Ethics Committee unable to make finding on allegations of breach of code against Hon Malema

2 October 2023

The Joint Committee on Ethics and Members’ Interests has resolved that it is unable to make a finding regarding a possible breach of the Code of Ethical Conduct and Disclosure of Members’ Interests for National Assembly and Permanent National Council of Provinces Members against Hon Julius Malema MP.

The complaint was referred to the committee on 18 October 2019 by Hon John Steenhuisen MP alleging that Hon Malema breached the Code as it relates to the Venda Mutual Bank scandal. The complaint was based on a media report in the Daily Maverick dated 8 September 2019 and alleged that the Member:

benefited from VBS funds through Mahuna Investments.

did not disclose the benefit in his 2017 and 2018 declaration of interests.

used the life savings of vulnerable VBS depositors and municipalities to fund his extravagant lifestyle, business interests and political aspirations.

used about R4.13m, which was paid to the EFF from an illegal sum of R16.1m that was part of the illegitimate Sgameka Projects Company.

participated in a scheme to mask the origin and ultimate beneficiaries of these funds.

failed to disclose these alleged connections with Mahuna Investments and subsequently misled Parliament to believe that he was not connected to Mahuna Investments.

In considering the matter, the committee resolved to summon the liquidator in the VBS matter to furnish it with a report on the movement of money in the VBS scandal. The report was presented to the committee on 23 August 2021. In terms of the report, Sgameka Projects paid R4 803 180 into an ABSA bank account belonging to Mahuna Investments.

The Sgameka account was identified by the liquidator as the account into which money from the VBS was paid and then transferred out into other bank accounts held by both natural and juristic persons. In terms of the report, the Member did not hold a bank account with the VBS. The report also indicates that no money was transferred from the Sgameka bank account to the Member. There is no reference in the report to any account held by the Member that may implicate him in the VBS scandal.

The committee resolved to summon the Financial Intelligence Centre (FIC) to obtain financial intelligence on whether the Member received money through Mahuna’s ABSA bank account. The FIC held the view that in terms of section 40 the Financial Intelligence Centre Act, No 38 of 2001, it would be unlawful for it to provide the committee with financial intelligence. The committee was in the process of invoking section 14 of the Powers, Privileges and Immunities of Parliament and Provincial Legislatures Act, 4 of 2004 against the FIC, but after receiving legal advice, did not proceed with issuing the summons.

The committee noted that section 40 of the Financial Intelligence Centre Act prevented the committee from pursuing the allegations further. To this end, the committee’s investigation is inconclusive as the committee was not in possession of sufficient information to make a finding. The committee decided to close the file in the matter.

Issued by Malatswa Molepo, Media Officer, Parliamentary Communication Services, 2 October 2023