ANCYL leaders coining it - claim

Johannesgurg - ANC Youth League (ANCYL) leaders are using their political connections with senior government officials and the heads of state-owned enterprises to enrich themselves through the league’s growing business empire.

City Press has uncovered a scheme hatched last year which places new directors of the league’s controversial company, Lembede Investment Holdings, in line for a 30% share of all deals signed during their term of office.

Documents and sources show that the scheme revolves around creating several companies to front for the league – and making a few individuals rich.

The companies, in which Lembede holds shares through trusts, are getting tenders from government departments, a municipality and state-owned companies sympathetic to the youth league.

The league also resolved that there was a need for political intervention to open the market for itself in “hostile environments.”

The minutes of a February 2009 Lembede board meeting, where the scheme was hatched, disclose that the company’s chairperson and ANCYL treasurer-general, Pule Mabe, led the campaign for self-enrichment of individuals on the league’s ticket.

On Friday Mabe denied this and said there was an “overwhelming view by the board that they should be rewarded”.

"This board resolution was not even looked at by the shareholder because the league wanted the board to focus its attention on closing down Lembede.”

But two ANC members familiar with the board resolution said the resolution was never rescinded and is still in place.

According to the minutes of the February 2009 board meeting, Lembede’s then-CEO Lonwabo Sambudla was to be paid "10% of the value of transactions" signed by the company and its subsidiaries during his term.

Sambudla’s share was to be “accommodated in the mooted 30%”, the board resolved. This left 20% to be shared among the rest of the board members.

Sambudla failed to respond to written questions sent to him on Thursday.

Because Lembede had attracted negative publicity for its dodgy transactions with slain mining magnate Brett Kebble, new trusts were formed to front for the league and hold shares in 18 companies.

City Press has established that one of these companies, Review Printers, last month received a one-year contract for the “printing and supplying of general full-colour work in the Limpopo province”.

A status report of Lembede finances shows that the league holds a 30% stake in Review Printers through the South African Youth Development Trust – whose beneficiaries are registered members of the league.

Other Lembede companies in business with state-owned entities include:

» Kopano Travel, which managed the yearly choral music event for the South African Rail Commuter Corporation and the City of Johannesburg; and

» Motona Financial Services, which was to sign a contract with Eskom Pension Fund for financial brokerage. Motona was also awarded a contract for financial brokerage by state oil company PetroSA. The February 2009 minutes state that the contract was to be signed within two weeks and would raise a minimum income of R500 000 a year.

However, PetroSA spokesperson Thabo Mabaso said yesterday that the company did not have a contract with Motona.

The board further resolved that a committee including director Tumisang Kgaboesele and the league’s national executive committee member, Mduduzi Manana, should seek business opportunities from municipalities in the area Manana comes from.

Manana is an MP and hails from Ermelo in Mpumalanga.

A league member who knows of Lembede’s dealings said it “was disingenuous of them (new ANCYL leadership) to claim clean governance but go behind closed doors to try to enrich themselves”.

The board’s scheme also contradicts pronouncements made by the league and its president, Julius Malema, that it would close down Lembede.

Malema labelled Lembede’s former CEO, Songezo Mjongile, and former league member Andile Nkuhlu as “thugs”, and threats were made to have them charged for enriching themselves in the name of the ANCYL.

At the time, Malema said: “We can’t carry the same baggage with us. We can’t carry this problem. We are closing it down and then we are concentrating on other things.”

 - City Press