‘No excuses’: Business calls for consequences for state capture fraud and corruption

Business is calling for consequences for the perpetrators of state capture fraud and corruption after reports last week that the National Prosecuting Authority is battling to access the evidence collected during the sittings of the Zondo commission.

Busisiwe Mavuso, CEO of Business Leadership South Africa, says in her weekly newsletter that she read with immense frustration of the National Prosecuting Authority’s (NPA) struggle to gain access to the evidence.

“The three-year-long commission, at a cost of almost R1 billion, delved into state capture and recommended many prosecutions over two years ago. The NPA has been attempting to take those recommendations forward and has been stymied by a lack of access to the millions of documents that the commission collected in its investigation.

“The department of justice, under Minister Ronald Lamola, did not provide full and complete access to the database. The department cited ‘administrative problems’ in providing access, but this issue has now been dragging on for years.”

Mavuso says this is simply unacceptable. “Naturally, questions arise whether the problem is in fact a lack of will on the side of the department and whether it is frustrating the NPA on purpose. This issue is imminently solvable: give the NPA a complete database of all documents. There must be no excuses.”

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Supporting rule of law critical for growth

She emphasises that business is strongly committed to the rule of law, saying it is critical for a business environment that supports growth. “That is why we support the criminal justice system through initiatives like Business Against Crime and our memorandum of understanding with the NPA that enables us to fund technical expertise to support the NPA in building its cases.”

The damage done to institutions through state capture was immense and we are still rebuilding, Mavuso says. “Our weaknesses in tackling crimes like money laundering and terrorist financing have landed the country on the grey list of the international watchdog the Financial Action Task Force (FATF).

“This is bad for the country and bad for business. Business cannot be done if there are no consequences for fraud and corruption. Our wider society also suffers enormously.”

She points out that the NPA is gradually making progress, as illustrated by the court appearance of Moroadi Cholota, the former personal assistant of former Free State premier Ace Magashule. She was successfully extradited from the US by the NPA to face charges of fraud, corruption and money laundering.

She will stand trial along with several co-accused, including Magashule, next year regarding the Free State asbestos scandal. Mavuso says this is one example of the many cases the Zondo commission gathered evidence about. “There are many others that could be progressing if the NPA was properly supported by other organs of the state.”

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‘Unemployment influenced the mood in the room’

Mavuso says on the day that the Quarterly Labour Force Survey was released last week, revealing an unemployment rate of 33.5%, the worst since Covid restrictions were in force, organised business met with President Cyril Ramaphosa to review progress in their joint initiatives through Business For South Africa.

“The unemployment figures obviously influenced the mood in the room and drove much discussion.”

According to Mavuso, the partnership has made much progress. “The electricity crisis is the clearest success point with the Energy Action Plan having driven reforms and interventions that have largely got us to the end of load shedding.

“The day after the meeting, amendments to the Electricity Regulation Act were signed into law by the president, marking yet another step forward in the major overhaul of the electricity system. The amended legislation enables the establishment of a competitive electricity market in which multiple suppliers can feed into the grid.”

It also substantially increases the penalties for anyone involved in the theft of cables who can now receive fines of up to R5 million and 10 years in prison. Both changes will be important in stabilising supply.

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Progress with logistics good, but progress is slow

Mavuso says the other area where much work is happening is logistics.

“Progress has been good but not as speedy as in electricity. A good plan was drawn up and agreed upon, which includes interventions such as the opening of infrastructure for the private sector to invest and operate, but progress has been slow. This was noted as a concern in the meeting and all partners committed to resolving the blockages, particularly at Transnet and accelerating progress.

“It was a great meeting in which the good progress was acknowledged, with credit given to the hard work of Eskom and the business team. A strong commitment was made to continue that progress. The dreadful unemployment figures provided ample evidence of the urgency to moving things forward.”