City Council approved process to cut ties with State Capture Linked Regiments
29 November 2018
Today, Council has approved a report authorising the City Manager to enter settlement negotiations with Regiments Fund Managers (Regiments) in order to terminate the City’s relationship with this institution, which has been linked to the nefarious state capture project.
The City has sought to end its relationship with the fund managers on the grounds of:
- The negative publicity around Regiments emanating from the 11 February 2018 article alleging links between Regiments and Gupta linked Trillian, in particular Regiment’s close association with the allegations on State Capture, which impacts on the reputation and integrity of the COJ;
- Failure by Regiments to honour the full redemption payments that were due to the COJ on 5 June 2018;
- Failure by Regiments to timeously advise the City that Denel would not be in a financial position to meet its obligations in respect of the unsecured loan amounting to R290 million that initially matured on 10 June 2018; and
- Failure by Regiments to ensure that all fees and commissions received as a consequence of the Sinking Fund transactions and which were for the benefit of the COJ Sinking Fund, were deposited into the Sinking Fund bank accounts.
In the interests of a swift end to our relationship with Regiments, the City will seek to terminate its relationship with the fund managers via mutual agreement. It is our hope that this agreement can be finalised within the coming weeks.
As part of the City’s investment structure, the City utilises a sinking fund to pay back inherited debts and investments made to the City, amounting to over R18 billion. Regiment’s handling of our residents’ hard earned money is thus of serious concern to the City.
Since coming into office, the multi-party coalition government has committed itself to ridding the City of rampant corruption which was allowed to fester within the City.
As a result, the City has appointed an external independent firm of attorneys to conduct a comprehensive forensic investigation into the sinking fund. The scope of the investigation covering the period 2005 to date includes, inter alia the following:
- The circumstances and processes surrounding the appointment of Regiments to manage the City’s sinking fund; and
- The transactions concluded by Regiments pursuant to the performance of its obligations in terms of the PMA.
Already, significant progress has been made with the forensic investigation and the outcome is expected soon.
It is expected that this will once again expose senior members of the former administration, whose actions not only robbed the residents of this City, but ultimately aided the nefarious state capture project which has paralysed government at a national level.
I will continue to ensure that residents of this City grow in their confidence for the multi-party government to lead ethically, putting the needs of the residents first.
Issued by Luyanda Mfeka, Director: Mayoral Communications, Office of the Executive Mayor, 29 November 2018
