The judicial commission of inquiry into state capture continues with further Transnet-related testimony from former group treasurer Mathane Makgatho.
WATCH LIVE: State Capture Inquiry
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Mazibuko will continue his testimony on Monday.
When no response was received from Homix, a notice order and forfeiture was published in the government gazette and the amount of around R14m was forfeited to the State.
Homix never challenged the forfeiture.
Incorrect statements were made in declaration to transfer of monies, false or incorrect statements were provided to a dealer to purchase foreign currencies, are some of the topics Mazibuko says wanted answers from Homix on.
Director of Homix was invited to a meeting to explain the alleged contraventions of the provisions of the exchange control regulations.
The letter invites the director to a meeting where dubious payments, transfer of foreign currencies without permission by the treasury and money laundering would be discussed.
Homix never responded to the letter.
Documents were falsified and there was trade base money laundering by Homix, Mazibuko says.
Mazibuko is currently running through a list of transactions and payments from his evidence submitted to the commission.
Mazibuko confirms with Zondo that they can only pick up the transactions after the event, because it is only reported to SARB after it happens.
Mazibuko says banks “are the first line of defence, but they need to be vigilant. If they sleep, the money escapes.”
After laying down a very detailed foundation about how investigations into exchange control contraventions are conducted, Mazibuko now hones in on the details about transactions involving Homix, a reported “shell company”.
Mazibuko now tells the commission how exchange control violations are reported, investigated and dealt with. He earlier explained that the SA Reserve Bank (SARB) works very closely with SARS, and operates without fear or favour.
Mazibuko explains that not using foreign currency for the purpose that it was applied for (travelling, buying foreign goods, etc), is a contravention of exchange controls.
Mazibuko explains the purpose of exchange controls, mentions the 2008 “financial crisis” and the lessons that were learnt from that.
“The Minister of Finance is the custodian of the exchange control policy, we act in the advisory capacity because we deal with the market and all that, but all policy issues are taken by the Minister of Finance,” says Mazibuko.
Mazibuko further details the regulations of exchange controls.
‘I felt my life was at risk’ says ex-treasurer on resignation from ‘toxic’ Transnet
Transnet’s former group treasurer has testified that she resigned from the state-owned company in 2014, after the environment became too toxic for her to handle and she started to fear for her safety.
“I felt my life was at risk. I have four young kids, I am not going to play superwoman,” she told the commission.
The commission has been investigating allegations of state capture, corruption and fraud since August 2018.
Mathane Makgatho, continuing her testimony on Friday, told the commission how she time and again tried to convince then-Transnet CEO Brian Molefe against involving Gupta-linked advisory firm Regiments in organising a $2.5bn loan from the China Development Bank.
Mazibuko confirms he is currently employed at the SA Reserve Bank as the head of the financial surveillance department. “I’m responsible for heading the department that is responsible for implementing and administering exchange controls on behalf of the Minister of Finance,” says Mazibuko.
Back from the break, evidence leader Advocate Mokoena finishes his preamble, contextualising Mazibuko’s forthcoming evidence.
Mazibuko is sworn in.
Zondo calls for the lunch adjournment before Mazibuko’s testimony begins. A shorter lunch break has been called for, and proceedings resume at 13:45.
The next witness up is Mr Shiwa Elijah Mazibuko from the South African Reserve Bank. His legal team is also in attendance, and they are given the opportunity to place themselves on record.
Evidence leader Advocate Phillip Mokoena gives a preamble to Mazibuko’s testimony.
Makgatho wraps up her testimony, and Zondo thanks her for taking the time to come to the commission and give evidence.
A short adjournment is called to prepare for the next witness. Back in 5mins.
Makgatho says she felt unsafe and she has four children, and she was not going to play super-woman. Makgatho says she was advised to meet with one of the ANC’s top six, but she says she felt she did not have to.
Makgatho tells the commission about the circumstances surrounding her resignation.
Makgatho: “As I have indicated before, I have worked with Brian Molefe before, and I believe that he knows my technical ability. And I believe that he knows whether I’m a person to be trusted, or not to be trusted.”
Makgatho: “So, I think he was in between, and he was trying to bridge the gap between me and the GCFO, and he couldn’t get me to move from where I was. He knew that he couldn’t tell me directly and he knew that on the other side, this other team is also not moving…”
Makgatho: “We had engagements with him so many times in his office, where [there] would be bickering between me and Mr Singh, and he would try to mediate. And I think that this transaction was going to happen, but he just needed me to cross over.”
Back from the break, Makgatho’s testimony continues.
‘Certain car boots were full of cash’ ex-Transnet treasurer tells inquiry
“It was an open secret that certain [car] boots were full of cash”.
This was part of the testimony on Friday by the former Group Treasurer of Transnet, Mathane Eveline Makgatho, at the judicial inquiry into state capture.
The commission of inquiry has been investigating allegations of state capture, corruption and fraud since August 2018.
Proceedings adjourn for the tea break. Back in 15mins.
Makgatho says in a meeting with Regiments, set up by Molefe, she was told that she was the only one opposing the pricing method, and they were trying to “persuade” her, but she said she wouldn’t change her recommendation.
Makgatho was “shocked” to discover that the China Development Bank was now communicating directly with Regiments.
Makgatho says she travelled home from China with Anoj Singh’s suitcase, but she never once opened it and immediately handed it over to Singh’s driver at the airport.
Makgatho: “If we felt that the pricing was too excessive, the normal procedure was to terminate discussions and focus on other cost-effective facilities.”
Makgatho says when the meeting concluded, Singh asked for a private meeting with one of the Chinese counterparts, which she was not part of. Makgatho says that he said he was managing him and stressing that Transnet is interested.
Makgatho: “I just noted that he was a happy chappy after that meeting.”
Makgatho says that shortly after this, Singh’s travel plans had almost immediately changed and he told Makgatho that he would no longer be travelling home with her, but he would rather be going home via London.
Singh asked Makgatho to gather his luggage from his hotel room and take it back to SA with her.
Makgatho now tells the commission about a planned trip to Beijing, China, as well as Hong Kong and Singapore.
Makgatho says the trip was cancelled twice, and rescheduled for a third time when she decided to do all the planning and travel arrangements herself. But once again, a few days before the planned trip and meeting, she was told it was cancelled. “I was not happy,” says Makgatho, and she says she then went to Brian Molefe to escalate the issue.
After Molefe intervened, the trip finally took place on the third attempt – Molefe told Makgatho she could accompany Anoj Singh on the trip.
Makgatho says they struggled to reach a financing agreement with China North Rail and China South Rail, as their prices were too high.
Makgatho now discusses Transnet’s engagements with China.
Makgatho: “Their commitment fees were very high, their upfront fees were very high, but I was very patient at that particular point in time…”
Makgatho is still testifying about the locomotives tender, going into detail about the circumstances surrounding it.
Proceedings are under way. Advocate Refiloe Molefe is once again leading the evidence of Mathane Makgatho.