-April 2015, when Transnet placed the CCTV order, Neotel’s auditors were crawling all over the earlier Homix payments. They blew the whistle to Neotel’s board, which commissioned an investigation that ultimately led to Neotel’s chief executive and chief financial officers resigning.

And the air was not about to clear. By the end of April, Neotel’s auditors had reported the Homix payments to the Independent Regulatory Board for Auditors, which in time notified other authorities, including the Hawks.

By the end of May, the Reserve Bank had frozen Homix’s remittances to Hong Kong.

Wanted: a new kickback channel

So if a kickback could not be paid via Homix, then who?

The answer appears to lie in the dirty washing of financial advisory firm Regiments Capital, hung out to dry in rancorous litigation between its directors at the Johannesburg High Court.

On June 4, 2015, days after the Reserve Bank froze Homix’s transfers to Hong Kong, Wood received an email from Narayan — the former Gupta manager and self-identified Homix chief executive.

Directors Litha Nyhonyha and Niven Pillay on the one hand, and Eric Wood on the other, fell out after Wood sided with the Guptas and Essa when a Gupta offer to buy Regiments fell through.

Though Wood joined Essa in the competing Trillian Capital Partners this year, the two sides are still trying to have each other removed from Regiments’ board.

In an affidavit filed last month, Nyhonya describes, and attaches, evidence he says was discovered after Wood left.

What it shows is this:

On June 4, 2015, days after the Reserve Bank froze Homix’s transfers to Hong Kong, Wood received an email from Narayan — the former Gupta manager and self-identified Homix chief executive.

Narayan asked Wood to get Regiments to invoice Techpro, the Neotel CCTV subcontractor, for R17,1 million. Wood complied.

The next day Narayan emailed Wood again, attaching three invoices, also totaling R17,1 million, from TNA, the Gupta media company, to Regiments. The TNA invoices purported to be for Regiments advertising in The New Age.

Next, Narayan emailed Wood an agreement purporting to be between Regiments and Techpro. It was already signed by Techpro and backdated five months to January 2015.

The agreement provided justification, on paper at least, for the Techpro payments to Regiments, saying Regiments would do “cost analysis and financial modelling” for Techpro “in respect of the second phase of CCTV installation at Transnet”.

amaBhungane

‘Fictitious transactions’

Nyhonyha states in his affidavit that Regiments did not advertise in The New Age and that Regiments did not provide the claimed services to Techpro. Wood, he charged, “knowingly allowed Regiments to be used as a conduit for an entirely fictitious set of transactions” to launder money from Techpro to TNA.

Wood denies this, saying his version will be provided when he files a replying affidavit.

But Nyhonyha’s version is supported not only by the emails, invoices and backdated contract annexed to his affidavit, but also by a Regiments bank statement which shows the symmetrical flow of R17,1 million from Techpro to Regiments and Regiments to the Gupta company on two consecutive days.

When the R17,1 million washed up at TNA, it not only swelled the Guptas’ purse but gave the clearest indication yet that they were the true beneficiaries of the Homix kickback laundry.

The backdated contract, perhaps carelessly in retrospect, tied the R17.1 million payment to the second Transnet CCTV contract. The amount also ties back neatly back to it.

Neotel records show that it recognised R150 million in revenue immediately on getting the contract from Transnet.

R17,1 million — R15 million excluding VAT — is a round 10% of that first year’s revenue.

And so, when the R17,1 million washed up at TNA, it not only swelled the Guptas’ purse but gave the clearest indication yet they may have been the true beneficiaries of the Homix kickback laundry.

amaBhungane

Responses

Narayan and Essa did not respond to requests for comment.

Wood said via a spokesperson: “Suffice to say that all of the allegations made by his former partners are strenuously denied and will be comprehensively traversed in his answer to the court papers which his attorneys are presently preparing on his behalf and which will be filed in short order.

“It would be improper and possibly prejudicial to his case to answer your questions prior to the filing of his answer.”

He also said he “would advise that these matters” be left to an independent investigation led by Advocate Geoff Budlender, appointed by Trillian chair Tokyo Sexwale.

“As you can imagine it is quite a shock getting this kind of information and we’ve sent it to [our attorneys] to investigate further.”

Techpro manager Craig Smith said about the allegations contained in the court papers: “As you can imagine it is quite a shock getting this kind of information and we’ve sent it to [our attorneys] to investigate further.”

He added: “Whether the insinuations that you are making are true or not true I don’t know…. If there is wrongdoing we want to know about it.”

Neotel chair Kennedy Memani said that during the company’s initial investigation the board “took all the necessary steps on the basis of what came out”.

He said he did not want “to go back to that debate … unless anything else comes out”.

A Transnet spokesperson said the company was “confident in its processes… In addition, Transnet was advised by Neotel that an independent investigation commissioned by Neotel revealed no wrongdoing or corruption by Transnet or any of our executives”.

“Please note that Homix is not a Transnet supplier. All matters related to Homix should be directed to Neotel. Transnet has never engaged with Homix or its executives.”

He said the confinement of the CCTV contracts was justified by Transnet’s urgent need to replace outdated CCTV equipment to comply with international standards and not lose its status as a ports authority. Neotel was chosen as service provider as the existing infrastructure belonged to Neotel and “the need to integrate new and existing equipment and systems was crucial”.

The amaBhungane Centre for Investigative Journalism, an independent non-profit, produced this story. Like it? Be an amaB supporter to help it do more. Sign up for its newsletter to get more.

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MORE: Gupta Gupta Money Laundering Evidence News

South African public prosecutor wants fund to probe Gupta-Zuma links

Reuters

South African Public Protector Thuli Madonsela said on Tuesday she wants more resources to investigate whether President Jacob Zuma allowed a wealthy business family to decide on cabinet appointments.

The scandal surrounding the Gupta family took a dramatic turn earlier this year after deputy finance minister Mcebisi Jonas said they had offered him his boss’s job, an allegation that led to calls for Zuma to resign.

Madonsela told reporters she was looking at “specifically whether or not the government of South Africa and specifically the president unlawfully allowed the Gupta family to choose ministers and other occupants of high office.”

Zuma has denied Jonas’ claims, saying only the president appointed ministers, in line with the constitution. The Guptas have denied influencing Zuma, saying they were pawns in a political plot against the president.

When it first broke, the affair threatened to shake Zuma’s hold on his ruling African National Congress party. But the president won the backing of its top decision-making group, which is stacked with his loyalists, and the party has since set aside the Gupta issue.

Madonsela, the country’s anti-corruption watchdog, did not say what additional resources she required to carry out the investigation, which she said she hoped to complete before her term ends in October.

The Public Protector’s office was also investigating whether there was “unlawful awarding of government contracts and licenses to the Gupta businesses”, she said.

The Guptas, who moved to South Africa from India after apartheid fell in 1994, run businesses ranging from uranium and coal mining to media and information technology.

DEATH THREATS

Madonsela has received public support in South Africa for taking Zuma to task over the 240 million rand ($16 million) of state money spent upgrading his private home.

She was vindicated in March when the Constitutional Court, the highest court in the land, said Zuma had breached the constitution by ignoring her recommendation that he repay some money that was spent on non-security upgrades. Zuma has since then agreed to hand back some of the funds.

Madonsela said she was also investigating whether a surveillance unit set up at the national revenue service was above board. The revenue agency was led at the time by Finance Minister Pravin Gordhan.

Police have said they are not investigating Gordhan as part of their probe into the activities of the spy unit. Madonsela said her office was “wrapping up” its investigation of the unit, but gave no details.

She said although she had faced death threats, smear campaigns by targets of her investigative work and claims by some politicians that she was a CIA spy, she had no regrets about taking on the job.

“There are a few deviants who decide to play the person as opposed to the ball. They know we don’t make the rules – we enforce them,” she said.

“More recently it has been a case of setting a fire behind the guardians of democracy or the watchdogs. so then you are distracted by the fire behind your back.”

($1 = 14.8209 rand)

(Additional reporting by Tanisha Heiberg; Editing by James Macharia and Mark Trevelyan)