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Patel to testify on pension money

Oct 16 2011 13:58 Nellie Brand-Jonker

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Johannesburg - Economic Development Minister Ebrahim Patel has been served with a summons to testify in the liquidation inquiry into the Canyon Springs Investments 12 company.

The company received a loan of more than R80m from the Trilinear Empowerment Trust (TET), in which the monies of five clothing workers' retirement funds had been invested, said Tony Canny, a forensic investigator of the Eversheds legal firm. He was appointed by the Sactwu trade union.

About R420m of clothing workers’ retirement funds was invested in TET during the period that Patel was general secretary of Sactwu.

Barnabas Xulu of Xulu Liversage Incorporated - the legal representatives for the TET trustees - which submitted the application for liquidation on behalf of Canyon Springs, apparently insisted that Patel also give witness.

A summons to testify was apparently also served on Wayne van der Rheede, deputy general secretary of Sactwu, who was allegedly suspended because of the TET saga.

Economic Development Deputy Minister Enoch Godongwana and his wife, Thandiwe, have already testified. They are current shareholders in Canyon Springs through a family company, Tyalibongo. Their evidence has not been completed and the media is prohibited from reporting on it.

Until he became a minister Godongwana was also a director of Canyon Springs and a director of its wholly-owned subsidiary, Pan African Benefit Services (PABS).

Mohan Patel, a director of Canyon and PABS, and a former chief executive, was last week asked by Advocate Gavin Woodland, who is leading the interrogation, whether Godongwana should have known that the money had come from the clothing workers' retirement funds. Patel (who has no connection to the minister) said that to him it had been self-evident.

Godongwana has so far denied any knowledge about it.

Patel alleged that Richard Kawie, also well known in clothing trade union circles, had actually pulled the strings at Canyon Springs and decided where the company should invest.

Patel and others had been recruited by Kawie to work for Canyon. He said he had not found it strange that Kawie had taken decisions because Kawie had claimed to have a mandate from the ANC and Cosatu to establish Canyon Springs.

Patel also said that was why he had not thought it strange that Canyon Springs had received an unconditional loan without a signed agreement.

On Monday Kawie will have the opportunity to put his side of the story to the commissioner.

Companies belonging to Kawie allegedly also received money from Pinnacle Point - which is now also in provisional liquidation and to which R260m of TET’s money went.

Another important witness is Sam Buthelezi of the Trilinear group of companies.

One of the Trilinear subsidiaries had been responsible for managing TET’s financial assets.

It was submitted into evidence that another subsidiary, Trilinear Specialised Finance, had earned millions in commission from money coming from TET following various transactions. This included about R25m (or around 30%) of the money lent to Canyon Springs, said Canny.

Fourteen files containing information have so far been put together by Canny and his investigative team for use in the inquiry.

At the end of September Sake24 questioned Minister Patel on TET, enquiring whether he had any knowledge of the retirement money that had been in the trust, and the investments made with it. These questions remain unanswered.

 - Sake24

For more business news in Afrikaans, go to Sake24.com.



 
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