South Africa: Zondo ‘State Capture’ report exposes fraud and corruption

By Jaysim Hanspal

Posted on Wednesday, 5 January 2022 19:29
Former South African President Jacob Zuma sits in court during his corruption trial in Pietermaritzburg
Former South African President Jacob Zuma sits in court during his corruption trial in Pietermaritzburg, South Africa, October 26, 2021. Jerome Delay/Pool via REUTERS

This week, after more than three years of investigation and over 300 witnesses, South Africa's Judicial Commission of Inquiry has published its investigation into allegations of state capture, corruption, and fraud in the public sector, during former President Jacob Zuma's nine years in power from 2009.

The report, which details the result of State Capture within South African Airlines (SAA) and other aviation matters, will release further volumes to deal with different state-owned enterprises (SOEs) to “enable anyone who wishes to read a part of the report that relates to a specific SOE or topic to take the particular volume and read about that SOE or topic,” said Chief Justice Raymond Zondo on Tuesday 4 January.

Proceedings spanned more than 400 days, with more than 300 witnesses appearing – and presenting more than 1.7 million pages of documents as evidence.

“Approximately 1,438 persons and entities were implicated by the evidence led before the Commission,” said Zondo.

‘A cloud of fear’

Former SAA chair Dudu Myeni and close personal friend of Jacob Zuma refused to answer questions before the state, citing self-incrimination. However, the report shows that Myeni and her co-Board member, Yakhe Kwinana, chairperson of South African Airways Technical (SAAT), were responsible for a severe “decline in the quality and effectiveness of the governance of SAA from 2012 onwards.”

As stated in OUTA’s (Organisation Undoing Tax Abuse South African) press release,” the State Capture Commission report is damning on Myeni’s role in the destruction of SAA.” It adds: “The fact that she got away with this for so long is an example of how accountability has failed society at every level of government, while friends of ex-President Zuma benefited handsomely for their various roles played in the looting.”

OUTA and the SAA Pilots’ Association worked together to present evidence on Myeni.

As chair of the SAA, Myeni promised “to observe and comply with the principles and provisions of all legislation relevant to South African Airways” as well as “to observe the highest standards of integrity and probity in the execution of my responsibilities”.

Myeni had operated SAA “under a cloud of fear, intimidation, secrecy and paranoia, when a public entity should be operated transparently and with accountability to the South African people who fund its operations”, said Zondo.

Myeni is further accused of acting in an intimidating fashion towards board members and staff and acting for the benefit of a “select few”, according to the 874-page report. She reportedly “would remove any executives who refused to carry out her instructions.” This effectively acted as a gateway to large-scale corruption and looting, with evidence of some companies turning a blind eye, and others victims to this insidious behaviour.

Through the testimonies of several ex-SAA employees, such as Tuli Mpshe, Dr Masimba Dahwa, Cynthia Stimpel and Phumeza Nhantsi, “the Commission heard how Myeni had no respect for procurement procedures, policies and the prescripts of the Public Finance Management Act,” wrote OUTA.

It adds: “Evidence showed how Myeni was not moved by instructions from ministers, National Treasury or the Department of Public Enterprises.  Her actions not only led to several employees losing their jobs, but also to irregular and wasteful expenditure of hundreds of millions of rand in taxpayers’ money.”

Charitable corruption

One organisation in particular is the Jacob Zuma Foundation. It is accused of directly funnelling state funds to the charity with help from Myeni.

Money flowed from the Free State provincial government, in the form of a housing project, to VNA Consulting. That company, the commission heard, in turn, made payments to Premier Attraction, a company associated with Dudu Myeni’s son Thalente Myeni, and to the Jacob Zuma Foundation, except when it went – in cash – to Myeni herself.

On its website, it reads, “The Jacob Zuma Foundation strives to respond effectively, efficiently and within its valued accountability, to the needs of beneficiary communities.” Zondo’s report recommends further investigation to establish these suspicions, among others, that suggest Myeni and Jacob Zuma worked closely to ensure that the SAA adhered to Zuma’s vision.

As a result of this inquiry, Myeni and many others within the SAA may be prosecuted in the days to follow.

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