DA lays anti-corruption charges against ANC Youth League
The DA has laid anti-corruption charges against the leadership of the ANC Youth League and against Board members of its investment wing Lembede Investment Holdings (LIH).
This arises from reports that the league's executive and Lembede's board will not take action against those allegedly implicated in a vast tangle of irregularities and possible fraud and corruption uncovered by a Gobodo audit report that was commissioned last year by league president Julius Malema.
I laid the charges yesterday (Sunday 2 August) at the Johannesburg Central Police Station (see affidavit below).
LIH Board members and the ANC Youth League Executive Committee are charged in terms of section 34 of the Prevention and Combating of Corrupt Activities Act 12 of 2004 which makes it an offence not to report a corrupt act to the police, as well as section 20 of this act as an accessory after an offence. They are also charged with the common law offence of "defeating the ends of justice".
I have furthermore requested the police to investigate nine findings by the Gobodo report as reported by the Sunday Times newspaper (see article) concerning multi-million rand deals that allegedly point to fraud, unjust enrichment and contravention of the Companies Act. This includes dealings with the late Mr Brett Kebble.
The ANC Youth League is setting an appalling example by trying to sweep the disturbing findings of the Gobodo report under the carpet.
They preach socialist ideals, yet appear to have indulged in unscrupulous business dealings.
Youth league big wigs are notorious for living the high life, now we see where they got their money as the Gobodo report tracks 32 deals worth at least R436 million.
Corruption in private companies needs to be fought as much as public sector corruption as it unjustly enriches certain people at the expense of others and wastes money that should be used productively.
Corrupt people must be brought to book, and so must bystanders to corruption who become accomplices if they do not report it.
I will monitor the police to ensure that they properly investigate this matter that could ensnare former high-profile youth league leaders like Lunga Ncwana and Songezo Mjongile, and Malose Kekana, the interim chief executive of the National Youth Development Agency.
The entire ANC Youth League executive will also face police questions about their inaction after being presented with the findings of the Gobodo report.
Note: I originally intended to lay nine separate charges in terms of legal advice (see sections 9 and 10 below), but the senior officer on duty refused this, irregularly in my view. I will attempt to lay the nine separate charges today at the Sandton Police Station which covers the area in which LIH has its offices.
STATEMENT
I, the undersigned,
Jack Brian Bloom
do hereby make oath and state the following:-
1. I am an adult male of full legal capacity with identity number 610102 5048 083. I am an elected member of the Gauteng Provincial for the Democratic Alliance (DA) and its designated spokesman on corruption in this province telephone 011 498 5979, 082 333 4222.
2. The facts herein contained are, as save where otherwise stated or as appears from the context, within my own personal knowledge and belief, true and correct. However, I need to mention that the main content of this statement is based on hearsay evidence and specifically a report titled "The ANC Youth League and the missing millions" that appeared on the front page of the Sunday Times published on Sunday 2009-08-02.
3. I am therefore well aware that the content of this statement is not to set the solitary basis for the purposes of prosecution nor does this statement contain irrefutable evidence of fact for the purposes of prosecution, but is designed to assist law enforcement agencies to investigate information that has now become public knowledge. I admit that the basis of this statement heavily relies on a presumption that the newspaper report referred to herein is true, factual, accurate and corroborated before it was printed. I am well aware that a newspaper report does not necessarily automatically initiate a police investigation and therefore I shall do whatever is needed to assist the police in establishing culpability (if any) and to report progress and findings to the community I serve.
4. The aforementioned newspaper article focuses on a report by a certain "Gobodo" auditors into the affairs and activities of "Lembede Investment Holdings" (LIH), which is the investment company of the ANC Youth League. According to these reports, the Gobodo report examined 32 deals worth more than R436 million that involved LIH and its subsidiaries. The findings of this report apparently indicate, inter alia, many irregularities, breach of accounting procedures and contravention of the Companies Act.
5. Mr Pule Mabe, the chairman of LIH Board, has reportedly said that no criminal charges will be laid against anyone arising from issues dealt with by the Gobodo report.
6. According to the aforementioned newspaper article, the Gobodo report proposes follow-up inquiries with current and former Lembede officials, including Messrs Lunga Ncwana, Songezo Mjongile, Pumezo Mqingwana, Lonwabo Sambudla, Malose Kekana and also businessman Mr Sello Rasethaba. A number of the above-mentioned were also reportedly associated with the business activities of the late Mr Brett Kebble.
7. What concerns me is that Mr Pule Mabe and the LIH Board are failing to take the appropriate action in relation to apparent criminal acts and corruption. As far as I am aware this may constitute an offence in terms of Section(s) 34 and/or 20 of the Prevention and Combating of Corrupt Activities Act, Act 12 of 2004. Alternatively, it may constitute an offence in relation to the common law offence "Defeating the Ends of Justice".
8. I am also concerned that according to the above-mentioned media report, the Executive Committee of the ANC Youth League has also decided not to take the appropriate action as outlined in 7 above, and therefore the same offences listed there should also apply to members of this committee. There may be other people and bodies that also need to be investigated with regard to their knowledge of the Gobodo report and failure to act appropriately in this regard.
9. According to the Sunday Times, the Gobodo report said:
1. "Kekana, former chief of Lembede's Progressive Youth Investment Company - a Lembede associated company failed to account for R2-million paid by Nedbank for PYIC's stake in the People's Bank;
2. There is no record of any benefits being banked by LIH from its 10% stake in empowerment company Phikoloso Mining, which, at one point, held R270-million in shares in Kebble's Randgold & Exploration Company;
3. There is no trace of LIH's R45 000 share of a consultancy contract awarded to Nghala Mining, nor of its 5% holding, said in the report to be worth R5-million;
4. The LIH board was told in 2006 that the company's stake in a company called Matodzi Engineering, one of Rasethaba's companies, had been sold for R2 888 889, but only R2.5-million Was banked, leaving R388 889 unaccounted for;
5. In 2003, Lembede set up a joint venture with, Mococh, an oil company based on the Isle of Man, to import oil into South Africa and export it from here to neighbouring countries, including Zimbabwe. The venture only concluded one transaction - on behalf of PetroSA - and there is no record of any income from the deal being banked by LIH;
6. Lembede bought a share in the company Fibretek when it was sold off by Denel, but defaulted on its obligation to contribute RI-million to the company's operating capital. As ' a result, Lembede's share was sold for R200 000, but Gobodo could not find what had happened to that income. The audit report suggests there could have been a violation of the Companies Act;
7. Gobodo was unable to find any records concerning six deals reportedly entered into by LIH and was also unable to find enough documentation to assess the status of a deal between Lembede and Kebble's JCI Gold. The deal appeared to include mineral rights and fishing licences;
8. LIH distributed R4.6-million to shareholders after selling its stake in Mahube consortium, which owned platinum mining rights, and LIH chairman Pumezo Mqingwana distributed a further R90 000 to unidentified beneficiaries from a "discretionary fund". Gobodo calls for more information on the transaction and the unexplained fund;
9. LIH entered into a scrip lending agreement with Kebble in 2005. It later emerged that Lembede did not actually own some of the stock it had put up as security and that LIH might have signed an agreement without understanding what was being agreed to;
10. Mjongile has to answer why there was only one transaction from PetroSA and what happened to the proceeds of the deal; and
11. Mjongile has to further explain what happened to the R200 000 reported to have been received from Fibretek deal."
10. If the aforementioned allegations are true, the following should be established:
1. In relation to par 9.1. it should be established what the reasons are why those alleged funds cannot be accounted for and if there are any nefarious acts related to such non-disclosure and if so, those responsible should be held accountable both criminally and financially.
2. In relation to par 9.2. the alleged records should be traced and audited to establish whether there are any irregularities regarding the benefits from shares. If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
3. In relation to par 9.3. the alleged share certificates should be traced and audited to establish whether there are any irregularities regarding the benefits from derived from those shares. If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
4. In relation to par 9.4. the alleged sale agreements should be traced and checked to establish whether there is in fact a shortfall between the sale price and what was declared. If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
5. In relation to par 9.5. the alleged transaction should be traced and audited to establish whether there are any irregularities regarding the benefits from derived from the alleged transaction(s). If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
6. In relation to par 9.6. the alleged sale transaction should be traced and audited to establish whether there are any irregularities regarding the benefits from derived from the alleged transaction(s). If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
7. In relation to par 9.7. the alleged deals and related documentation should be traced and audited to establish whether there are any irregularities regarding the benefits from derived from the alleged transaction(s). If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
8. In relation to par 9.8. the alleged beneficiaries should be traced and establish how and on what basis they became beneficiaries and related fund distribution records should be traced and audited to establish whether there are any irregularities regarding the benefits from derived from the alleged transaction(s). If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
9. In relation to par 9.9. the alleged misrepresentation and related documentation should be traced and audited to establish whether there are any irregularities regarding the benefits from derived from the alleged transaction(s). If there are any nefarious acts related thereto, those responsible should be held accountable both criminally and financially.
10. In relation to this aspect, to what extent, if any, were the members of the LIH Board and the leadership of the ANC Youth League involved in either the commission of possible criminal offences or the covering up thereof. If any of them claim that they did not have any knowledge of such activities, how it was possible.
11. If the members of the LIH Board and the leadership of the ANC Youth League did have knowledge of this and any other alleged illegal acts, why they failed to report it. If any of the Board's or ANC Youth League Leadership's alleged conduct or failure to perform conforms to the requirements for criminal prosecution, I request that any and all that should be held responsible be given an opportunity to explain their positions in a court of law.
12. I think it to be highly unlikely that the LIH Board and the ANC Youth League's Leadership will be able to claim incompetence and ignorance to the level that a court would believe that they should not be held responsible.
13. I know and understand the contents of this statement and have no objection to taking the prescribed oath, which I consider to be binding on my conscience.
________________________
DEPONENT
THUS SIGNED AND SWORN BEFORE ME AT ___________________ ON THIS __________DAY OF _____________________ 2009, THE DEPONENT HAVING ACKNOWLEDGED THAT HE KNOWS AND UNDERSTANDS THE CONTENTS OF THIS AFFIDAVIT, THAT HE HAS NO OBJECTION TO TAKING THE PRESCRIBED OATH AND THAT HE CONSIDERS THE OATH TO BE BINDING ON HIS CONSCIENCE.
_____________________________________
COMMISSIONER OF OATHS/ JUSTICE OF THE PEACE
FULL NAMES AND SURNAME
RANK
ADDRESS
Statement issued by Jack Bloom MPL, Democratic Alliance Gauteng corruption spokesperson, August 3 2009
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