Statement by the Public Protector, Adv. Busisiwe Mkhwebane, during a media briefing held in Pretoria on Friday, July 19, 2019.

Programme Director, Mr. Oupa Segalwe;

Deputy Public Protector, Adv. Kevin Malunga;

Chief Executive Officer, Mr. Vussy Mahlangu;

Chief Operations Officer, Ms. Basani Baloyi;

Executive Managers present;

Chief of Staff, Mr. Sibusiso Nyembe;

Members of the media;

Ladies and gentlemen;

 

Good morning!

1. Today I reveal my findings and the appropriate remedial action that I have taken following an investigation into allegations of a violation of the Executive Ethics Code by President of the Republic of South Africa, His Excellency, Mr Cyril Ramaphosa. This is in relation to his allegedly improper relationship with African Global Operations, a company previously known as Bosasa.

 

2. At the outset, I would like to thank the President for the dignified manner with which he conducted himself during the course of this investigation. The respect he accorded my office from the moment I informed him of the complaints against him up to this point has been nothing short of exemplary. It is my belief that the President conducted himself in that manner because he understood that he is not above scrutiny.

 

3. Leading by example, the President, during the course of the investigation, fully embraced the principles establishing and governing the Public Protector. Included among those principle is that this office is independent, and subject only to the Constitution and the law, and must be impartial and exercise its powers and perform its functions without fear, favour or prejudice. The office must also be assisted and protected to ensure its independence, impartiality, dignity and effectiveness. Further, no person or organ of state may interfere with the office’s functioning. 

 

4. I trust that other members of the executive will take a leaf out of the President’s book and allow accountability institutions such as my office to hold them to account whenever the need arises and do so without any undue protest, which may lead to the erosion of public trust in this office. 

 

5. It is only when people who hold positions as enormous as that of the President and other members of the Executive accord accountability institutions the due respect that ordinary people are likely to follow suit and submit themselves to accountability processes whenever called upon to do so. 

 

THE COMPLAINTS

 

6. On 23 November 2018, I received a complaint from Mr. Mmusi Maimane, MP, the leader of the official opposition in the National Assembly, the Democratic Alliance (DA), alleging a violation of the Executive Code of Ethics by President Cyril Ramaphosa.  

 

7. In his complaint, Mr. Maimane alleged that on 18 October 2017, an amount of five hundred thousand rand (R500 000, 00) was paid into a bank account referred to as “EFG2”, which is said to be a trust foundation account of the son of President Ramaphosa’s son, Mr. Andile Ramaphosa.

 

8. He stated that the money in question was paid from a personal account of Gavin Watson, the Chief Executive Officer of AGO into the account of Miotto Trading, a company closely associated with Bosasa before being paid to the “EFG2” bank account.

 

9. Mr. Maimane also alleged that on 06 November 2018, during a question session in Parliament, President Ramaphosa violated the Executive Ethics Code by deliberately misleading the National Assembly in his reply to a question he (Mr Maimane) had posed.

 

10. The question concerned related to the proof of payment he was in possession of, indicating the transfer of funds into a trust account called EFGR on 18 October 2017, allegedly for Mr. Andile Ramaphosa. During that question session, Mr. Maimane further indicated that he was in possession of a sworn affidavit from a certain Mr. Peet Venter, stating that he had been asked by the CEO of Bosasa (AGO) to make the transfer for Mr. Andile Ramaphosa. He asked the President to take the nation into his confidence regarding the transaction concerned.

 

11. According to Mr. Maimane, the President stated, in response to the question,  that he was aware of the transaction and that he had asked his son, whom he said runs a financial consultancy business, about it. The President, according to Mr. Maimane, also indicated that among the companies his son consulted for, was Bosasa (AGO). He stated that he had asked his son about the funds in question and his son had told him the funds were payment for a services rendered and went as far as showing the President a copy of a contract signed with Bosasa (AGO).  The contract dealt with issues of integrity, issues of anticorruption and so forth.

 

12. Mr. Maimane stated that the President indicated added further amid interjections and applause that his son ran an honest business, going as far as to assure him that in the event in turned out that his son was involved in illegal activities or corruption, the President would be the first person to report the son to the authorities.

 

13. In a detailed letter, with annexed extracts from Hansard, the official record of debates in Parliament, Mr. Maimane further alleged that subsequent to the alleged, on 16 November 2018, President Ramaphosa sent a letter to the Speaker of the National Assembly, purporting to “correct” the answer he had given in the National Assembly ten days earlier. According to Mr. Maimane, in this letter, the President revealed that the payment in question was actually a donation toward his campaign to be elected President of governing party in December 2017 (CR17 campaign).

 

14. In addition, Mr. Maimane stated that it was his concern that an improper relationship possibly existed between President Ramaphosa and his family on the one side, and the company, AGO, on the other. According to him, the nature of the payment, passing through several intermediaries, did not accord with a straightforward donation and raised the suspicion of money laundering. The alleged donor was, in Mr. Maimane’s words, further widely reported to have received billions of Rands in state tenders, often in irregular fashion.

 

15. Not long after receiving Mr. Maimane’s complaint, on 26 January 2019, my office received a similar complaint from Mr. Floyd Shivambu, MP, the Deputy President and Chief Whip of the Economic Freedom Fighters. He also alleged that the President had violated the Executive Code of Ethics. Mr. Shivambu charged that, during President Ramaphosa’s appearance in the National Assembly on 06 November 2018, he said his son’s company had a contract with AGO for the provision of consultancy services, which deals with issues of integrity, anti-corruption and that there was nothing untoward.

 

16. Mr. Shivambu requested my office to investigate whether the President’s statement that he had seen the contract between his son’s company and African Global Operations was true, and if the contract did exist. In his letter, Mr. Shivambu, stated that the President had misled Parliament.

 

17. Mr. Shivambu stated that the President told the National Assembly that his son’s company had a contract with AGO for the provision of consultancy services. According to Mr. Shivambu, President Ramaphosa went on to explicitly state that he saw the contract that his son had signed with African Global Operations and the contract also “deals with issues of integrity, anti-corruption and there was nothing untoward”.

 

18. The complaint from the anonymous whistleblower, an ordinary member of the public, also contained an allegation that the President had violated the Executive Code of Ethics and like the first two, was lodged in terms of the Executive Members Ethics Act. However, members of the public are not entitled to lodge complaints in terms of that law. Only members of the Executive, Members of Parliament or Provincial Legislatures can lodge complaints under that piece of legislation. But at any rate, the complaint in question was similar to those of Mr. Maimane and Mr. Shivambu. I therefore decided to consolidate these complaints into one investigation for administrative purposes.

 

19. In a nutshell, the complainants allege that the President breached the following provisions of the Constitution and the Executive Ethics Code:

 

1. Section 96(1) and (2) of the Constitution, which states that: “Members of the Cabinet must act in accordance with a code of ethics prescribed by national legislation and may not act in any way that is inconsistent with their office, or expose themselves to any situation involving the risk of a conflict between their official responsibilities and private interests”.

 

2. Paragraph 2.1.(a)-(d) of the Executive Ethics Code, which states that: “Members must fulfil all the obligations imposed upon them by the Constitution and law; act in good faith and in the best interest of good governance; and act in all respects in a manner that is consistent with the integrity of their office”.

 

3. Paragraph 2.3 of the Executive Ethics Code, which states that: “Members of the Executive may not wilfully mislead the legislature to which they are accountable…(c) act in a way that is inconsistent with their position; (d) use their position or any information entrusted to them, to enrich themselves or improperly benefit any other person...”

 

4. Section 3(1) of the Executive Members’ Ethics Act, which provides that: The Public Protector must investigate any alleged breach of the code of ethics on receipt of a complaint contemplated in section 4.”

 

20. It was the complainants’ contention that President Ramaphosa “may have breached the Executive Ethics Code by (i) exposing himself to any situation involving the risk of a conflict between their official responsibilities and their private interests; (ii) acted in a way that is inconsistent with his position and (iii) used his position or any information entrusted to him, to enrich himself or improperly benefit any other person”.

 

ISSUES CONSIDERED AND INVESTIGATED

 

21. Following a thorough analysis of the complaints and having taken into account the fact that the President was a member of the National Assembly at the time of the alleged events, I decided to narrow down the investigation to the following three issues:

 

1. Whether on 06 November 2018, during a question session in Parliament, President Ramaphosa deliberately misled the National Assembly and thereby acted in violation of the provisions of the Executive Ethics Code and the Code of Ethical Conduct and Disclosure of Members’ Interests for the National Assembly and Permanent Council Members;

 

2. Whether President Ramaphosa improperly and in violation of the provisions of the Executive Ethics Code and Disclosure of Members’ Interests for the National Assembly and Permanent Council Members exposed himself to any situation involving the risk of a conflict between his official duties and his private interest or used his position to enrich himself and his son through businesses owned by AGO; and

 

3. Whether there is an improper relationship between President Ramaphosa and his family on the one side, and the company African Global Operations on the other due to the nature of the R500 000,00 payment passing through several intermediaries, instead of a straightforward donation to the CR17 campaign thus raising the suspicion of money laundering.

 

APPROACH TO THE INVESTIGATION

 

22. Our approach to investigations is quite standard. We look at what happened, which is a blow-by-blow account of who did what, when and so forth. We then look at what should have happened, which covers the standards that ought to have been upheld by the person(s) alleged to have engaged in wrongdoing. These standards would include policies, laws and the Constitution, among other prescripts.

 

23. Once we have established what happened on the one side and what should have happened on the other, we bring the two versions together, with a view to reconciling them. Ideally, the reconciliation should be seamless. A less than smooth reconciliation would suggest that some wrongdoing took place. At that point, we would proceed to make findings and come up with what in the circumstances would be an appropriate remedial action. This approach was applied in the case at hand.

 

KEY SOURCES OF INFORMATION

24. The investigation was conducted by way correspondence, interviews, an analysis of the relevant documentation as well as the consideration and application of relevant laws, related prescripts and case law.

 

25. In this regard, among the nearly 30 key documents I relied upon were letters from the President, Mr. Maimane and Mr. Shivambu; affidavits from Mr. Nainesh Desai of First National Bank; Mr. Petrus Venter of Miotto Trading; Mr. Andile Ramaphosa; Mr. Bejani Chauke and Mr. James Motlatsi of the CR17 Campaign; Ms. Donne Nicol, the President’s advisor; a supplementary statement from the President, letters from Rushmere Noach Inc., and from the Director of the Financial Intelligence Centre, Adv. Xolile Khanyile.

 

26. I also relied on an Advisory Mandate between Blue Crane Capital (Pty) Ltd and AGO; an Anti-Bribery and Corruption Policy between Blue Crane Capital (Pty) Ltd and AGO; a legal opinion from Seanego Incorporated; letters from EFG attorneys; and HNM attorneys; as well as the President’s response to a notice served on him in terms of section 7(9) of the Public Protector Act 23 of 1994.

 

27. I further relied on evidence obtained during interviews with Mr. Petrus Venter, Mr. Gavin Watson, Mr. Bejani Chauke, Mr. James Motlatsi, Ms. Donne Nicol, Mr. Barry Farber, Ms. Ronel Grobler, all of whom gave their evidence under oath or affirmation. Lastly, I relied on information obtained during two meetings I had with the President.

 

LEGISLATION AND OTHER PRESCRIPTS

 

28. Key laws and policies taken into account to determine if there was any impropriety in the conduct of the President as alleged included the Constitution of the Republic of South Africa, 1996; the Public Protector Act, 23 of 1994; the Executive Members’ Ethics Act 1998; the Financial Intelligence Services Act, 2000; the Prevention and Combating of Corrupt Activities Act, 2004; and the Executive Ethics Code.

 

29. Further, the case law I considered included Public Protector v Mail and Guardian Ltd (422/10) (2011) ZASCA 108 (1 June 2011), Economic Freedom Fighters v Speaker of the National Assembly and Others, Democratic Alliance v Speaker of the National Assembly and Others, President of the Republic of South Africa v Office of the Public Protector and Others (91139/2016) [2017] ZAGPPHC 747; 2018 (2) SA 100 (GP) ; [2018] 1 All SA 800 (GP); 2018 (5) BCLR 609 (GP) (13 December 2017), and Minister of Home Affairs v The Public Protector of South Africa (308/217) [2018] ZASCA 15 (15 March 2018).

 

THE INVESTIGATION

 

30. At the commencement of the investigation, on 14 December 2018, I notified the President and the then Speaker of the National Assembly, Ms. Baleka Mbete, of the complaints I received. I informed them that I intended to conduct a formal investigation in relation to the complaints. I also invited the President to comment on the allegations leveled against him.

 

31. I now deal the question around whether on 06 November 2018 during question session in Parliament, President Ramaphosa deliberately misled the National Assembly and thereby acted in violation of the provisions of the Executive Ethics Code and Code of Ethical Conduct and Disclosure of Members’ Interests for Assembly and Permanent Council Members.

 

32. It is not in dispute that during the question and answer session in Parliament on 06 November 2018, President Ramaphosa responded to a question posed by Mr Maimane regarding the alleged improper payment of R500 000,00 made by AGO to his son, Mr. Andile Ramaphosa.

 

33. I enquired from President Ramaphosa why he felt compelled to respond to Mr. Maimane’s question as it was a follow-up, which was unrelated to the earlier question on VBS Mutual Bank and was not in line with the rules of the National Assembly.

 

34. He indicated that he had felt the need to respond to what he believed was an attack on his integrity by Mr. Maimane, which happened in the heat of the moment, and he had to answer on his feet.

 

35. On 01 February 2019, I received President Ramaphosa’s response and in his letter. He asserted that both the allegation that he violated the Executive Ethics Code by deliberately misleading the National Assembly in his reply to a question by Mr Maimane; and that the available set of facts revealed that there was possibly an improper relationship existing between him and his family on the one side, and the company, AGO on the other side, were untrue since they relied to a large extent on what he knew and when he knew it. He indicated that he had structured his statement in a manner that established the facts and the chronology of events as they relate to the information available to him.

 

36. In as far as the allegation by Mr. Maimane of “improper relationship existing between the President and his family on the one side, and the company, African Global Operations on the other side”, the President stated that on or about 05 September 2018, he was informed by one his advisers, Mr Bejani Chauke about a rumour that his son, Mr Andile Ramaphosa had received a payment of R500 000, 00 from AGO.

 

37. He indicated that on enquiring from his son, he was informed that in December 2017, the son’s company, Blue Crane Capital (Pty) Ltd, signed an Advisory Mandate with AGO for possible business entry in some East African countries; and that, in January 2018, his company signed an Anti-Bribery and Corruption Policy with AGO.

 

38. The President indicated that the signing of an Anti-Bribery and Corruption Policy was a practice that his son had instituted with all his clients as a precautionary measure following the President’s election as President of the African National Congress (ANC) in December 2017.

 

39. President Ramaphosa stated that his son showed him copies of both the Advisory Mandate and the Anti-Bribery and Corruption Policy. He further stated that it was on this occasion, in September 2018, that he first became aware that his son’s company had a business relationship with AGO.

 

40. According to President Ramaphosa, from the way it was explained to him, and based on the Advisory Mandate and the Anti-Bribery and Corruption Policy, he had no reason to believe that there was anything untoward about the relationship.

 

41. Regarding his parliamentary reply on 06 November 2018, the President indicated that, on 06 November 2018, he appeared in the National Assembly to respond to Questions for Oral Reply.

 

42. He explained that, in terms of the rules of the National Assembly, he is expected to appear in the National Assembly once a quarter to reply to questions submitted by MPs. The six (6) questions are received in advance and replies are prepared. Once the President has responded to a question, the MP that asked the question has an opportunity for a follow-up question.

 

43. He indicated that on the occasion concerned, the first question was from Mr Maimane about VBS Mutual Bank. In his follow-up question, Mr Maimane referred to a payment that had allegedly been made by AGO to his son, Mr. Andile Ramaphosa.

 

44. The President said that he assumed that the payment to which Mr Maimane was referring related to the Advisory Mandate that had been signed between his son’s company and AGO and that his was based on what he had been told of his son’s business relationship with AGO just two months earlier.

 

45. He stated that his main reply to Mr Maimane’s supplementary question was based on the information that he had at the time, and that it was against this background that he reasonably made the assumption that the alleged payment was related to the Advisory Mandate that his son’s company had signed with AGO. 

 

46. The President also stated that upon returning to his office in Tuynhuis following the questions session, he was informed by one of his advisers, Ms Donne Nicol, that the account that Mr Maimane had referred to, EFG2, was an attorney’s trust account that had been used by the CR17 campaign to raise funds for the campaign to advocate for his election as President of the African National Congress (ANC) at the organisation’s 54th National Conference in December 2017.

 

47. According to the President, a deliberate decision had been taken by himself and by those leading the campaign that he would not be involved in fundraising even as he would address meetings and have a few dinners with potential funders. These meetings and dinners with potential funders were used as occasions where he would have outlined his vision for the ANC and the country.

 

48. They had also decided that he would not be provided with the identity of donors or the amounts pledged, as he did not feel under obligation to them in any shape or form at any time in the future. President Ramaphosa further stated that he was therefore not aware at the time that he appeared in the National Assembly on 06 November 2018 that Mr Gavin Watson had made a donation to the CR17 campaign.

 

49. He stated that his immediate response was that this information should be disclosed and that his reply in the National Assembly should be corrected. According to the President, at a meeting on 08 November 2018, his advisers confirmed that a payment of R500 000,00 had been made on behalf of Mr Gavin Watson into the CRI7  attorney’s trust account on 18 October 2017, and that this donation was distinct from, and unrelated to, the business relationship between his son’s company and AGO.

 

50. Upon hearing all this information, the President stated that he then decided to write to the Speaker of the National Assembly to inform her that he had inadvertently provided incorrect information to the House on 06 November 2018. He directed his staff to make public his explanation to the Speaker of the National Assembly in a media release. He further requested that the former managers of the CR17 campaign, Messrs Bejani Chauke and James Motlatsi, also prepare a statement in which they clarify the nature of, and circumstances in which, the payment was made.

 

51. The President also indicated that he has since been informed by the CR17 campaign managers that after an unsuccessful attempts to meet Mr Gavin Watson in order to arrange for the return of the donation, an amount of R500 000, 00 has been transferred into an attorney’s trust account until such time as these matters surrounding AGO are clarified following various concerning disclosures before the Zondo Commission of Inquiry into State Capture. Thereafter, a decision will be made as to whether these monies should be returned to the account where they came from, passed onto appropriate government authorities, or donated to charity.

 

52. President Ramaphosa asserted that he did not deliberately mislead Parliament and that at the time of his reply to Mr Maimane in the National Assembly on 06 November 2018, he was not aware that a payment had been made on behalf of Mr Gavin Watson to the CR17 campaign. He assumed that the payment to which Mr Maimane referred related to the agreement between his son’s company and AGO.

 

53. He further asserted that once he became aware that the payment was in fact a donation by Mr Watson to the CR17 campaign, he informed the Speaker of the National Assembly by means of a letter dated 14 November 2018 and made a public statement on the matter through the former campaign managers on 16 November 2018.

 

54. The President asserted that there was no improper relationship between him and his family on the one side, and AGO on the other. He was neither aware of, nor involved in, the conclusion of an Advisory Mandate between Blue Crane (Pty) Ltd and African Global Operations.

 

55. Concluding his submission to my office, the President reiterated the message that he conveyed in the National Assembly on 06 November 2018 that he has discouraged his children from conducting business with government or with any state-owned entity. In this regard, he has told them that if he became aware of any illegality or corruption in their business activities, he would be the first to report them to the authorities.

 

56. In the seminal case of Public Protector vs Mail and Guardian Ltd (422/10) (2011) ZASCA 108 (1 June 2011), the Supreme Court of Appeal (SCA) held that the Public Protector is not a passive adjudicator between the citizens and the state, relying only upon evidence which is placed before her by the parties. The court held further that the Public Protector should not be bound or be limited to the issues raised for consideration and determination by the parties but should, investigate further and discover the truth and also inspire confidence that the truth has been discovered.

 

57. The court further made it clear that the mandate of the Public Protector is an investigatory one, requiring pro-action in appropriate circumstances. Although the Public Protector may act upon complaints that are made, he or she may also take the initiative to commence an enquiry, and on no more than ‘information that has come to his or her knowledge’ of maladministration, malfeasance or impropriety in public life. The court emphasized that the Public Protector has a pro-active function. He or she is expected not to sit back and wait for proof where there are allegations of malfeasance but is enjoined to actively discover the truth.

 

58. Although the complaint by Mr Maimane had been lodged in terms of the Executive Members Ethics Act, Mr Maimane had in the same complaint, also requested that the suspicion of money laundering should be probed due to the manner in which the transaction relating to the payment to the CR17 campaign went through several intermediaries before reaching its intended beneficiary.

 

59. In that regard my office discovered during a series of investigative interviews conducted with several key role players between January 2019 and March 2019 a lot of insight into what exactly happened during the CR17 campaign. As an investigatory and oversight body I could not turn a blind eye to this discovery especially as this lent credence to Mr Maimane’s second issue relating to the suspicion of money laundering.

 

60. Furthermore, in order to deal effectively with the issue relating to the suspicion of money laundering, I could not just investigate selectively the R500 000, 00 donation made by Bosasa to the CR17 campaign in order to establish the veracity or otherwise of the allegation. I have therefore deliberately decided to cite the above case law and further laid this short background in order to address or dispel any misguided notion or contention that I have unduly extended the scope of this investigation without just cause.

 

61. Section 96(1) and (2) of the Constitution states that: “Members of the Cabinet must act in accordance with a code of ethics prescribed by national legislation and may not act in any way that is inconsistent with their office, or expose themselves to any situation involving the risk of a conflict between their official responsibilities and private interests”.

 

62. Paragraph 2.1.(a)-(d) of the Executive Ethics Code, states that: “Members must fulfil all the obligations imposed upon them by the Constitution and law; act in good faith and in the best interest of good governance; and act in all respects in a manner that is consistent with the integrity of their office”.

 

63. Paragraph 2.3 of the Executive Ethics Code further states that: “Members of the Executive may not wilfully mislead the legislature to which they are accountable…(c) act in a way that is inconsistent with their position; (d) use their position or any information entrusted to them, to enrich themselves or improperly benefit any other person...”

 

64. According to Rule 140 of Rules of the National Assembly, 2016 questions to the President must be submitted to Speaker at least 16 calendar days before the question day on which they are to be answered, for the Speaker’s approval and compliance with the rules by the Rules Committee. The number of questions is limited to six (6) questions per day.

 

65. Rule 141 (1) provides that a member may request the Speaker in writing to allow an urgent question to be put to the President or the Deputy President on the next applicable question day. Furthermore, a member who wants to put an urgent question in terms of sub rule 1 must deliver a signed copy of the question to the Speaker before 12:00 on the day preceding the question day on which the question is to be answered, clearly indicating that it is an urgent question.

 

66. According to rule 142(4) of the Rules, in respect of each question, four supplementary questions may be asked, the member in whose name a question stands or who takes charge of a question in terms of rule 137(10) being given first opportunity to ask a supplementary question.

 

67. Rule 142(6) provides that a supplementary question must arise directly from the original question and the reply given thereto and may not constitute a new question.

 

68. President Ramaphosa’s heat of the moment response is of concern because I believe that Parliamentary questions are an important means used by Members of Parliament to ensure that Government is accountable to the Parliament for its policies and actions and, through the Parliament to the people.

 

69. Therefore President Ramaphosa’s provocation by the question from the leader of the opposition cannot justify giving poorly prepared answers and creating a risk of misleading Parliament as he did in this case. 

 

70. The South African law is silent on whether Cabinet Members or Presidents may amend or make corrections to statements made in their oral reply to Parliament. This is a grey area which calls for Parliament’s attention.

 

71. It therefore goes without saying that, although President Ramaphosa may have been justified to correct the earlier statement he had made on erroneous or incomplete information at his disposal, he did mislead Parliament.

 

72. In the absence of such explicit rules dealing with such corrections or amendments, regard must be had to section 2.3 of the Executive Ethics Code which states that: “Members may not deliberately or inadvertently mislead the President, or the Premier, or as in this case, the Legislature”.

 

73. In the Constitutional Court case between the Economic Freedom Fighters v Speaker of the National Assembly and Others; Democratic Alliance v Speaker of the National Assembly and Others, the question regarding the President’s obligations was exhaustively dealt with as follows by Chief Justice Mogoeng.

 

74. He said “The President is the Head of State and Head of the national Executive. His is indeed the highest calling to the highest office in the land. He is the first citizen of this country and occupies a position indispensable for the effective governance of our democratic country. Only upon him has the constitutional obligation to uphold, defend and respect the Constitution. He is the constitutional being by design, a national pathfinder, the quintessential commander-in chief of State affairs and the personification of this nation’s constitutional project”.

 

75. It is worth noting that the President, in responding to Mr Maimane’s question on 06 November 2018, did so to a question that did not meet any of the above criteria of the Rules of the National Assembly, as the original question asked by Mr. Maimane related to the VBS Mutual Bank and not AGO.

 

76. According to the evidence provided to my office, Mr. Bejani Chauke had in September 2018, upon hearing rumours about the alleged relationship between Mr Andile Ramaphosa and AGO, alerted President Ramaphosa to the rumour. This was almost two months before Mr. Maimane could pose the question relating to AGO to the President in Parliament.

 

77. I therefore submit that nothing stopped the President from objecting to the question, and even to make a request to the Speaker of the National Assembly to be allowed in terms of the Rules, to go and prepare a well-researched response.

 

78. As indicated above, the statement made by President Ramaphosa on 06 November 2018 in his reply to Mr Maimane’s question albeit defective in terms of the Rules of the National Assembly, was misleading, as he also conceded in his correspondence to my office on 01 February 2019, and even in his subsequent letter to the Speaker of the National Assembly on 14 November 2018 where he sought to correct the incorrect information he had provided in the National Assembly.

 

79. Consequently, President Ramaphosa’s reply was in breach of the provisions of paragraph 2.3(a) of the Executive Ethics Code, the standard of which includes deliberate and inadvertent misleading of the Legislature. He inadvertently and/or deliberately misled Parliament, in that he should have allowed himself sufficient time to consider the question and make a well-informed response.

 

80. President Ramaphosa as the head of state and the epitome of the Constitution, should have acted with restraint and not allowed Mr. Maimane’s question to affect his demeanour as he had stated in his response, that he had felt attacked and had to defend himself and his family. His conduct was inconsistent with his office as a member of Cabinet and therefore in violation of section 96(1) of the Constitution, as referred to above.

 

81. I now turn to whether President Ramaphosa improperly and in violation of the provisions of the Executive Ethics Code and Disclosure of Members’ Interests for the National Assembly and Permanent Council Members exposed himself to any situation involving the risk of a conflict between his official duties and his private interest or used his position to enrich himself and his son through businesses owned by African Global Operations.

 

82. It is common cause that a payment of R500 000,00 was made by AGO into an EFG2 attorneys trust account towards the CR17 campaign in October 2017 during the President Ramaphosa’s election campaign towards becoming ANC President in December 2017.

 

83. It is also not in dispute that the President’s son Mr Andile Ramaphosa had business contracts with AGO for which he was paid large sums of money for the services he rendered to the company.

 

84. The issue for my determination is whether or not President Ramaphosa as the then Deputy President and member of Parliament was duty bound to declare the financial benefit accruing to him during the campaign, and whether his failure to disclose such financial benefit was in violation of the Executive Ethics Code.

 

85. On 11 March 2019, President Ramaphosa submitted a supplementary statement to my office, which ostensibly set out to clarify the issue of conflict of interest and the obligation of members of the National Assembly to disclose financial interests received in their private capacities as members of political parties as opposed to such gifts and donations received whilst performing their official responsibilities.

 

86. The President stated that during a discussion between me and him regarding the R500 000 donation that was paid by AGO into a law firm’s ABSA trust account towards his campaign for the presidency of the ANC in 2017 I seemed to suggest that “the donation amounted to a ‘benefit’ and that it ought to have been disclosed”.

 

87. He indicated that he became a Member of Parliament in May 2014 and thereafter was appointed Deputy President of the country. In that capacity he said he disclosed interests as required by the Executive Ethics Code every year. He said further that he continued to do so since his election as President in February 2018.

 

88. In so doing and based on the provisions of the Code, he said he discloses share and financial interests in companies and other corporate entities, sponsorships, gifts and other hospitality, benefits of a material nature, foreign travel, land and immovable property (inside or outside South Africa) and pensions.

 

89. He indicated further that he was aware of his duty to disclose such information in relation to his spouse and his dependent children, to the extent that he was aware of them. He said that his son Andile Ramaphosa was not dependent upon him for financial support. He said he therefore was not obliged to disclose any of his financial interests in terms of the Code.

 

90. The President indicated that since becoming a Member of Parliament and a member of the executive, he had taken care to be guided by Section 2(1) of the Executive Members Ethics Act, 82 of 1998 which requires the President to publish a code of ethics prescribing standards and rules which “members” must comply with when performing their official duties.

 

91. He referred to the introduction of the Code of Ethics, where the President states that: “In terms of section 2(1) of the Executive Members’ Ethics Act, 1998 (Act No 82 of 1998), I hereby after consultation with Parliament, publish the Executive Ethics Code with which Members of the Cabinet, Deputy Ministers and Members of Provincial Executive Councils must comply with in performing their official responsibilities.”

 

92. He submitted that this provision indicated that the target of the Executive Ethics Act was to regulate “members” in the performance of their official responsibilities, and not internal political party election donations.

 

93. The President further quoted Section 2(2) (c) (ii) of the Executive Ethics Act, which further states that the Code of Ethics published by the President must require members to disclose: “any financial interests acquired after their assumption of office, including any gifts, sponsored foreign travel, pensions, hospitality and other benefits of a material nature received by them or by such persons having a family or other relationship with them as may be determined in the code of ethics.”

 

94. He further indicated that, in accordance with section 2(2)(c)(ii) of the Executive Ethics Act, paragraph 5.1 of the Executive Ethics Code, in relation to the disclosure of financial interests, states that: “5.1 Every member must disclose to the Secretary particulars of all the financial interests as set out in paragraph 6…”

 

95. The President further referred to Paragraph 6 of the Code of Ethics, which lists a number of financial interests that are subject to disclosure and states the following in relation to the disclosure of benefits:

 

1. “6 Financial Interests to be disclosed:
2. Members must disclose the following interests and details:
3. 6.4 Benefits:
4. “The nature and source of any other benefit of a material nature and the value of that benefit.”
5. Further, the President noted that paragraph 4.1 of the Code of Ethics prohibits the solicitation or acceptance of a gift or benefit which:
6. “(a) is in return for any benefit received from the member in the member’s official capacity;
7. constitutes improper influence on the member, or
8. constitutes an attempt to influence the member in the performance of the member’s duties”.

 

96. The President submitted that the donation was not in return for any benefit received by him in his official capacity, nor was it in order to influence him in the performance of his duties. He said the donation was instead received to support an internal political party election.

 

97. In the President’s view, there is a distinction between donations made towards a campaign fund for a political party’s elective conference and gifts and benefits received by “members” in their official capacity or in an attempt to influence the “member” in the performance of their duties – the latter two instances would reasonably be subject to disclosure and/or prohibition.

 

98. He contended that it could never have been the intention of the legislature to regulate donor funding for internal political party elections. According to him, it was clearly the intention of the legislature to regulate the provision of gifts and benefits to members “in return for a benefit received by the member in their official capacity”, or “in an attempt to influence the member in the performance of the member’s duties”.

 

99. He indicated that the donation related to an internal political party election, and had nothing to do with “members” in their official capacity or in the performance of their duties.

 

100. The President indicated that currently in law there was no obligation in South Africa for “members” to disclose their sources of private funding in an internal political party election and it would be unreasonable and irrational to prohibit or to require the disclosure of such donations. Simply put, it cannot be that every person, who may also be a “member”, contesting an internal political party election would be expected to disclose their donors, argued the President.

 

101. He further indicated that he was not aware of any person in any political party, who was also a “member” and who received a donation towards their campaign in an internal party election, being obliged to make public or to disclose the list of donors that contributed to their campaign.

 

102. He referred to section 2(2) (c) (ii) of the Executive Ethics Act, which states that the disclosure of a benefit is required, firstly if it is a material benefit, and secondly, if it is received by the “member”. Although the donation may be regarded as material in nature, the President said it was not received by him, instead, it was received by the CR17 campaign in strict confidence.

 

103. President Ramaphosa also indicated that he had no knowledge of the donation and therefore could not reasonably be expected to have disclosed it when it was made, even if there was an obligation to do so, which there was not.

 

104. In the light of this, he submitted that paragraph 4.1 of the Code of Ethics only prohibits the solicitation or acceptance of a gift or benefit which is in return for any benefit received by a “member” in their official capacity, or constitutes improper influence on the “member”, or constitutes an attempt to influence the “member”. He added that in such circumstances, it was appropriate to either require the disclosure of an offer of such benefit or to prohibit its solicitation or acceptance. However, he indicated that the donation was neither offered, solicited, nor accepted by him for any of the aforementioned reasons.

 

105. As such, he stated that he was neither required to disclose the donation, nor was he prohibited from receiving it in terms of paragraph 4.1 of the Code of Ethics, as it was not received by him in my capacity as a “member” and because the Code of Ethics does not apply to internal political party campaigns.

 

106. The President added that, although the donation may be regarded as a ‘material benefit’ in terms of paragraph 6.4 of the Code of Ethics, in which case he would have been required to disclose it; because he was unaware of the identity of the donors to the CR17 campaign, since donations were paid towards the CR17 campaign on a confidential basis, it would be unreasonable to expect the donation to have been disclosed by him when it was made. He said it would be equally unreasonable to expect every person, who may also be a “member” contesting an internal political party election to disclose such donors.

 

107. Based on this argument, the President stated that he did not believe that he had failed in his duties to disclose interests as required in the Executive Ethics Code. 

 

108. Section 96(1) and (2) of the Constitution states that: “Members of the Cabinet must act in accordance with a code of ethics prescribed by national legislation and may not act in any way that is inconsistent with their office, or expose themselves to any situation involving the risk of a conflict between their official responsibilities and private interests”.

 

109. Paragraph 2.1.(a)-(d) of the Executive Ethics Code states that: “Members must fulfil all the obligations imposed upon them by the Constitution and law; act in good faith and in the best interest of good governance; and act in all respects in a manner that is consistent with the integrity of their office”.

 

110. Paragraph 2.3 of the Executive Ethics Code further states that: “Members of the Executive may not wilfully mislead the legislature to which they are accountable…(c) act in a way that is inconsistent with their position; (d) use their position or any information entrusted to them, to enrich themselves or improperly benefit any other person...(d) expose themselves to a situation involving the risk of a conflict between their official responsibilities and their private interests…act in a way that may compromise the credibility or integrity of their office or government”.

 

111. The Code of Ethical Conduct and Disclosure of Members’ Interest for Assembly and Permanent Council Members, which applies to all Members who are Members of the Executive, and which must be read with the Powers, Privileges and Immunities of Parliaments and Provincial Legislatures Act 4 OF 2004, Prevention, Combating of Corrupt Activities Act 12 of 2004 and the Financial Management Act of Parliament Act 10 0f 2009, establish offences on discipline and contempt of Parliament.

 

112. Paragraph 9 of the Code entitled “Disclosure of registerable interests” prescribes inter alia that Members of Parliament must disclose to the Registrar of the Committee particulars of all their registerable interests. The term “registerable interests” is defined in the Code as all financial interests listed in paragraph 9.3, including the financial interests of the member’s spouse, dependent child and permanent companion.

 

113. Registerable interests include the following: shares and other financial interests in companies and other corporate entities; remunerated employment outside Parliament; directorships and partnerships; consultancies;  sponsorships; gifts and other hospitality; any other benefits of a material nature, foreign travel, ownership in land and property including immovable property (inside or outside South Africa); pensions; public contracts awarded; trusts and encumbrances.

 

114. Paragraph 9.18 of the Code stipulates that: Where any doubt exists as to whether any financial interests must be disclosed, the member concerned must act in good faith”

 

1. In terms of paragraph 10.1 .1, a breach occurs if the Member:-

 

1. “contravenes or fails to comply with the requirements of the provisions for disclosing interests;
2. When disclosing registerable interests, wilfully or is grossly negligently, provides the Registrar with incorrect or misleading details; or
3. contravenes paragraphs 4.1, 5.1, 5.2, 6.1, 6.2, 6.3, 7.1, 8.1, 9.19.4 and 9.19.5 of this Code;” and

 

4. A former member breaches this Code of Conduct if the former Member contravenes paragraph 8.2 of the Code of Conduct.

 

5. Paragraph 4.1 of the Code provides that Members must:
6. 4.1.1 abide by the principles, rules and obligations of this Code;
7. 4.1.2 by virtue of the oath or affirmation of allegiance taken by all elected Members, uphold the law;
8. 4.1.3 act on all occasions in accordance with the public trust placed in them;
9. 4.1.4 discharge their obligations, in terms of the Constitution, to Parliament and the public at large, by placing the public interest above their own interests;
10. 4.1.5 maintain public confidence and trust in the integrity of Parliament and thereby engender the respect and confidence that society needs to have in Parliament.
11. 4.1.6 in the performance of their duties and responsibilities, be committed to the eradication of all forms of discrimination.

 

115. In the Constitutional Court case between the Economic Freedom Fighters v Speaker of the National Assembly and Others; Democratic Alliance v Speaker of the National Assembly and Others, the question whether the President knowingly or unwittingly exposed himself to “a situation involving the risk of a conflict between his official responsibilities and private interests” was exhaustively dealt with.

 

116. In the matter that gave rise to that court case, the Nkandla investigation, the Public Protector’s finding on the violation of section 96 was based on the self-evident reality that the features identified and unrelated to the security of the President, checked against the list of what the South African Police Service security experts themselves determined to be security features were installed because the people involved knew they were dealing with the President.

 

117. When some government functionaries find themselves in that position, the inclination to want to please higher authority by doing more than is reasonably required or legally permissible or to accede to a gentle nudge by overzealous and ambitious senior officials to do “a little wrong” here and there, may be irresistible.

 

118. However, a person in the position of the President should be alive to this reality and guard against its occurrence. Failure to do this may constitute an infringement of this provision. To find oneself on the wrong side of section 96, all that needs to be proven is a risk. It does not even have to materialise.

 

119. In “State and Party: Blurred Lines”: Report No. 12 of 2015/2016, which I have used as a touchstone in this matter, the issue, inter alia, was about conflation of party political activities and the state events where sometimes members would be regarded or purporting to act in their personal capacities and therefore violating applicable provisions of the Executive Ethics Code due to the blurred lines between their responsibilities in circumstances where state and party’ roles tend to overlap.

 

120. Deriving from the above legal prescripts and case law, it can be safely argued that the campaign pledges towards the CR17 campaign were some form of sponsorship, and that they were direct financial sponsorship or assistance from non-party sources other than a family member or permanent companion, and were therefore benefits of a material nature. President Ramaphosa’s failure to disclose the said material benefits, including a donation from AGO constitutes a breach of the Code.

 

121. President Ramaphosa received “assistance from any source other than the member’s party which benefits the member in his or her personal and private capacity” because, as a presidential candidate for the ANC, he received campaign contributions which benefitted him in his personal capacity. Being the Deputy President of the country and a Member of Parliament at the time, President Ramaphosa was therefore duty bound to declare financial benefit accruing to him from the campaign activities.

 

122. It cannot also be argued that the financial benefit did not accrue to President Ramaphosa personally merely because it was deposited in a trust account for the CR17 campaign. I have evidence which indicates that some of the money collected through the CR17 campaign trust account was transferred into the Cyril Ramaphosa (CR) Foundation account.

 

123. I have also established that President Ramaphosa hosted the dinner functions which had been organised for the donors where he addressed them. Therefore, my view is that he actively participated in the campaign process.

 

124. Furthermore, I have evidence which confirms regular updates to President Ramaphosa on the operations of the CR17 campaign by the campaign managers, his directives to them about payments of the money into the CR Foundation as well as being asked by the campaign managers to speak to certain donors.

 

125. Consequently, political parties are under no express legal obligation to disclose the sources of their private funding, at elections or other times. However, on the contrary different considerations apply when it comes to individual political party members who may be Members of Parliament and Cabinet Ministers at the same time and who, in their private capacity, obtain sponsorships, solicit gifts in whatever disguised form or obtain any other benefit of a material nature to aid them in their competition for party leadership positions.  Therefore they cannot seek refuge behind the party political activity label as they should comply with the applicable ethical codes of conduct governing their conduct as Members of Parliament or the Executive.

 

126. Section 96 of the Constitution requires Cabinet Members to act in accordance with the Code and that they should refrain from acting in a way which is inconsistent with their office, or expose themselves to any situation involving the risk of a conflict between their official responsibilities and private interests. Based on the aforesaid, it is therefore my view, that even private activity or interests may cause Cabinet Members to violate the provisions of the Executive Members’ Ethics Act.

 

127. Further, a person in the position of the Deputy President (as the President was then), is required by the standards of ethical conduct set by the provisions of section 96 of the Constitution and the Executive Ethics Code to have been concerned about the obvious extravagant and expensive donation into a trust account that was used to raise funds for his benefit. In any reasonable person’s opinion, it is expected of the President to have interrogated the source of these donations.

 

128. Although I have been informed by the CR17 campaign managers that the deliberate concealment of the identity of the donors and the amounts donated by them from President Ramaphosa was to avoid creating a perception that his goodwill can be bought, the primary reason in my view, should have been to avoid any situation of capture of the President that might compromise his decision-making in the future.  

 

129. Instead, the President just tacitly accepted these donations, amongst which there was this solicited donation of R500 000 by Mr Gavin Watson, the owner of AGO, the company that had a contract with the Department of Correctional Services.   

 

130. No matter how one looks at the issue, a conclusion that direct sponsorship of one’s political campaign for party leadership, does qualify as declarable “sponsorship” is inescapable.

 

131. President Ramaphosa’s failure to disclose financial interest which accrued to him, as a result of the donations received towards the CR17 campaign constitutes a violation of paragraph 2 of the Executive Ethics Code, and accordingly amounts to conduct that is inconsistent with his office as member of Cabinet, as contemplated by section 96 of the Constitution.    

 

132. The last question that I wish to deal with is whether there is an improper relationship between President Ramaphosa and his family on the one side, and the company African Global Operations on the other side, due to the nature of the R500 000, 00 payment passing through several intermediaries, instead of a straightforward donation to the CR17 campaign, thus raising the suspicion of money laundering.

 

133. It is not in dispute that a payment of R500 000, 00 was made into an EFG2 trust foundation account by Mr Petrus Venter on 18 October 2017 on the instruction of Mr Gavin Watson.

 

134. The R500 000,00 was part of about R3 million which had been transferred from Mr Watson’s personal account by Ms Natasha Olivier the PA to Mr Watson, into the account of Miotto Trading which was the company of Mr Venter’s sister, Ms Margaret Longworth.

 

135. The issue for my determination is whether the payment of the said amount as a donation to the campaign was proper, and whether it does not amount to money laundering due to its having had to pass through several intermediaries before reaching its intended beneficiary.

 

136. In my meeting with the President on 29 January 2019, I had also raised the issue of the transfer of the R500 000, 00 payment into the EFG2 account because according to Mr Venter’s affidavit, this account belonged to the President’s son, Mr Andile Ramaphosa.

 

137. The President indicated that he was not involved in the fundraising process for the CR17 campaign and that there were campaign managers who were responsible for it. He stated that he only got to learn about the alleged payment from one of his advisers, Mr Bejani Chauke on or about 05 September 2018. Mr Chauke informed him about a rumour that his son, Mr Andile Ramaphosa had received a payment of R500 000, 00 from AGO.

 

138. According to President Ramaphosa, at a meeting on 08 November 2018, his advisers confirmed that a payment of R500 000,00 had been made on behalf of Mr Gavin Watson into the ‘CRI7 campaign’ attorney’s trust account on 18 October 2017, and that this donation was distinct from, and unrelated to, the business relationship between his son’s company and AGO.

 

139. President Ramaphosa informed me that all the information pertaining to the fundraising for the CR17 campaign can be sourced from the campaign managers whose names he provided me with.

 

140. Having had regard to the broader allegation relating to the suspicion of money laundering, I reviewed the bank records of the EFG2 trust account to establish how the funds which had been collected for the CR17 campaign were disbursed.

 

141. I also interviewed the directors of the Edelstein, Faber and Grobbler (EFG) attorneys who were responsible for the disbursement of funds in the CR17 campaign trust account, in order to establish what was their mandate and instructions regarding the EFG2 account.

 

142. My investigation team prepared subpoenas for interviews and submission of records by several key role players in the matter under investigation. These included President Ramaphosa’s adviser, Ms Donne Nicol, the CR17 campaign managers Messrs James Motlatsi and Bejani Chauke, Mr Andile Ramaphosa, the two banks involved in the transaction, FNB and ABSA, Mr Petrus Venter, two employees of AGO, Mr Gavin Watson and Ms Natasha Olivier and the Financial Intelligence Centre (FIC).

 

143. On 06 March 2019, I conducted an interview with Mr James Motlatsi, one of the two (2) CR17 campaign managers. As he had submitted a sworn statement prior to the interview, he took us through his prepared statement, giving us the background to the campaign and his specific role in it.

 

144. Mr Motlatsi indicated that he was one of the members of the fundraising committee, along with Mr Bejani Chauke and Ms Donne Nicol. According to him, they had decided early in 2017 to approach donors for the CR17 campaign with clear condition that the donors should not expect any favours in return for their contributions to the CR17 campaign. There was also a conscious decision by the committee members as well as an agreement with President Ramaphosa that he should not know the identities of the donors nor the amounts they had pledged.

 

145. As the members of committee, they decided to come up with names of possible donors whom they decided to approach in their individual capacities and not as directors or owners of businesses.

 

146. Mr Motlatsi stated that having known Mr Gavin Watson for more than 20 years, he is the one who identified Mr Watson, even approached and requested him to donate to the CR17 campaign. Mr Watson offered to donate R500 000, 00. Consequently, his business card was given to Ms Nicol by Mr Motlatsi and she then contacted him to provide him with the bank account details to effect the transfer of the money in October 2017.

 

147. Mr Motlatsi indicated that a decision had also been taken by them not to do anything in writing, therefore no records or documentation such as project plan, minutes of meetings were kept of the CR17 campaign.

 

148. According to him, Mr Bejani Chauke was the overall leader of the CR17 campaign whilst Ms Nicol was the facilitator of things for the campaign.

 

149. Mr Motlatsi stated that although he had been responsible for approaching Mr Watson for the donation to the campaign, a decision was taken to return the money to Mr Watson due to the subsequent media hype around Bosasa and the donation itself.

 

150. Mr Motlatsi stated that he knew President Ramaphosa from their days as members of the National Union of Mineworkers (NUM).

 

151. President Ramaphosa was also present at some of the dinners which had been organised by the CRI7 campaign managers for the donors, where he would address them and would naturally meet and greet the benefactors.

 

152. Mr Motlatsi also indicated that during their fundraising drive they had raised more than R200 million for the CR17 campaign.

 

153. I also conducted an interview with Mr Bejani Chauke who was one of the two (2) CR17 campaign managers, on the same date as Mr Motlatsi. He had his legal representative assisting him during the proceedings. As he had submitted a sworn statement prior to the interview, he took us through his prepared statement, giving us the background to the campaign, how it was started as an idea until its formalisation in 2017. This was then followed by questions for clarity by myself and the team.

 

154. Mr Chauke confirmed that he was the one who had alerted President Ramaphosa about the rumour that was doing rounds about the R500 000,00 payment by AGO to Mr Andile Ramaphosa. This was in September 2018, almost two (2) months before the matter was raised by Mr Maimane in Parliament.

 

155. Mr Chauke stated that he was part of the campaign committee in which he was playing an oversight role, but that there was also a fundraising committee which comprised other members, including Ms Donne Nicol and Mr James Motlatsi who was the leader of the committee.

 

156. He indicated that he played no role in the finances of the campaign except when he requested funding for accommodation, food and other logistics for the local, provincial and national branch co-ordinators and therefore was unable to talk to the issue.

 

157. Mr Chauke was unable to shed sufficient light into the issues to assist the focus of the investigation, nor provide any clarity, especially because he indicated that they kept no records of the activities of the campaign. According to him, even minutes of the meetings for the campaign were not recorded as they did not deem it necessary, thus echoing Mr Motlatsi’s sentiment.

 

158. It is worth mentioning that Mr Chauke was not helpful at all to my office. He alleged that he worked with branches both locally and provincially, but when requested to shed light into specific processes and procedures relating to accessing funds by these, he could not. Although he also shared the structure of the team, on how they were constituted, he elected not to respond to some questions despite having been mentioned earlier by Mr Motlatsi as the leader of the campaign.

 

159. On 08 March 2019, I conducted an interview with Ms Donne Nicol who is the adviser of President Ramaphosa, and had been mentioned particularly by the two (2) CR17 campaign managers, as well as President Ramaphosa as having been central in the issue under my investigation. She was also assisted by her legal representative.

 

160. According to her affidavit, which she took us through, she had been referred to Mr Gavin Watson by Mr Motlatsi in order to provide the former with the banking details into which the R500 000, 00 donation towards the CR17 campaign could be transmitted.

 

161. She also confirmed virtually all what the other two (2) members of the fundraising campaign had mentioned. For instance the pre-condition made to the donors that they should not expect any favours for having contributed to the campaign, as well as their identities and amounts pledged being deliberately concealed from President Ramaphosa.

 

162. Ms Nicol also confirmed what President Ramaphosa had stated that she had been the one who alerted him to the inaccuracy of his response in Parliament on 06 November 2018, because she had been the one who was responsible for opening the EFG2 trust account, as well as having facilitated the payment of R500 000, 00 to the CR17 campaign by Mr Watson into the account, and therefore knew all about it.

 

163. Ms Nicol stated that she knew President Ramaphosa for quite some time, in fact from President Ramaphosa’s stint at Shanduka where they worked together. She also indicated that she is the one who approached President Ramaphosa about the idea of asking for donations for his campaign where the idea was conceived and endorsed by those present. 

 

164. Ms Nicol also indicated that it was agreed that the identity of the donors and the amounts pledged should not be revealed to President Ramaphosa.

 

165. However, she was unable to sufficiently address a concern I raised about the pre-screening or vetting of donors for purposes of eliminating the ones who might be tainted such as AGO, who would negatively affect the campaign as well as the integrity of President Ramaphosa.

 

166. Ms Nicol also confirmed what Mr Motlatsi had indicated earlier in his interview that above R200 million was collected for the CR17 campaign.

 

167. Notwithstanding the unanimous statements by the CR17 campaign managers to me that it had been agreed that the identities of the donors and the amounts donated by them should not be disclosed to President Ramaphosa, evidence adduced has revealed the contrary.

 

168. Evidence adduced in a form of e-mails, invitations and instructions confirm that President Ramaphosa was constantly informed of the activities of the CR17 campaign by the campaign managers whereupon his advice and approval on specific matters, would from time to time be sought.

 

169. I have therefore established that in addition to having met with the potential donors during the banquet functions, where he delivered keynote addresses, evidence further confirm that President Ramaphosa had had further and broader interactions with the donors, some of whom he knew very well.

 

170. Although I did not conduct interviews with Mr Andile Ramaphosa, he made submissions to my office in a form of an affidavit dated 21 February 2019 in which he explained his business relationship with AGO. This was confirmed by the Advisory Mandate and the Anti-Bribery and Corruption Policy signed between his company, Blue Crane Capital (Pty) Limited and AGO in December 2017.

 

171. Mr Shivambu in his complaint, had made a specific request to me to investigate and confirm whether indeed there was a contract between Mr Andile Ramaphosa’s company, Blue Crane Capital and AGO as indicated by President Ramaphosa in his response to Mr Maimane’s question in Parliament on 06 November 2018.

 

172. Mr Andile Ramaphosa also submitted bank records which showed transactions of money received by his company, Blue Crane Capital (Pty) Limited from AGO for the work his company had invoiced them for the services rendered.

 

173. He also denied having a trust foundation linked to an account which the R500 000, 00 payment was allegedly paid into by AGO, nor did he receive any payment from an entity trading under the name and style of Miotto Trading.

 

174. He also submitted invoices generated and in respect of services rendered by his company to AGO for the period 05 December 2017 to 28 February 2018, as well as bank statements which confirm payments received by his company from AGO over this period.

 

175. According to the bank statements provided to my office by Mr Andile Ramaphosa, he received about 4 monthly payments of R171 000, 00 which in total was about R684 000 from AGO for the period mentioned above.

 

176. I then interviewed Mr Petrus Venter whose affidavit was primarily the source of the complaint by Mr Maimane as he was central in the transfer of the R500 000,00 payment to the EFG2 account. I also proceeded to interview Mr Gavin Watson and Ms Natasha Olivier who was AGO’s company secretary.

 

177. I interviewed Mr Petrus Venter on 21 February 2019 to understand facts relating to his role in the matter under investigation, in particular the transfer of the R500 000, 00 into the EFG2 account.

 

178. According to him, he had worked for AGO as a Tax Consultant in 2017. He was called by AGO’s CEO Mr Watson to his office in October 2017 and upon arrival, was taken to Ms Natasha Olivier’s office, who is AGO’s company secretary.

 

179. Ms Olivier was instructed by Mr Watson to transfer R3 million into the account of Miotto Trading, a small company which belonged to Mr Venter and his sister.
180. Mr Venter was then handed a piece of paper on with banking details by Mr Watson who instructed him to transfer R500 000, 00 to an EFG2 trust account which he was told was the trust foundation account of Mr Andile Ramaphosa.

 

181. He was informed by Mr Watson that the description of the transfer of the R500 000, 00 should be Social Development, and he did as he was instructed.

 

182. Mr Watson had also instructed him to transfer R2, 5 million to the account of Ms Lindie Gouws which he did on 19 October 2017.

 

183. He informed me that the transaction was however, cancelled and this money was later transferred back into Mr Watson’s account in batches of R500 000 x 2; R600 000 x 2 and R300 000 between 07 and 10 November 2017. The said transfer back of R2, 5 million on is confirmed by the bank records. Apparently Ms Gouws for some unknown reason, was no longer keen to receive it.

 

184. According to him, the affidavit referred to by Mr Maimane in his complaint was prepared on his behalf and that certain parts of what is reflected in it is not all true as certain things have been changed. However, everything pertaining to the transfer of R500 000, 00 is true. Mr Venter stated that in fact he had signed the affidavit referred to under duress.

 

185. Mr Venter further indicated that Mr Watson and AGO took advantage of his small company to effect some of their financial transactions, and that he was unable to refuse, hence the instruction to him to transfer the R500 000, 00 instead of using their own accounts.

 

186. During my interview of Mr Gavin Watson on 18 March 2019, he admitted that he had donated an amount of R500 000, 00 towards the CR17 campaign after he had been approached by one of the campaign managers, Mr Motlatsi to do so.

 

187. According to him, there was nothing untoward with his donation as a longstanding member of the ANC because he had over the years contributed financially to the ANC party’s election campaigns even during the former presidents before President Ramaphosa.

 

188. However, Mr Watson also stated that in the past he had donated to the ANC as a party and not to individuals as it was the case now, where he had to donate to both CR17 and NDZ individual campaigns.

 

189. He also expressed a concern to me that he thinks that this was a politically motivated attack on him by the opposition party.

 

190. Mr Watson confirmed although he did not attend all the dinner functions organised by the campaign managers, he was present at the one which was hosted by President Ramaphosa.

 

191. From the bank records at my disposal there had been several constant transfers of money between AGO, Concilium and Miotto Trading amounting to large sums and over a period of time.

 

192. I also proceeded to interview Ms Olivier who is Mr Watson’s PA/Secretary at AGO and was responsible for the transfer of the money, R3 million from Mr Watson’s personal account into Miotto Trading before part of it, about R500 000,00 was transferred into the EFG2 trust account.

 

193. She confirmed that she was instructed by Mr Watson to effect the transfer of the money referred to in my investigation, and that there was nothing extraordinary about this as it was in her scope of work to do the financial transfers for Mr Watson from time to time.

 

194. On 23 April 2019, I conducted interviews with three directors of the attorneys firm, Edelstein, Farber and Grobler (EFG) in order to get more information on how they administered the EFG2 trust account for the CR17 campaign. They were also assisted by their legal representative during the proceedings.

 

195. Mr Barry Farber who is the former director of EFG, stated that he had been approached by the CR17 campaign managers, in particular Ms Donne Nicol to open a trust account dedicated to the campaign which he did in compliance with all the legal requirements

 

196. According to him, it was with a specific mandate and clear forward instructions on how the account would operate.

 

197. Subsequent to verifying with their bank and their auditors, Levin Howarth, EFG Inc. was given the go-ahead to open the account for the CR17 campaign.

 

198. Mr Farber indicated that although Ms Ronnel Grobler was not involved in the physical opening of the account, she dealt with the transfer of funds to beneficiaries on instructions from the CR17 campaign managers, mostly from Ms Nicol. However, the bank records reflect her as one of the signatories to the bank mandate when the account was opened.

 

199. Ms Grobler on her account of what transpired, confirmed what had been said by Mr Farber, and that she would get telephonic instructions form Ms Nicol to pay X, Y or Z which she would comply with.

 

200. In conclusion the EFG directors indicated that the account was always audited and the balance sheet sent to the Law Society.

 

201. I need to mention that the advocate who had represented the EFG directors was quite unco-operative, as he from the onset raised unnecessary objections, which he continued to do throughout the proceedings despite having been informed that his clients if implicated, would be afforded an opportunity to rebut any such likely findings if any, against them.

 

202. Evidence on the disbursements of funds from the EFG2 trust account to several beneficiaries, including Ria Tenda Trust, Linked Environmental Services and Cyril Ramaphosa Foundation.

 

203. I had also subpoenaed bank records of the EFG2 trust account from the two banks involved in the above transaction, to establish how the alleged trajectory of the money occurred, so as to determine whether such movement was not improper as alleged by the Complainants that there were suspicions of money laundering which also needed probing.

 

204. From the evidence received by my office, I can confirm that the R500 000.00 payment was transferred from Mr Watson’s personal account as part of a lump sum of R3 million into the account of Miotto Trading and eventually into the EFG2 trust account, which is an attorneys trust account for the CR17 campaign.

 

205. I can also confirm that large sums of money were transferred by various benefactors into the EFG2 trust account for the CR17 campaign from where it was disbursed by the attorneys to several beneficiaries, including Ria Tenda Trust, Linked Environmental Services and Cyril Ramaphosa Foundation to name a few.

 

206. From the evidence received by my office, an amount of more than one hundred and ninety-one million rand (R191 482 227, 43) was deposited into the EFG2 ABSA trust account between 06 December 2016 and 01 January 2018 and just over one hundred and ninety-one million rand R190 108 227, 00 was transferred out of this account in the same period.

 

207. Evidence from bank records reflect that an amount of over three hundred and eighty-eight million rand (R388 544 340, 34) was deposited into SBSA Ria Tenda Trust account between 01 January 2017 and 20 February 2019 whilst nearly the same amount (R388 518 464, 55) was transferred out of it in the same period.

 

208. Records also reflect that four hundred and forty-one million rand (R441 179 572, 43) was deposited into the FNB account of Linked Environmental Services between 15 December 2016 and 13 February 2019 and almost the same amount (R441 147 804, 83) was transferred out of this account in the same period.

 

209. About three hundred and thirty-five thousand rand (R335 738 42) was transferred from Linked Environmental Services FNB account into the Cyril Ramaphosa Foundation between 20 July 2017 and 26 March 2018.

 

210. Out of all the donations received for the campaign, records reflect that there were three single largest donations of thirty million rand (R30 000 000, 00) on 09 March 2017; more than thirty-nine million rand (R39 620 000, 00) on 29 September 2017 and over fifty-one million rand (R51 506 000, 00) on the same date into the EFG2 ABSA trust account, which came from the same donor.

 

211. In conclusion, on the above revelations relating to exchanges of large sums of money, some of which received from private companies, I wish to express my preliminary view that such a scenario, when looked at carefully, creates a situation of the risk of some sort of state capture by those donating these moneys to the campaign.

 

1. Section 12 of the Prevention and Combating of Corrupt Activities Act (PACCA) provides that:
2. “Any person who, directly or indirectly-
3. Accepts or agrees or offers to accept any gratification from any person whether for the benefit of himself or herself or for the benefit of that other person or of another person; or
4. Gives or agrees or offers to give to any person any gratification whether for the benefit of that other person or for the benefit of another person
5. In order to improperly influence in any way-
6. The promotion, execution or procurement of any contract with a public body, private organisation, corporate body or any other organisation or institution; or
7. The fixing of the price, consideration or other moneys stipulated or otherwise provided for in any such contract; or
8. (ii)    as a reward for acting as contemplated in paragraph (a)
9. Is guilty of an offence.”

 

212. Section 3 of PACCA also provides for an all-encompassing general offence of corruption. In terms of this section, anybody who accepts (or even agrees to accept or offers to accept) any gratification from anybody else or gives (or even agrees to give or offers to give) any gratification to anybody else to influence the receiver to conduct himself or herself in a way which amounts to the unlawful exercise of any duties, commits the act of corruption.

 

213. PACCA also criminalises specific corrupt activities relating to, amongst others, public officers, contracts and the procurement of tenders. It also recognises the link between corrupt activities and other forms of crime such as organised crime and financial crimes including money laundering.

 

214. For instance, a criminal may attempt to integrate the funds he/she received from corrupt activity, such as bribe or kickback, into the financial system by channeling the funds through complex financial transactions during which he/she may involve several entities as conduits and use financial institutions as a means to disguise the corrupt source of funds as well as the ultimate beneficial owner of the proceeds of unlawful activity.

 

215. My investigation into the issue pertaining to possible money laundering is premised on the above legislation dealing with corruption and applies not only to private individuals who offer bribes, but also to private individuals who accept bribes.

 

216. It would therefore have been remiss of me not to deal with this aspect of the complaint so as to be able to confirm or dispel with any such suspicion as referred to in the allegations brought before me by the complainants.

 

217. Section 6(4)(c)(i) of the Public Protector Act provides that the Public Protector may, “at any time prior to, during or after an investigation, if he or she is of the opinion that the facts disclose a commission of an offence by any person, bring the matter to the notice of the relevant authority charged with prosecutions”.

 

218. Based on the facts before me as well as evidence adduced during my investigation, I have come to the conclusion that there is merit to the allegation relating to the suspicion of money laundering as alluded to in the complaint lodged with my office.

 

219. However, this feature of the investigation will be dealt with in conjunction with the provisions of section 6(4) (c) (i) of the Public Protector Act.

 

OBSERVATIONS

 

220. The rules of the National Assembly of 2016 clearly stipulate what processes and procedures need to be observed by Members of Parliament in connection with questions and answers they need to provide to the House during the parliamentary proceedings.

 

221. I have however, observed that despite the decorum of the House, some members seem not to make prior consideration of the questions they are required to prepare for and respond to orally, and/or do not pay sufficient attention to consider seriously the oral responses they need to provide to the House, despite being allowed sufficient time to do so prior to the sitting of Parliament. 

 

222. I am attributing this observation to the number of EMEA investigations I have had to deal with since taking office, all of which occur during the Question and Answer session, and emanate from the ill-considered oral responses provided by the Members of Parliament in which consequently, they would have been regarded to have misled the House, inadvertently or deliberately.

 

223. Even the EMEA matter that I have just investigated as lodged by Mr Maimane, was clearly not dealt with in accordance with the Rules of Parliament in that he was allowed to pose a follow-up question which was in no way related to the original question he had asked President Ramaphosa.

 

224. Furthermore the Rules of the National Assembly are also silent on whether the Members of Parliament are allowed to make subsequent written submissions in order to correct or clarify the oral replies they may have provided to the question posed to them during the Question and Answer session of the House.

 

225. I have also observed that it is against any potential of state capture, which all South African state functionaries, including the President, should guard against exposing themselves to a situation involving the risk of a conflict between their official responsibilities and private interests, which is in violation of section 96 of the Constitution.

 

SECTION 7(9) NOTICE

 

226. As part of the investigation process, I served a notice in terms of section 7(9)(a) of the Public Protector Act dated 30 May 2019 on President Ramaphosa to afford him an opportunity to respond to my provisional findings by 13 June 2019. However, on 07 June 2019, a request for an extension was received from his attorneys citing several reasons for the request for indulgence until 28 June 2019.

 

227. Whilst awaiting a response to the notice, I received a request from President Ramaphosa’s attorneys to be afforded access and opportunity to cross examine Mr Gavin Watson, Mr Maimane as the Complainant in the matter as well as the bank officials who had been subpoenaed to appear before me in terms of section 7(4) of the Public Protector Act.

 

228. I then acceded to the request in so far as it related to Mr Watson but with a clear indication to him of his rights as far as the request was concerned. However, I advised President Ramaphosa that Mr Maimane is the Complainant in the matter and therefore could not be questioned as he and the bank officials had not appeared before me in terms of section 7(4) of the Public Protector Act.

 

229. Although there were challenges with regard to President Ramaphosa’s attorneys to access Mr Watson with whom all contact was through his attorneys, these were in no way attributable to my office as I had given the go-ahead to such an engagement. My office experienced the same challenges in trying to reach Mr Watson to whom a written request was sent to get his co-operation. However, this did not yield any desired response from him.

 

230. Consequently I had to resort to my subpoena powers to compel Mr Watson to respond to President Ramaphosa’s questions which had been transmitted to him through his attorneys by attorneys acting for my office.

 

231. In the end, a response dated 04 July 2019 was received from Mr Watson’s attorneys. Mr. Watson, in his response, ostensibly stated that he lied under oath whilst responding to questions I posed to him during his interview in my office on 18 March 2019. Mr Watson also deposed an affidavit through his attorneys dated 03 July 2019.

 

232. In this regard Mr Watson has committed an offence under the provisions of the Criminal Procedure Act 56 of 1955 as well as section 11 (3) of the Public Protector Act, 23 of 1994, and the matter will be dealt with accordingly.

 

FINDINGS

 

233. Having considered the evidence uncovered during the investigation against the relevant regulatory framework, including the response to the section 7(9) notice, I now make the following findings:

 

1. Regarding whether on 06 November 2018 during question session in Parliament, President Ramaphosa deliberately misled the National Assembly and thereby acted in violation of the provisions of the Executive Ethics Code and Code of Ethical Conduct and Disclosure of Members’ Interests for Assembly and Permanent Council Members.

 

1. The allegation that on 06 November 2018 during question session in Parliament, President Ramaphosa deliberately misled the National Assembly, is substantiated.
2. President Ramaphosa’s statement on 06 November 2018 in his reply to Mr Maimane’s question albeit defective in terms of the Rules of the National Assembly, was misleading, as he also conceded in his correspondence to my office on 01 February 2019, and even in his subsequent letter to the Speaker of the National Assembly on 14 November 2018 where he sought to correct the incorrect information he had provided in the National Assembly.
3. Consequently, President Ramaphosa’s reply was in breach of the provisions of paragraph 2.3(a) of the Executive Ethics Code, the standard of which includes deliberate and inadvertent misleading of the Legislature. He deliberately misled Parliament, in that he should have allowed himself sufficient time to research on a well-informed response.
4. I therefore find President Ramaphosa’s conduct as referred to above although ostensibly in good faith, to be inconsistent with his office as a member of Cabinet and therefore in violation of section 96(1) of the Constitution, as referred to above.

 

2. Regarding whether President Ramaphosa improperly and in violation of the provisions of the Executive Ethics Code and Disclosure of Members’ Interests for the National Assembly and Permanent Council Members exposed himself to any situation involving the risk of a conflict between his official duties and his private interest or used his position to enrich himself and his son through businesses owned by African Global Operations.

 

1. The allegation that President Ramaphosa improperly and in violation of the provisions of the Executive Ethics Code and Disclosure of Members’ Interests for the National Assembly and Permanent Council Members exposed himself to any situation involving the risk of a conflict between his official duties and his private interest or used his position to enrich himself and his son through businesses owned by AGO, is substantiated.

 

2. In light of the evidence before me, it can be safely concluded that the campaign pledges towards the CR17 campaign were some form of sponsorship, and that they were direct financial sponsorship or assistance from non-party sources other than a family member or permanent companion, and were therefore benefits of a material nature to President Ramaphosa.

 

3. President Ramaphosa as a presidential candidate for the ANC political party, received campaign contributions which benefitted him in his personal capacity. He was therefore duty bound to declare such financial benefit accruing to him from the campaign pledges. Failure to disclose the said material benefits, including a donation from AGO constitutes a breach of the Code.

 

4. I have evidence which indicate that some of the money collected through the CR17 campaign trust account was also transferred into the Cyril Ramaphosa Foundation account from where it was also transferred to other beneficiaries.

 

5. President Ramaphosa at the time of receipt of the donations, was the Deputy President of the Republic of South Africa and a Member of Parliament. He was therefore bound by the Code of Ethical Conduct and Disclosure of Members’ Interest for Assembly and Permanent Council Members, to declare such financial interest.

 

6. I therefore find President Ramaphosa’s failure to disclose financial interest which accrued to him, as a result of the donations received towards the CR17 campaign to be in violation of paragraph 2 of the Executive Ethics Code, and accordingly amounts to conduct that is inconsistent with his office as member of Cabinet, as contemplate by section 96 of the Constitution.       

 

3. Regarding  whether there is an improper relationship between President Ramaphosa and his family on the one side, and the company African Global Operations on the other side, due to the nature of the R500 000, 00 payment passing through several intermediaries, instead of a straightforward donation to the CR17 campaign, thus raising the suspicion of money laundering.

 

1. The allegation that there is an improper relationship between President Ramaphosa and his family on the one side, and the company African Global Operations on the other side, due to the nature of the R500 000, 00 payment passing through several intermediaries, instead of a straight donation towards the CR17 campaign, thus raising suspicion of money laundering, has merit.

 

2. I have taken into account of the facts as well as prima facie evidence before me, I am therefore of the view that there is merit to the allegation relating to the suspicion of money laundering as alluded to in the complaint lodged with my office.

 

3. However, I have decided to refer this matter to the relevant institution for further probing as provided for in section 6(4) (c) (i) of the Public Protector Act which states that the Public Protector may, “at any time prior to, during or after an investigation, if he or she is of the opinion that the facts disclose a commission of an offence by any person, bring the matter to the notice of the relevant authority charged with prosecutions”.

 

REMEDIAL ACTION

 

244. The appropriate remedial action taken as contemplated in section 182(1)(c) of the Constitution, with a view of remedying the impropriety referred to in this report is the following: 

 

1. The Speaker of the National Assembly to:

 

1. Within 30 working days of receipt of my Report, refer His Excellency President Ramaphosa’s violation of the Code of Ethical Conduct and Disclosure of Members’ Interests for Assembly and Permanent Council Members to the Joint Committee on Ethics and Members’ Interests for consideration in terms of the provisions of paragraph 10 of the Parliament Code of Ethics.

 

2. Within 30 working days of receipt of my Report, consider within her discretion, deliberations by Members of Parliament in terms of the Rules of the National Assembly, issues relating to my observations under paragraphs 6.1 to 6.5 of my Report for possible review and amendment thereof.

 

3. Within 30 working days of receipt of my Report, demand publication of all donations received by President Ramaphosa because as he was the then Deputy President, he is bound to declare such financial interests into the Members’ registerable interests register in the spirit of accountability and transparency.

 

2. The National Director of Public Prosecutions to:

 

1. Within 30 working days of receipt of this Report, take note of the observations contained in paragraph 7.3.1. as well as the recommendations contained in paragraph 7.3.3 of this report, and in line with section 6(4)(c)(i) of the Public Protector Act, conduct further investigation into the prima facie evidence of money laundering as uncovered during my investigation, and deal with it accordingly.

 

3. The National Commissioner of the South African Police Service to:

 

1. Within 30 working days of receipt of this Report, investigate criminal conduct against Mr Gavin Watson for violation of section 11 (3) of the Public Protector Act, 23 of 1994 by lying under oath.

 

Thank you.