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Madonsela conducted Absa probe mostly on her own

Jan 16 2017 14:58
Jenni Evans, News24 with Fin24

Cape Town - Former public protector Thuli Madonsela did most of the work on the Absa R2.25bn bailout probe by herself because staff were against it and already overworked, she told the Cape Town Press Club on Monday.

But she denied there was any ulterior motive into the investigation, which her staff had considered to be ''out of time''.

Explaining why the probe took so long, she said the main problem was resources.

She said she was just as surprised as anybody else that the report was leaked electronically because when she worked as public protector, drafts were never sent electronically as a safeguard, and never the entire report to one person.

She would not say whether the leaked version was the one she worked on before leaving last October, or that of her successor Busisiwe Mkhwebane, and would not discuss its contents at all during a talk entitled ''An Alternative State of the Nation'' at the club.

The investigation was conducted after Advocate Paul Hoffman approached Madonsela and asked if she had jurisdiction to probe the claims. She believed the office did.

However, she chose the Absa aspect of Hoffman's concerns as ''low hanging fruit'' because of the resource restraints she faced.

Madonsela emphasised that she would not discuss any aspects of the report.

The report apparently recommends that Absa should pay back R2.25bn it received as part of an unlawful apartheid-era bailout.

The outstanding R2.25bn pertains to the bank's acquisition of Bankorp in 1992. Bankorp started receiving assistance from the South African Reserve Bank (Sarb) in 1985. In a statement, Absa indicated that all obligations to the Sarb had been discharged in full by October 1995.

The bank said the premature release of the report is “regrettable”. It said the Davis Panel of experts appointed by former Sarb governor Tito Mboweni in 2000 found that Absa’s shareholders did not derive any undue benefit from the Sarb’s intervention, and as such no claim of restitution could be pursued against Absa.

“It must be noted that the matters and events under investigation occurred during the period 1985 to 1995, 21 to 31 years ago,” the bank said in a statement.

“The testimony provided by current Absa senior executives to the public protector was based on records available to the bank’s current management, as none of them have personal knowledge of events at the time.”

Sarb governor Lesetja Kganyago said there are a number of errors in the public protector’s leaked preliminary report. Last week he told Radio702 that the Sarb is going through the report with their lawyers.

“We are checking it for factual accuracy,” he said. “We have already spotted a number of errors. We are going through the report with our lawyers...”

Mkhwebane said her report was only preliminary and she was still waiting for feedback from the implicated parties, which might change the contents of the report drastically, the Mail & Guardian, which leaked the report, said.

The timing of the report's release has brought into question whether Absa is being challenged over closing Gupta-linked accounts.

Absa was one of the four major banks in South Africa which closed the accounts of Gupta-linked business Oakbay and its subsidiaries, in February 2016.

The bank recently put forward reasons for closing the accounts in an affidavit filed at the North Gauteng High Court. Among these include the classification of Gupta-owned companies as politically exposed people  following a review of the accounts.

sarb  |  absa  |  thuli madonsela  |  public protector


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