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Accountability Monitor: Tracking the fight against corruption

In light of recent arrests related to corruption and state capture, in this developing story, we’ll be keeping tabs on the corruption-related arrests in both the public and private sector, how the NPA does its work, and how the Hawks are handling the drive to root out corruption. 

Several high profile arrests, including people allegedly involved in state capture, have taken place over the last few weeks, and the NPA seems to be on a roll. And it’s taking a bunch of bad guys down with it. This is what we like to see. 

Before we jump ahead, let’s remind you who the NPA is and what it does

The NPA is an organ of state, part of the state but independent from government, tasked with making sure that criminals are prosecuted. It’s quite an important structure in the strengthening of South Africa’s democracy. The NPA’s had more than a few rough years with some questionable leaders, so it has lost some credibility. By the time Cyril Ramaphosa became president in 2017, it was painfully apparent that something had to change if our criminal justice system was going to work properly. 

Enter one Advocate Shamila Batohi, who was appointed as the head of the NPA less than two years ago, to restore confidence and really crack the whip. It took some time til we saw her in action, but now that we’ve seen arrests in high profile corruption matters, we can almost guarantee that this is ONLY the beginning. 

And we’re here to keep receipts. 

October 20 update:

The Hawks are expected to make even more arrests related to Covid-19 corruption this week, reports News24. Hawks head Godfrey Lebeya reportedly told Parliament this week that the elite crime fighting unit within the police is investigating over 80 000 illegal payments related to Covid-19 corruption.

He said the Hawks were making excellent progress, and that their investigations were underway in all provinces, with help from other law enforcement agencies.

October 19 update:

The Zondo commission of inquiry has Jacob Zuma and his former allies in its sights, reports the Sunday Times. Zuma, Julius Malema, and even police minister Bheki Cele are reportedly under scrutiny by the commission’s investigators, who have subpoenaed their bank records. The banks have reportedly cooperated, although Zuma, through his lawyers, says he does not know anything about this.

Zuma previously said the commission is political, and is intended to achieve political ends. Zondo has issued a summons to force Zuma to appear at the commission, as the former president has refused to do so.

October 14 update:

Latest: Angelo Agrizzi, the former COO of Bosasa was denied bail today at the Palm Ridge Magistrate’s Court because the State believes he’s a flight risk. The presiding magistrate Philip Venter said he was satisfied with the State’s case that Agrizzi had the financial means to set up and sustain a comfortable lifestyle outside the country’s borders.

Former ANC MP Vincent Smith and former Bosasa boss Angelo Agrizzi are due back in court. Smith is accused of accepting bribes from Agrizzi in exchange for stopping Parliament’s committee on correctional services from probing dodgy government tenders that Bosasa received. Smith has denied that Agrizzi’s so-called gifts to him were bribes.

The country’s second most senior cop, Deputy National Commissioner, Lieutenant-General Bonang Mgwenya, has been arrested for corruption. Mgwenya appeared in court this week with 14 others including former national commissioner Lieutenant-General Khomotso Phahlane, on charges including fraud and money laundering.

They are accused of tender corruption.

October 12 update:

The cooperation of various bodies has been key to the latest round of arrests. The Mail & Guardian reports that Hawks officers already working on some cases related to state capture were seconded to the Investigative Directorate (ID) within the NPA, which is specifically tasked with investigating state capture. The ID has reportedly worked closely with the State Capture Commission of Inquiry, too.

Read the paper’s full behind-the-scenes analysis of the state capture arrests here.

According to the Mail & Guardian:

“This is a government initiative, we are [all] working for the [same] government,” said Hawks head General Godfrey Lebeya

“Our investigators are highly skilled and they understand what they’re investigating. It’s not less than four full colonels, captains, and seasoned investigators,” he added. 

“The cooperation of the agencies  has added more value to the cases. It has increased turnaround times amongst law enforcement agencies and there’s better coordination and that strengthens investigations and the criminal prosecution process,” said NPA spokesperson Sipho Ngwema.

Update:

The VBS case has been postponed to January 2021. Seven people allegedly involved in the looting of the bank appeared in court on last week, SowetanLive reported. More arrests are reportedly expected. According to the publication, the people who appeared include:

  • Former VBS chairperson Tshifhiwa Calvin Matodzi
  • Former CEO Andile Ramavhunga
  • Former treasurer Phophi Mukhodobwane
  • Former non-executive board members Ernest Nesane and Paul Magula
  • The former CFO of the SA Police Service Phalaphala Avhashoni Ramikosi
  • Former KPMG engagement partner Sipho Malaba.

October 8 update: 

In the past two weeks three really high profile arrests of individuals allegedly involved in so-called state capture, and another individual pleading guilty for financial crimes in the VBS Mutual Bank looting scandal.

Philip Truter 

Philip Truter was the Chief Financial Officer of VBS Mutual Bank. On Wednesday, October 9, he pleaded guilty to financial crimes, including corruption, money laundering, fraud, theft and racketeering at the bank. In a word: looting. He was sentenced to 10 years in jail, three of which have been suspended after he negotiated and made a deal with the cops. He will effectively spend 7 years in jail for his crimes. 

What did he do?  

Philip Truter was one of the executives who allegedly facilitated and helped to cover up the theft of about R2 billion from the bank. Truter confessed that “he was a participant in the manipulation of VBS’s banking systems and the fraudulent misrepresentations contained in its 2017 annual financial statements”, according to the Business Day. A report commissioned by the Reserve Bank called the “Great Bank Heist”, published about three years ago, details how the bank, and the monies of pensioners who invested there, were stolen just to fatten the wallets of the big boys – not just the executives, but the red berets too, allegedly. (That would be the EFF. They have denied getting stolen VBS funds.) 

Here’s why Truter’s arrest is SO significant in the bigger scheme of things:

A) it means the NPA is making serious headway in uncovering the financial crimes. It’s been hamstrung by a lack of forensic skills for some time, so this means that it might be turning a corner. 

B) it opens the doors to more arrests. On Thursday, Truter’s co-accused: former VBS chair Tshifhiwa Calvin Matodzi, CEO Andile Ramavhunga, former treasurer Phophi Mukhodobwane, former nonexecutive board members Ernest Nesane and Paul Magula, the former CFO of the SA Police Service, Phalaphala Avhashoni Ramikosi, and former KPMG engagement partner Sipho Malaba, appeared in court. The case has however been postponed to 26 January 2021 to allow the state more time to make additional charges and arrests, Daily Maverick reported. 

Truter was able to strike a deal with the courts, where he said he WILL drop all the details on who did what to cause the downfall of VBS Mutual Bank. Read what amaBhugane had to say about it here. (If we were involved, we’d be pretty scared). 

Next, three (of maaaaany) guys involved in the state capture project

(To read our full explainer on these arrests, click here)

Briefly, this is who they were. 

1. Thoshan Panday 

This 49 year old Kwa-Zulu Natal businessman and some police officers were arrested on Friday, October 3 for allegedly conspiring to rig a tender he received to provide accommodation to police officers during the 2010 Soccer World Cup. He promised the corrupt cops some pretty neat ‘gratifications’, including cash, luxury accommodation at fancy hotels, money used to purchase land, flights, and cars, to swing the tender his way.

Panday broke several laws, but it was kept under wraps thanks to his relationship with the police and number 1 A.K.A Prez. Jacob Zuma. He evaded any kind of legal recourse. But, you know what they say, you can run but you can’t hide. 

Panday appeared alongside the police officers allegedly involved on October 5. He was released on R100 000 bail. (Crime is really not worth it, man). 

2. Vincent Smith

Vincent Smith was supposedly ‘an honest man’ – a senior member of parliament with a solid reputation for rigourous law-making, but he let this title slip away after getting involved in some corrupt dealings alongside Bosasa’s Angelo Agrizzi. Smith allegedly received ‘gratifications’ (a fancy word for bribes), from Agrizzi to influence his position and benefit Bosasa (now known as African Global Operation). 

Bosasa allegedly paid Smith R40 000 a month to stop probing the controversial contracts in Parliament, and his daughter’s tuition was allegedly paid for by the firm. Smith didn’t think of the payment as a bribe but as a personal loan from Agrizzi for his daughter’s tuition (with friends like these…) Smith turned himself in and appeared in court on October 1. He believes the evidence before the court will vindicate him. 

3. Edwin Sodi 

Picture this: a huge driveway lined with Ferraris, Bentleys and other fast cars, against a background of huge, glass windows, with a water feature that doubles up as a pool and an enormous house so big, it might be touching the sky… okay, that last bit is a bit dramatic, but you get the picture. This was the lifestyle of Bloemfontein businessman Edwin Sodi – until this week when the assets were seized by the state, Daily Maverick reported. 

He was allegedly at the helm of a business venture, which got paid up to R230 million to do an audit of houses that still had asbestos roofs in the Free State. But the work he did only amounted to about R21 million. And the rest of the money? Well…

Sodi told the state capture commission of inquiry that he gave money to ANC officials and senior government people, but there was nothing criminal about these so-called donations.

This is a developing story…

By Aarti Bhana and Sarah Evans