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Cape Town – The Department of Water and Sanitation (DWS) has denied any involvement in transactions that saw money flow from a government department to a group of companies and then on to former SA Revenue Service chief executive for business and individual tax Jonas Makwakwa.
The money trail is included in a report by law firm Hogan Lovells, which was made public last week. Hogan Lovells was tasked with conducting an independent investigation into Makwakwa in 2016.
Makwakwa was suspended from the revenue service in September 2016 while Hogan Lovells conducted their investigation. He was found not guilty in a subsequent disciplinary hearing and returned to the tax agency in November 2017, only to resign in March 2018.
The report includes a section by PwC, which concerns a series of transactions first flagged by financial watchdog the Financial Intelligence Centre (FIC) which led to Makwakwa's original suspension.
According to a schemata prepared by PwC, money which originated with the Department of Water Affairs and Forestry eventually ended up in Makwakwa's account on 9 April 2015, after passing through a number of companies. He then used a portion of the money to service payments for a Mercedes-Benz.
Makwakwa has consistently denied any wrongdoing.
It was not immediately clear why the department was referred to as the Department of Water Affairs and Forestry. In 2009, the Department of Water Affairs and Forestry was divided, with forestry transferred to the Department of Agriculture. The current DWS was established in 2014.
DWS spokesperson Sputnik Ratau told Fin24 that the department had not provided any money to Makwakwa himself as the director of any company which was servicing the department.
No connection
"There is no connection between ourselves and these transactions. We also do not have anything to do with the projects that are subject to the Hogan Lovells report and the transactions in which Mr Makwakwa was mentioned," said Ratau.
He also said it was malicious to insinuate that the department was linked in any matter involving Makwakwa in his capacity as a SARS official.
"The latest report released by law firm Hogan Lovells suggests that in 2015 the department knowingly and willingly transferred R17.8m to New Integrated Credit Solutions (NICS) that ended up in Makwakwa’s personal account," a statement from the Department of Water and Sanitation said on Friday.
Ratau said, however, that the department hired NICS as the service provider for the department and as its debt collector for an 11.5% commission.
"Indeed, in 2015 the department paid NICS the above percentage and the two-year contract came to an end. The department wishes to reiterate that it had no links with the former SARS senior executive or control of how NICS used the money after receiving payment from the Department of Water and Sanitation for services rendered according to a valid contract," he added.
He added the department denied any form of complicity in any possible acts of corruption on the matter.
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