Madonsela suggests leaked Absa report could be ‘nefarious’

Former public protector Advocate Thuli Madonsela has warned that a leaked report into apartheid-era bailouts into mega-bank Absa could be used for “nefarious” purposes.

Addressing the Cape Town Press Club on Monday, Madonsela refused to be drawn into reports that her successor, Busisiwe Mkhwebane, altered her report into allegations that Absa unlawfully benefited from loans in breach of the country’s constitution and the Public Finance Management Act.

“I don’t know why it [the report] has been leaked at this stage. We had promised Absa and the Reserve Bank that we would share the provisional report with them quietly.

“How it ended up with other parties, I don’t understand … Will it be used for nefarious purposes? That is possible. From our side, it was never about using the report for purposes,” she said.

The timing of the leak of the draft document, first reported by the Mail & Guardian on Friday, has created a heated debate about its intentions, especially in the wake of the bank closing the accounts held by the controversial Gupta family and companies they are associated with.

Reserve Bank Governor Lesetja Kganyago has said they had identified several errors in the report, which was leaked before Absa could finish with its submissions and without Mkhwebane honouring the bank’s invitation to come and inspect confidential documents pertinent to the successful finalisation of her probe.

ALSO READ: Mkhwebane’s Absa probe has turned into a political football

In the report, Absa may be required to pay back R2.25 billion as interest from a bailout given to Bankorp before the bank was acquired by Absa in 1992.

The public protector reportedly plans to recommend that President Jacob Zuma consider establishing a commission of inquiry to recover the billions from other institutions mentioned in the Ciex report compiled by an asset-recovery agency contracted by the SA government in 1997 to probe public funds and assets allegedly misappropriated during apartheid.

Absa said last week it was “regrettable” that the preliminary report had been leaked before the bank had made further submissions and finalisation, saying it perpetuated the incorrect view that the bank was the beneficiary of undue SA Reserve Bank assistance.

“The Davis Panel of Experts appointed by former Sarb governor Tito Mboweni found that that Absa’s shareholders did not derive any undue benefit from Sarb’s intervention, and as such no claim of restitution could be pursued against Absa. We emphatically agree with this position and attach the full Executive Summary of the Davis Panel Report for reference.”

Absa has promised to cooperate with the office of the public protector around its purchase of Bankorp.