Red flags regarding the regulations for the State Capture Commission

13 February 2018

On Friday 9 February 2018 the regulations relating to the State Capture Commission (SCC) were published in the Government Gazette. It is prudent to raise a number of red flags in relation to their content and effect.

Firstly, the person put in charge of the purse strings of the SCC is none other than the captured Minister of Justice, Michael Masutha, who was instrumental in negotiating the settlement agreement that saw Mxolisi Nxasana, the last independent functionary, leave office (at an astronomical cost) to be replaced by Shaun Abrahams as National Director of Public Prosecutions. A safer pair of hands for the capturers of the state is hard to imagine.

Abrahams’ fitness for office and the validity of his appointment will be finally determined in the appeal due for hearing in the Constitutional Court on 28 February, 2018. The Full Bench of the Gauteng North High Court has already ruled the settlement agreement invalid and has set it, and Abrahams’ appointment aside.

Masutha is a suspect in an ongoing criminal investigation of corrupt activities that surrounded and constituted the conclusion of the settlement with Nxasana; an investigation that is now due for completion, the investigating Hawks having confirmed to the complainant, Accountability Now, that they have duly noted the civil court findings that the agreement was invalid, illegal and unconstitutional in the review proceedings.

An attempt to defeat the ends of justice that will involve a credibility dispute between Nxasana and presidential consigliere, Michael Hulley, is also part of the complaint. There is also a complaint to the Law Society about the impropriety of Hulley’s role in the matter which is under investigation at glacial speed.

The High Court was prepared, without the benefit of hearing oral evidence, to find that the president’s version of how it came about that Nxasana’s services were terminated is false. This finding has the potential to put Zuma and Masutha on the hook in the criminal case. Nxasana is participating in the appeal and steadfastly sticks to his version, which is supported by the contemporaneous documentation and correspondence.

If it is found that Nxasana was approached by Hulley to lie on oath about the circumstances of his departure from office, on whose instructions was Hulley doing so? Zuma and Masutha are the only obvious answers to this question. Hulley is far too canny to embark upon a frolic of his own. He had apparently given the two directly implicated members of the cabinet his advice that the deal was corrupt unless it could be shown that Nxasana asked to leave his post, which Nxasana has denied at all stages.

The advice given is sound, the denial fatal to the accused in the contemplated criminal case. Needless to say, on Abrahams’ watch, the NPA has done everything possible to stall the complaint. Even the winds of change at Luthuli House have not stirred the prosecutors in action. Yet.

It is fair to conclude from all the surrounding circumstances that Nxasana’s professed willingness to continue with the prosecution of Jacob Zuma was the real reason for his departure from office and that Masutha colluded in arranging for this to take place as a part of the capture of the National Prosecuting Authority’s leadership with a view to facilitating the capture of the state both more comprehensively and with impunity. It is unimaginable that Nxasana would have attempted to prosecute Pravin Gordhan on charges trumped up by the captured Hawks, followed by the spectacular U turn which Abrahams executed. His safe hands still guide the prosecutors in the land. The net effect of this pantomime was the capture of the treasury and the deployment of the captured Malusi Gigaba in place of Gordhan.

In these circumstances, Masutha, who was a party to the Nxasana settlement, is a grossly unsuitable person to be put in charge of the “oxygen supply” of the SCC. Putting the fox in charge of the henhouse is frowned upon in fable and metaphor; asking the fox to finance the building of the henhouse, paying its staff and fixing its overall operating budget is simply not on. Masutha’s clear conflict of interest is so cringe-worthy that it beggars belief that his department has lit upon him and the controller of the budget of the SCC. Clearly Zuma, still deep in denial of the obvious, sees personal advantage (but not public benefit) in having his trusted henchman in charge of the finances of the SCC.

Due to the fact that the cabinet members are collectively and individually responsible for the exercise of their powers and the performance of their functions, it is not appropriate that anyone in the cabinet should control the finances of the SCC.

Secondly, there are two provisions in the regulations for the SCC that require careful scrutiny and, possibly, urgent revision.

They are Regulations 8(1) and 8(2) which read:

8. (1) No person appearing before the Commission may refuse to answer any question on any grounds other than those contemplated in section 3(4) of the Commissions Act, 1947 (Act No. 8 of 1947).

(2) No evidence regarding questions and answers contemplated in sub - regulation (1), and no evidence regarding any fact or information that comes to light in consequence of any such questions or answers, shall be admissible in any criminal proceedings, except in criminal proceedings where the person concerned is charged with an offence in terms of section 6 of the Commissions Act, 1947 (Act No. 8 of 1947), or regulation 12.

Section 3(4), in part, provides that:

“…the law relating to privilege as applicable to a witness giving evidence or summoned to produce a book or document in such a court, shall apply.”

Section 6 and regulation 12 in turn deal with offences against or before the SCC itself, not with state capture which is the subject matter of the SCC.

Those with a jaundiced view of the Zuma presidency may see in these provisions a trap designed not to expose but to free from criminal prosecutions all those who confess before the SCC. Indeed, properly advised, those implicated in wrongdoing should be falling over themselves and each other to give evidence to the SCC so that the criminal justice administration is blocked from using it against them in the prosecutions long needed but thus far not forthcoming.

Michael Hulley, the legal advisor to the President, is sure to claim legal professional privilege; he did, improperly so, when asked how he got hold of the spy tapes back in 2009. The fair trial right of all accused persons not to be compelled to give self-incriminating evidence set out in section 35(3)(j) of the Bill of Rights might also be invoked by others called to testify before the SCC.

It should be noted that the provisions of Regulation 8 are identical to those gazetted in the Farlam and Seriti commissions of inquiry into the Marikana tragedy and the four 1999 arms deals respectively. No criminal prosecutions have followed upon the reports of those commissions. This may, in part, be due to the content of Regulation 8.

It does not mean that the same mistake should be perpetuated in the SCC. The circumstances are different. The facts of Marikana and the four arms deals were carefully covered up by the perpetrators and others who had benefitted by the wrong-doing under investigation. With state capture, different considerations apply.

The #Guptaleaks, which took place after the State of Capture Report was prepared by Thuli Madonsela, comprise a treasure trove of information regarding the nuts and bolts of the process of state capture. Many more deals than the four under investigation by the Seriti Commission are involved in state capture. Sufficient prima facie evidence of criminal activities is already in the public domain. The PARI and SACC reports as well as the books written by investigative journalists could keep engaged prosecutors busy gathering facts for targeted prosecutions for months.

The rationale for including the provisions of Regulation 8 does not exist in the circumstances which pertain to the phenomenon of state capture.

Normally the trade-off of immunity against prosecution is given to witnesses in commissions of inquiry in order to allow the executive branch of government to be apprised of the full facts so that it can decide upon appropriate remedial steps to be taken in the light of the sharing of otherwise secret knowledge. In other words, it is generally rational to grant immunity in exchange for the provision of unknown information to the commission.

As Paul O’Sullivan of Forensics for Justice has already scientifically vouched for the authenticity of the #Guptaleaks (also confirmed to be genuine in some respects from within the presidency itself) the work of the SCC does not necessarily involve the uncovering of unknown information. Accordingly its work should not inadvertently be the pretext for delivering “get out of jail free” cards to those who choose to share and over-share with the SCC.

Finally, there is a further wrinkle arising from the wording of section 1 of the Act. It provides that the President make:

It is not for the Public Protector, the Commissioner or anybody else to assume these functions. The legislature has delegated them to the President and he may not delegate them to anyone else, nor may the Public Protector assume them or delegate them to the Commissioner by saying, as she did, use my report as your “starting point”.

Any conflicted presidents or even presidents at risk of conflict of interest who are unable to act may be substituted, by the operation of sections 90 and 96 of the Constitution, by their deputy for the purposes of setting up a commission but they or their deputy cannot delegate the duties under the Act. The Ratnagopal decision in the Privy Council in 1969 applies.

What Thuli Madonsela should have done was to ask (not tell) the Deputy President, Cyril Ramaphosa, to appoint a commission of inquiry into state capture. Only if he refused to do so without justification would it become necessary to apply to court for an order compelling him to do so. It is in this way that the Seriti Commission came into existence. It is not appropriate, given the separation of powers doctrine, which is part of our law and much in favour with the Chief Justice, for the Public Protector to assume powers which parliament has given to the president. It was accordingly not appropriate for Madonsela to take the remedial action set out in her State of Capture report. She ought to have invoked section 90 read with section 96 of the Constitution and she ought to have respected the delegatus non potest delegare principle that applies.

Should the SCC proceed in the face of all these red flags, the best option now, in the absence of revision of the regulations, is for the SCC simply to recommend prosecutions forthwith, without receiving evidence itself. This step can be taken in the light of the amount of information already in the public domain. Fact finding when the facts are already known is superfluous, costly and prejudicial to the administration of criminal justice in the land. If the regulations stand, then taking evidence precludes that evidence from being used in prosecutions which should follow. If there are any substantial witnesses who are currently unknown and who might only come forward if indemnified, it is their civic duty to approach the SCC now and to spill the beans before any moves to correct, amend or substitute the regulations are made.

Issued by Paul Hoffman, Director of Accountability Now, 13 February 2018