Admin
03 Dec, 2025
R3.5 trillion at risk: the Public Investment Corporation’s appearance at the Standing Committee on Finance – further issues and pertinent questions that need to be asked of the PIC
Dr Mkhacani Maswanganyi, MP Chairperson of the Standing Committee on Finance PO Box 15 Cape Town 8000 Dear Dr Maswanganyi R3.5 trillion at risk: the Public Investment Corporation’s appearance at the Standing Committee on Finance – further issues and pertinent questions that need to be asked of the PIC 1. Further to my correspondence dated 10 November 2025 , in which you were copied, I understand that the Standing Committee on Finance (SCOF) is scheduled to receive a report from the Public Investment Corporation (PIC) on 5 December 2025. 2. In regard, I wish to refer SCOF to my correspondence to the President of the Republic of South Africa, Mr MC Ramaphosa and the Chairperson of the Standing Committee on Public Accounts (SCOPA), Mr Songezo Zibi, MP, which I attach for your ease of refence: 2.1. On 29 October 2025 regarding: “R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action ” and 2.2. on 8 November 2025 regarding: “Renewed concerns over probable governance irregularities and conflicts of interest at the Public Investment Corporation: the PIC’s confused(ing) rhetoric regarding the Lanseria and FlySafair deals” . 3. I understand from the SCOPA Chairperson Zibi, that he has referred the entire matter concerning the PIC, as submitted by the UDM, to SCOF for further consideration, as SCOPA is currently engaged in the Road Accident Fund inquiry and both committees share several members. 4. In addition to the above, there have been further developments which I wish to bring to SCOF’s attention, and I refer the Committee to the following documents attached for ease of reference: 4.1. A 30 October 2025 correspondence from Mabotja Attorneys on behalf of Acapulco Trade & Invest 164 (Pty) Ltd, dated 30 October 2025, regarding “FORMAL CLARIFICATION & REPRESENTATION IN RESPECT OF THE LANSERIA HOLDINGS (PTY) LTD TRANSACTION.” as well as a 4.2. 7 October 2025 correspondence from Mabotja Attorneys to Werksmans Attorneys, acting on behalf of the PIC, regarding: “LANSERIA AND RELATED MATTERS”, 5. For additional context to the bigger scheme of things, I refer to an article published in the Business Day of 5 November 2025 entitled” “PIC furious over R400m payout to Lanseria BEE partner” 6. Given the context outlined in all the UDM’s correspondence and the article referenced above, it is evident that SCOF will need to conduct a thorough and far-reaching investigation into the broader operations of the PIC, particularly its dealings involving PAIDF I and II and the investment of Government Employees Pension Fund (GEPF) funds. The arbitration award in favour of Acapulco, dated 17 September 2025 and amounting to R411 282 264.44, has clearly unsettled matters and exposed deeper issues within the PIC’s governance and investment practices. 7. Further to points 5 and 6 in my letter of 29 October 2025 concerning the Lanseria Airport Holdings and FlySafair matters, the UDM recommends that SCOF pose the following questions to PIC: 7.1. Management fees 7.1.1. Would you state, for the record, the total management fees Harith has drawn from PAIDF I, PAIDF II, and the newly constituted Harith Infraco? 7.1.2. Can you provide a detailed breakdown of those fees by fund, year, and category? 7.2. Fund performance 7.2.1. Provide a comprehensive summary of the financial and operational performance of PAIDF I and PAIDF II. 7.2.2. What were the key value drivers, impairments, exits, and realised or unrealised returns associated with each fund? 7.3. Value created for pensioners 7.3.1. Based on your own reporting and audited figures, how much net value, after all fees, costs, and adjustments i.e. have these funds generated for South African pensioners? 7.3.2. Are you able to confirm whether the net contribution has been positive, neutral, or negative? 7.4. Restructuring and recapitalisation 7.4.1. Harith has recently undertaken what appears to be restructuring, recapitalisation, and redesign of its funds. 7.4.2. Would you explain the commercial rationale for each of these steps? 7.4.3. What direct impact did these actions have on the value of the underlying investments and, specifically, on the stake ultimately attributable to the GEPF? 7.5. Harith Infraco participation 7.5.1. In the newly established Harith Infraco, what is the direct interest, shareholding percentage, or participation in returns attributable to the GEPF? 7.5.2. Has this position changed in any way compared to the GEPF’s prior participation in PAIDF I or II? 7.6. PCV creation and GEPF impact 7.6.1. Regarding the creation of the PCV, could you confirm whether the GEPF incurred any losses, impairments, write-downs, or adverse valuation adjustments from a pure accounting or profitability standpoint? 7.6.2. If so, please detail the amounts and their basis. 7.7. DBSA involvement 7.7.1. Was the DBSA at any stage an investor, lender, or creditor to any Harith-managed fund or to any of the portfolio companies within those funds? 7.7.2. If yes, please specify the nature and quantum of that exposure. 7.8. Pending applications for funding 7.8.1. Does Harith currently have any pending applications and whether for funding, refinancing, restructuring, or borrowing, before the PIC or GEPF? 7.8.2. If so, would you kindly identify each application and indicate its current status? 8. The Thabiso Moshikara scandal in July 2025 8.1. Further I point to 7.3 in my letter of 29 October 2025, regarding the above the UDM would suggest that SCOF ask the following questions of the PIC based further on “Levoca reaffirms its commitment to ethical business practices and remains committed to connecting our communities with fast internet access and bridging the digital divide in South Africa” 8.1.1. The Metrofibre Investment Funding of Levoca was stated in the Annual Financial Report of 2024 of the GEPF as having profited the PIC/GEPF just over R100 million in the span of one year. Why was this deal cancelled, and why were the shares seized for the alleged R1,170.00 postage and stamp fees of Bowmans Attorneys on a deal worth over R1.4 billion? 8.1.2. A case of fraud and corruption has been opened against PIC Head of Legal Lindiwe Masina Dlamini on 07 August 2025, under case number 2025-08-07 at MIDRAND Station, reference number CAS 205/8/2025, by a PIC 8.1.3. whistleblower. The case has now been referred to the Hawks. Why has she not been suspended if Mr Thabiso Moshikara was suspended under the same circumstances? 8.1.4. Who in the PIC authorised the granting of a R1.4 billion legal indemnity to the privately owned company Metrofibre against another private company, Levoca 805, in pursuit of trying to recoup a mere R1,170.00 following the R3 million bribe allegations? 8.1.5. Is this not biased and proof that Levoca was being punished for not wanting to pay Mr Moshikara the R3 million bribe? 8.1.6. It is stated in a civil matter paper between PIC and Levoca 805 that the R1,170 invoice was erroneous or fraudulently issued, which supports the fact that the PIC is lacking a legitimate trigger event. Furthermore, the R1,170 was eventually settled by Levoca, yet the PIC still proceeded to seize Levoca’s shares worth R1.4 billion for R1,170. Why is the PIC still proceeding to seize the shares even after the R1,170, which it relied upon, was settled by Levoca, particularly in an investment that is profiting our government pensioners over R100 million per annum? 8.1.7. What is the current status of this matter? Where does it stand now? Have the shares been returned to Levoca, and if not, why not? 8.1.8. Is the PIC attempting to punish the whistleblower by seizing Levoca’s shares for R1,170? 8.1.9. Does this not sound like corrupt, prejudicial, and oppressive conduct to unlawfully seize Levoca's shares by the PIC as a result of Levoca refusing to pay a R3 million bribe to Mr Moshikara, Head of the Isibaya Fund at the PIC? 9. The Isibaya Fund 9.1. The Isibaya Fund continues to be the centre of corruption within the PIC. Despite the clear warnings of the Mpati Commission, no meaningful reforms have been implemented. This unlisted investment portfolio still operates with poor oversight, secretive decision-making, and transactions that favour politically connected individuals. 9.2. Ultimately, the people who have dedicated their careers to public service are not the true beneficiaries of this fund. It has effectively become a pool of capital reserved for a privileged few, often distributed without proper risk evaluation, exposing the PIC to substantial financial losses and betraying the trust of millions of workers whose pensions are at stake. 9.3. A credit loss ratio exceeding 39% is indefensible and reflects an alarming level of financial mismanagement. No credible institution would tolerate such extensive losses under the guise of economic empowerment. 9.4. Complex financial structures and contractual arrangements have been deliberately used to conceal the extent of this looting. Few fully understand the intricate deal-making mechanisms that enable it, but it is clear that something even more insidious than State Capture continues to thrive within the PIC. 9.5. Given persistent governance failures, it is essential to ask whether the Isibaya Fund should remain under the control of the PIC at all. A more prudent course would be to transfer its developmental and impact investment mandate to institutions with proven governance systems and sectoral expertise, such as the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC). These entities are far better placed to ensure sound project evaluation, transparency, and accountability. The PIC’s role could then be confined to allocating funds under DBSA or IDC supervision, or outsourcing mandates to qualified independent managers operating under strict risk and performance controls. Unless this reform is undertaken, corruption and instability will persist, and no commission of inquiry will be able to restore confidence or integrity to the system. 10. The UDM reiterates its firm belief that safeguarding public pension funds is a matter of national priority. Urgent intervention is required to ensure that the Public Investment Corporation is never exploited as an instrument of political patronage, and that the more than R3 trillion in assets under its management are administered with the utmost integrity, professionalism, and accountability. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: • Mr Matamela Cyril Ramaphosa – President of the Republic of South Africa • Mr Enoch Godongwana, MP - Minister of Finance • Dr David Masondo, MP - Deputy Minister of Finance and Chairperson of the Board of the Public Investment Corporation • Ms Thoko Didiza, MP - Speaker of the National Assembly of South Africa • Mr Songezo Zibi, MP - Chairperson of the Standing Committee on Public Accounts • Mr Patrick Dlamini - Chief Executive Officer, Public Investment Corporation • Mr Musa Mabesa - Principal Executive Officer, Government Employees Pension Fund • Ms Tsakani Maluleke - Auditor-General of South Africa • Adv Andy Mothibi - Head of the Special Investigating Unit • Mr Eric Mabuza – Mabuza Attorneys • Mr Nqabayomzi Kwankwa, MP -UDM Deputy President and Leader in Parliament • Ms Thandi Nontenja, MP – UDM Chief Whip in the National Assembly and Member of the Standing Committee on Public Accounts
Admin
10 Nov, 2025
Report back: R3.5 trillion at risk: the Public Investment Corporation’s governance collapse in the Lanseria Airport Holdings deal and other governance issues
Mr Nqabayomzi Kwankwa, MP UDM Deputy President and Leader in Parliament PO Box 15 Cape Town 8000 and Ms Thandi Nontenja, MP UDM National Treasurer and Chief Whip in the National Assembly Member of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Mr Kwankwa and Ms Nontenja Report back: R3.5 trillion at risk: the Public Investment Corporation’s governance collapse in the Lanseria Airport Holdings deal and other governance issues 1. I hereby request that you prepare the United Democratic Movement’s (UDM) parliamentary operations to address the issues outlined in this letter, with particular focus on the Party’s participation in the Standing Committee on Public Accounts (SCOPA) and the Standing Committee on Finance, and to begin gathering relevant information. I have already instructed Attorney Eric Mabuza of Mabuza Attorneys to obtain key information from Mr Patrick Dlamini, Chief Executive Officer of the Public Investment Corporation (PIC), as reflected in the attached correspondence. 2. On 29 October 2025, the UDM addressed a detailed letter to the President of the Republic, Mr Cyril Ramaphosa, and the SCOPA Chairperson, Mr Songezo Zibi, MP, under the subject “R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action.” In that correspondence, I highlighted the grave risks posed by a series of recent and questionable transactions undertaken by the PIC, which endanger more than R3.5 trillion in pensioners’ funds, alongside widespread governance, ethical, and oversight failures within the institution. As you are aware, the UDM has already proposed several urgent interventions in that letter to address these systemic failures. 3. On 5 November 2025, the PIC Corporate Affairs Division, in the name of the PIC Board Chairperson and Deputy Minister of Finance, Dr David Masondo, issued a statement appeared designed to undermine the UDM’s position. 4. As a matter of interest, Deputy Minister Masondo contacted me, on the same day, personally after the statement was issued, distancing himself from its content and expressing concern about the manner in which the PIC had treated me. It appears that the statement was drafted within the PIC as a deliberate smokescreen and an attempt to deflect public attention from the Lanseria Airport Holdings deal by going on the offensive. Yet, in doing so, the PIC conceded that “…a legal review on the arbitration proceedings is underway…,” which only reinforces the view that where there is smoke, there is indeed fire. Why attack the UDM and me personally instead of providing a substantive response to each of the issues we raised in our letter of 29 October 2025? 5. On 8 November 2025, I again wrote to President Ramaphosa and SCOPA Chairperson Songezo Zibi, specifically concerning: 5.1. A letter from Werksmans Attorneys to Mabotja Attorneys titled: “PUBLIC INVESTMENT CORPORATION SOC LIMITED // ACAPULCO TRADE AND INVEST 164(RF) (PTY) LTD” dated 6 November 2025 and 5.2. Mabotja Attorneys’ response to the above entitled.: “LANSERIA AND RELATED MATTERS” of 7 November 2025. 5.3. In its correspondence, Werksmans Attorneys, acting on behalf of the PIC, wrote to Mabotja Attorneys, who represent Acapulco Trade and Invest 164 (Pty) Ltd, concerning the aftermath of an arbitration award in favour of Acapulco dated 17 September 2025, amounting to R411 282 264.44. The letter indicates that the PIC intends to review or challenge the award and has requested that the funds already deposited in Mabotja Attorneys’ trust account be frozen pending the outcome of that review. 5.4. In reply, Mabotja Attorneys issued a strongly worded and defensive response aimed at discrediting Werksmans Attorneys’ letter on behalf of the PIC and portraying Acapulco as the aggrieved party. The exchange highlights growing tension between Acapulco, Mr Patrick Dlamini, and Harith General Partners and its founder, Mr Tshepo Mahloele, who appears to be a key figure at the centre of the dispute. 6. What prompted Mr Dlamini to act so suddenly? Was it his own initiative, or did the PIC Board finally intervene in a last-minute attempt to salvage what remains of the institution’s credibility and reputation? 7. There appears to be a significant fallout between the PIC and Acapulco Trade and Invest 164 (Pty) Ltd, the BEE partner in the Lanseria Airport Holdings deal. Despite Acapulco having defaulted on a R333 million loan, which grew to approximately R600 million with interest, the PIC nevertheless proceeded to pay just over R411 million to Acapulco after an arbitration process upheld a contested valuation conducted by Crowe, a so-called external valuer. This payout has reportedly angered the PIC Board, which has since moved to freeze the funds and is said to be considering legal action. These developments point to growing internal discord within the PIC and raise serious concerns about a potential governance collapse within the institution. Why did the Mr Dlamini and his executive team approve this transaction in the first place if they are now raising alarm after the fact? 8. Mr Dlamini’s professional history continues to raise serious governance concerns. In Mabotja Attorneys’ letter of 7 November 2025, it is alleged that he has maintained a close personal and professional relationship with Mr Mahloele and Harith General Partners, including attending a celebratory gathering at Mr Mahloele’s Bryanston home shortly after his appointment as PIC CEO. This allegation adds to a pattern first documented during his tenure as CEO of the Development Bank of Southern Africa, when serious accusations of mismanagement, maladministration and possible corruption the UDM brought to the attention of SCOPA in October 2020. At that time, concerns were raised about his association with Mr Mahloele and Harith, particularly around the Poseidon funding matter and other questionable transactions that appeared to benefit politically connected entities. Now, as head of the PIC, the same allegations of conflict of interest, irregular investment decisions and weak governance have resurfaced, most notably in the Lanseria Airport Holdings and FlySafair dealings involving Harith-linked interests. This recurring pattern points to an entrenched network of influence between public finance institutions and private business interests that requires urgent and independent investigation. 9. In its letter of 29 October 2025, the UDM made two key recommendations: 9.1. That SCOPA convene urgent public hearings with the PIC Board, the Chief Executive Officer, and the Government Employees Pension Fund (GEPF) to account for ongoing governance failures, ethical breaches, and poor investment decisions. 9.2. That the Auditor-General and the Special Investigating Unit (SIU) conduct a forensic audit of the Isibaya Fund and the Unlisted Investments Division, with a particular focus on politically connected transactions, loss-making projects, and compliance with the recommendations of the Mpati Commission. The Lanseria transaction, which was initiated in 2013, must be included in the scope of investigation as this appears to be where the shenanigans first began. Questions remain about the servicing of the loan through dividends. Were any ever declared by the Government Employees Pension Fund, the PIC, Acapulco, or Harith General Partners? 10. Equally concerning is the reported involvement of Harith General Partners in raising funds to acquire a stake in FlySafair. It is important to recall that the UDM previously intervened to stop the South African Airways (SAA) transaction after informing President Ramaphosa and then Minister of Public Enterprises Pravin Gordhan, following Gordhan’s 11 June 2021 announcement that the Takatso Consortium, led in part by Harith General Partners owned by Mr Tshepo Mahloele, had been selected as the preferred bidder to acquire a 51% stake in SAA for R51. 11. A further and deeply troubling conflict of interest arises from the fact that Mr Dlamini previously served as Chairperson of the Lanseria Airport Holdings Board while simultaneously holding senior public office. According to the Companies and Intellectual Property Commission (CIPC) website, he still remains listed as a Non-Executive Director of Lanseria Holdings (K2012204048), Lanseria Airport 1993 (M1993004101), Lanseria Airport Investments (M2002025907) and Lanseria International Airport (M1991001749). His continued association with these entities, which have direct financial dealings with the PIC, raises serious questions about the independence and propriety of decisions taken under his leadership. This dual involvement suggests that Mr Dlamini may have had access to privileged information regarding the airport’s operations and valuation, both before and after the disputed PIC investment. When considered alongside the issues raised in Mabotja Attorneys’ letter concerning his relationship with Harith General Partners and its founder, Mr Tshepo Mahloele, this overlap of roles points to a possible conflict of interest that warrants urgent scrutiny by the relevant oversight bodies. Now, the same players appear to be seeking to use public funds for private investment ventures. We have not forgotten the Mpati Commission’s damning findings against these entities. 12. The Auditor-General, acting under the auspices of SCOPA, remains the only credible authority capable of conducting a comprehensive review of the Lanseria deal and related transactions, given that public money is once again at stake. 13. The UDM should maintain its position that safeguarding public pension funds is a matter of national importance. It is imperative that decisive intervention takes place to ensure the PIC is never exploited as a vehicle for political patronage, and that the more than R3 trillion in assets under its management are administered with the highest levels of integrity, professionalism, and accountability. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: • Mr Matamela Cyril Ramaphosa – President of the Republic of South Africa • Mr Enoch Godongwana, MP - Minister of Finance • Dr David Masondo, MP - Deputy Minister of Finance and Chairperson of the Board of the Public Investment Corporation • Ms Thoko Didiza, MP - Speaker of the National Assembly of South Africa • Mr Songezo Zibi, MP - Chairperson of the Standing Committee on Public Accounts • Dr Mkhacani Maswanganyi, MP - Chairperson of the Standing Committee on Finance • Mr Patrick Dlamini - Chief Executive Officer, Public Investment Corporation • Mr Musa Mabesa - Principal Executive Officer, Government Employees Pension Fund • Ms Tsakani Maluleke - Auditor-General of South Africa • Adv Andy Mothibi - Head of the Special Investigating Unit • Mr Eric Mabuza – Mabuza Attorneys
Admin
08 Nov, 2025
Renewed concerns over probable governance irregularities and conflicts of interest at the Public Investment Corporation: the PIC’s confused(ing) rhetoric regarding the Lanseria and FlySafair deals
Mr MC Ramaphosa President of the Republic of South Africa Private Bag X1000 Pretoria 0001 and Mr Songezo Zibi, MP Chairperson of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Mister President and Chairperson Zibi Renewed concerns over probable governance irregularities and conflicts of interest at the Public Investment Corporation: the PIC’s confused(ing) rhetoric regarding the Lanseria and FlySafair deals 1. I refer to my correspondence dated 29 October 2025, titled “R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action.” In that letter, I outlined the serious risks arising from several recent and questionable transactions undertaken by the Public Investment Corporation (PIC), which place over R3.5 trillion in pensioners’ funds in jeopardy, as well as broader governance and ethical failures within the institution. 2. “The PIC’s records in respect of Harith’s (or a party related to Harith) application/request for funding to acquire all or portion of the shares in FlySafair, directly or indirectly.” This is a direct quote from the letter referred to in Paragraph 4.2, wherein the PIC is asked to preserve “records, minutes, notes, guest lists, recordings and resolutions and/or other material” relating to Harith General Partners’ acquisition of shares in FlySafair. One must ask: who is fooling whom? 3. On 5 November 2025, the PIC Board Chairperson and Deputy Minister of Finance, Dr David Masondo, launched a scathing and aggressive attack on me personally and made a weak attempt to tarnish my reputation, question my credentials, and cast aspersions on the information the UDM provided in its letter of 29 October 2025. In this regard, I wish to make the following observations: 3.1. While the PIC provides impressive financial statistics, it fails to meaningfully address the core governance concerns raised by the UDM, namely valuation manipulation, political interference, and weak board oversight. 3.2. The PIC attempts to project transparency by citing asset growth and external audits yet simultaneously hides behind claims of legal confidentiality in the Lanseria Holdings matter. This contradiction severely undermines its credibility. 3.3. Although claiming to respect Parliament, the PIC’s statement labels a Member of Parliament’s formal correspondence as “nefarious i.e. language that may be interpreted as contemptuous of democratic oversight and to which I take strong personal exception. 3.4. Furthermore, while denying wrongdoing, the PIC’s statement acknowledges that a review of the arbitration proceedings is underway, implicitly conceding that there may indeed be irregularities in the transaction. This is clearly evidenced by the correspondence referred to in Paragraph 4.14.1, which confirms that the matter remains under internal scrutiny. Yet, instead of welcoming the alert and taking proactive corrective measures, the PIC chose to attack me personally, rather than expressing gratitude for having brought this concerning deal to its attention. 3.5. Why issue the statement in the first place? The PIC went to great lengths to adopt a defensive posture, using offensive language directed at me, while at the same time conceding through its own actions that there is indeed something fishy about the Lanseria transaction. 4. To provide further context to this entire matter, I have attached two pieces of critical correspondence which demonstrate that Dr Masondo, in the name of the PIC, “doth protest too much”: 4.1. A letter from Werksmans Attorneys to Mabotja Attorneys titled: “PUBLIC INVESTMENT CORPORATION SOC LIMITED // ACAPULCO TRADE AND INVEST 164(RF) (PTY) LTD” dated 6 November 2025. 4.2. Mabotja Attorneys’ response to the above entitled.: “LANSERIA AND RELATED MATTERS” of 7 November 2025. 4.3. Werksmans Attorneys, acting on behalf of the PIC, addressed a letter to Mabotja Attorneys, who represent Acapulco Trade and Invest 164 (Pty) Ltd, regarding the aftermath of an arbitration award in favour of Acapulco, dated 17 September 2025 in the amount of R411 282 264.44. The correspondence indicates that the PIC intends to review or challenge the arbitration award and seeks to freeze the funds already deposited in Mabotja Attorneys’ trust account pending the outcome of that review. 4.4. In response, Mabotja Attorneys issued a combative and defensive reply, aimed at discrediting Werksmans Attorneys’ correspondence on behalf of the PIC and portraying Acapulco as the aggrieved party. The exchange suggests escalating tension between Acapulco and the PIC, its Chief Executive Officer (CEO), Mr Patrick Dlamini, as well as Harith General Partners and its founder, Mr Mahloele, who appears to be a central figure of contention. 4.5. The revelation that Mr Mahloele hosted a “celebratory gathering” in Bryanston to mark Mr Dlamini’s appointment as PIC CEO is particularly concerning in the broader context of potential conflicts of interest and governance integrity within the PIC. 5. Clearly, the Lanseria transaction and the PIC’s dealings in the FlySafair matter, both linked to Mr Tshepo Mahloele, appear increasingly suspect in light of the aforementioned context. The Lanseria deal has been unfolding for over twelve years, and it is now imperative that SCOPA asks even more probing questions than it did before my letter of 29 October 2025. 6. The key question for the UDM therefore remains: how many other transactions of this nature the PIC has entered into, in violation of its own governance protocols, and in the process placing at risk the R3.5 trillion in pensioners’ funds managed through the Government Employees Pension Fund (GEPF), notwithstanding Dr Masondo’s protestations to the contrary. 7. Ultimately, the PIC is a state-owned enterprise, and Parliamentary oversight is a cornerstone of ensuring that such institutions are managed ethically and transparently. Yet, the PIC appears determined to avoid public scrutiny and to continue operating in secrecy, contrary to the principles of accountability and public trust. 8. The UDM reiterates that the protection of public pension funds is a matter of national importance. Urgent intervention is required to ensure that the PIC is not used as a vehicle for political patronage and that the R3.5 trillion in assets under its management are handled with the highest standards of integrity, professionalism, and accountability. 9. We are in for a jolly period, to say the least, consider this my early Christmas gift to the public. The truth is finally coming to light. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: • Mr Enoch Godongwana, MP - Minister of Finance • Dr David Masondo, MP - Deputy Minister of Finance and Chairperson of the Board of the Public Investment Corporation • Ms Thoko Didiza, MP - Speaker of the National Assembly of South Africa • Mr Patrick Dlamini - Chief Executive Officer, Public Investment Corporation • Mr Musa Mabesa - Principal Executive Officer, Government Employees Pension Fund • Ms Tsakani Maluleke - Auditor-General of South Africa • Adv Andy Mothibi - Head of the Special Investigating Unit
Admin
30 Oct, 2025
Formal clarification and representation in respect of the Lanseria Holdings (PTY) Ltd transaction
Mr KG Mabotja Mabotja Attorneys 189 Lunnon Road Hillcrest Office Park Barbet Place Hillcrest Pretoria 0083 Dear Sir Formal clarification and representation in respect of the Lanseria Holdings (PTY) Ltd transaction 1. I note your client’s position; however, the explanations provided raise several further questions that require documentary verification before any of the assertions can be accepted at face value. 2. You state that the valuation in question was performed by an independent audit firm and a professional property valuer jointly appointed by the Public Investment Corporation (PIC) and Acapulco. Please confirm whether the external audit firm and the property valuer were selected from the Public Investment Corporation’s panel of accredited external valuers, and, if so, provide documentary evidence of their accreditation and appointment process. The independence of the valuer is a material consideration, as valuations of this nature are vulnerable to manipulation if not conducted by duly accredited professionals who have undergone an approved appointment process by the PIC. Kindly also provide: 2.1. The full valuation report and supporting schedules; 2.2. The name of the audit firm and confirmation of whether it is one of the recognised Big Four or Five audit firms (Deloitte, PwC, EY, KPMG, or BDO). 2.3. As you will appreciate, financial institutions and institutional investors typically rely on the work of internationally recognised audit and valuation firms to ensure independence and credibility. The integrity of the valuation process depends on this standard. 3. It has been noted that the Government Employees Pension Fund (GEPF) continues to hold the same Lanseria asset at an impaired value, despite the revaluation you reference. 3.1. How does your client explain this discrepancy? 3.2. Are you suggesting that the GEPF valuation is incorrect? 3.3. If not, please clarify how two entities, both ultimately representing the same shareholder interest, can hold materially divergent valuations for the same asset. 4. If the valuation truly reflected a higher fair value, why did neither the PIC nor your client initiate a market sale of the asset to test and realise that value? 4.1. A sale to a bona fide third party would have provided the only objective confirmation of the claimed valuation and would have allowed the repayment of the outstanding loan from real, realised proceeds. 4.2. The decision to effect payments without such a sale raises legitimate questions about potential collusion between PIC representatives and BEE partners, to the detriment of the GEPF and the pensioners whose funds are at risk. 5. You confirm that repayment of the loan was linked to dividend flows. Once those dividends failed to materialise, the loan should have been declared in default and the PIC should have executed against the security, in this case, the shares held by Acapulco, until recovery was completed. 5.1. On what basis, therefore, were payments made to Acapulco before any such sale took place? 5.2. Please provide documentation or correspondence showing the PIC’s authorisation for these payments. 6. In light of your client’s assurance that all valuations, arbitration records, and transaction documents are available for inspection, I hereby formally request copies of these documents for review. Kindly provide the complete valuation report, arbitration award, loan and shareholder agreements, and any other records relevant to the Lanseria Holdings transaction. These documents are essential to substantiate your client’s representations and to enable informed oversight and accountability in the public interest. 7. Would you kindly direct future correspondence to my attorney, Mr Eric Mabuza, at Mabuza Attorneys at Eric@mabuzas.co.za. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: Mr Eric Mabuza, Mabuza Attorneys
Admin
29 Oct, 2025
R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action
Mr MC Ramaphosa President of the Republic of South Africa Private Bag X1000 Pretoria 0001 and Mr Songezo Zibi, MP Chairperson of the Standing Committee on Public Accounts PO Box 15 Cape Town 8000 Dear Mister President and Chairperson Zibi R3.5 trillion at risk: the Public Investment Corporation’s governance collapse demands action 1. I had the privilege of attending the extended Cabinet Lekgotla at the end of September 2025, where you, Mr President, emphasised that the fight against corruption and the looting of state resources would be a top priority for the Government of National Unity. You further noted that the current climate of corruption and mismanagement has severely undermined investor confidence, and that this situation must be decisively addressed. 2. The Judicial Commission of Inquiry into Allegations of Impropriety at the Public Investment Corporation (PIC) (‘the Mpati Commission’) was established by you, Mr President, in October 2018 to investigate allegations of corruption, maladministration, and governance failures at the PIC, Africa’s largest asset manager, overseeing pension and social funds exceeding R2 trillion at the time (now over R3.5 trillion). 3. Amongst others, the Mpati Commission in 2020 exposed the PIC as a politically captured institution plagued by poor governance, weak accountability, and corruption, particularly within its unlisted investment portfolio (Isibaya Fund). Its recommendations aimed to restore transparency and fiduciary responsibility, but implementation has been slow and inconsistent. 4. Instead, what the United Democratic Movement (UDM) presents hereunder is a stark picture of continued looting, mismanagement, and administrative bungling from top to bottom at the PIC and its Isibaya Fund since the conclusion of the Mpati Commission, a situation of enormous proportions that rivals the State Capture scandal itself. This does not require another commission of inquiry. Rather, the UDM sets out below a series of concrete proposals for decisive action to stop the rot in its tracks through innovative solutions, strengthened parliamentary oversight, and firm law enforcement intervention. 5. The Lanseria Airport Holdings case 5.1. This presents what appears to be brazen looting of PIC funds, arguably worse than anything uncovered by the Mpati Commission. Around 2013, Harith General Partners, a group of BEE partners, and the Government Employees Pension Fund (GEPF) invested in Lanseria Airport. The BEE partner, Acapulco Trade and Invest, was fully funded by the PIC with a loan of about R350 million, to be repaid from future dividends. More than a decade later, the loan remains unpaid and has ballooned to over R600 million, leaving the investment deeply underwater. Instead of writing it off, the PIC and its BEE partner conjured a revaluation, declaring the asset suddenly worth R1 billion. 5.2. The PIC then took over the BEE partner’s shares as security and astonishingly concluded that it now owed the BEE partner R400 million. In other words, a failed investment was transformed on paper into a profit for the debtor, creating R400 million of value out of thin air. From a debt of R600 million with no repayment capacity, the BEE partner miraculously walked away with a R400 million windfall (the BEE shareholders got their share this month and they are allegedly fighting over the loot). This may be one of the most blatant acts of looting in PIC history, rivalling the excesses of the Dr Dan Matjila era. 5.3. To make matters worse, the GEPF itself already holds an impaired stake in Lanseria Holdings. This means the PIC will either have to immediately write off the shares it took over or get the GEPF to revalue the shares to avoid scrutiny. You cannot hold same shares on the same balance sheet at different valuations. 6. The “New Karan Beef” and FlySafair deals 6.1. In 2019, the PIC was forced to halt its planned investment in Karan Beef after a whistleblower exposed alleged price inflation that pushed the valuation to R5.2 billion. Despite prior approval, the deal was never implemented following the Mpati Commission’s intervention. 6.2. Now, a similar pattern appears to be emerging with FlySafair. The airline is seeking local investors after regulatory rulings on ownership, and it is alleged that a consortium is attempting to acquire it with PIC funding at an inflated valuation of about R7.9 billion; nearly double the estimated fair value. If executed, the transaction could result in massive value destruction, mirroring what would have happened with Karan Beef. 6.3. While FlySafair is a strong airline, it is certainly not worth more than R3.9 billion. The airline industry remains highly volatile, and history shows that even leading carriers can collapse within years. Yet again, just as in the Lanseria Airport and other controversial transactions, Harith General Partners (linked to Mr Tshepo Mahloele) appears to be involved. This deal is currently being hotly debated within the financial services sector. No approvals yet. Just like Karan Beef, there is a push to extract billions from the PIC, and as always write-offs will follow soon afterwards. 7. The latest scandals in the public domain 7.1. The latest developments at the PIC reveal a deepening power struggle within the institution, exposing how political factionalism continues to undermine its governance. 7.2. The suspension of Chief Investment Officer Kabelo Rikhotso in early October 2025, officially framed as part of a misconduct investigation, has reportedly triggered internal tensions between rival camps competing for control of the corporation’s investment machinery . According to insider accounts, the battle is not merely administrative but linked to political influence over access to capital and deal-flow. The episode underscores a worrying pattern: instead of operating as an independent and professionally managed custodian of more than R3.5 trillion in public servants’ pension assets, the PIC has again become a stage for self enrichment. This climate of uncertainty and factional interference threatens both investor confidence and the fiduciary security of millions of pensioners who depend on the integrity of the institution. 7.3. In July 2025, the Thabiso Moshikara scandal reignited concerns about governance at the PIC. Moshikara, acting head of the PIC’s Unlisted Investments division, was accused of demanding a R3 million bribe from businessman Ralebala Mampeule, whose company Levoca 804 had received R693 million in PIC funding to buy a stake in Metrofibre Network. Mr Mampeule claimed that after the investment soured, Mr Moshikara allegedly threatened to cut off funding unless he paid the bribe, leading to a criminal investigation for extortion and Mr Moshikara’s suspension in October 2025. The case, which erupted in the same period as other senior-level suspensions, has deepened divisions within the PIC and underscores how the Isibaya Fund, long criticised by the Mpati Commission for weak oversight and political interference, remains a focal point of instability in an institution managing over R3.5 trillion in public funds. 8. Investment losses and governance problems: the Daybreak Foods case 8.1. Daybreak Foods, once presented as a flagship black-empowerment investment, has become one of the most visible symbols of the PIC’s governance and oversight failures. Despite repeated warnings from the Mpati Commission about weaknesses in the unlisted portfolio, the PIC has continued to pour money into the struggling poultry company. In July 2025, the PIC injected a further R150 million into Daybreak, bringing its total exposure this year to about R400 million and total investment since 2015 to approximately R1.7 billion. The company entered business rescue in May 2025, following years of losses, poor governance, and operational mismanagement. The PIC’s decision to provide additional funding to a failing enterprise under these circumstances underscores the absence of effective oversight, proper risk assessment, and consequence management within its unlisted investments. 8.2. Observers note that, while the PIC claims to have implemented the Mpati Commission’s recommendations, its continued support of non-performing and poorly governed entities such as Daybreak Foods demonstrates that the underlying accountability mechanisms remain weak, opaque, and easily influenced. 9. Even after the Mpati Commission, corruption within the PIC appears deeply entrenched. The institution is increasingly viewed as ground zero for corruption in South Africa, with billions of rand lost through reckless investments and outright misconduct. The PIC manages over R3.5 trillion in pension funds on behalf of public servants, yet the scale of governance and oversight remains alarmingly weak. 10. The current PIC board appears unfit for purpose 10.1. Compared to boards of other major financial-sector entities, including even struggling state-owned enterprises like Eskom, the contrast is stark. It is deeply concerning that a fund managing R3.5 trillion in pensioners’ savings operates under such a fragile governance structure. This persistent instability raises serious questions: is it the result of oversight failures, or a deliberate design to enable political capture rather than protect public assets? 10.2. It is alleged that the board is struggling to constitute key subcommittees, such as the audit committee, due to a lack of people with the minimum required qualifications, i.e. chartered accountant expertise. 10.3. Furthermore, the board lacks sufficient investment experience to form a credible investment committee. At present, there is reportedly no one with appropriate investment credentials serving on the board. Of particular concern is the Minister of Finance’s recent appointment of the wrong individual, one Mr Maseko, to the board. This bizarre error raises further questions: was it a genuine mistake, or was the Minister misled into making the appointment? Either scenario reflects poorly on the integrity and diligence of the appointment process. 11. Involvement of the banks 11.1. Some of the top South African banks have been involved in advising the PIC to participate in many transactions that exposes the PIC to reckless investment dealing, while at the same time participating in the more secured portion of the deals. These top banks need to be held accountable for their role in value destruction. They hide behind the so-called Chinese Walls. There is one bank that has been more prominent in the deals involving the PIC/GEPF. Both as an advisor and a participant in the more secured portion. 12. Investigation into the government pensions Regarding the matter of the former SATBVC pensioners, which I raised during the State of the Nation Address debate on 14 February 2023, I wish to reiterate my concern that no progress has been made. At the time, you, Mr President, directed the Minister of Finance, Mr Enoch Godongwana, to establish a team to investigate the pension entitlements of civil servants from the former SATBVC states. You further tasked the Deputy President, as head of the task team on the benefits of military veterans, to provide you with a report on this matter. To date, however, no such report has been produced, and the affected pensioners continue to wait in uncertainty. 13. The Isibaya Fund remains the epicentre of corruption within the PIC. Despite the Mpati Commission’s warnings, little has changed. This unlisted investment portfolio continues to operate with weak oversight, opaque decision-making, and politically connected deal flows. It functions as a pot of money selectively accessed by a privileged few, often without proper risk assessment, leaving the PIC exposed to massive losses. The loss ratios are unacceptable by any commercial or development finance standard. 14. The credit loss ratios of over 39% is purely criminal, no credible institution will allow such level of brazen looting in the name of empowerment. Ultimately, the State and South African public are the real losers given that PIC is guaranteed by the National Treasury. The scale of looting rivals the Gupta’s State Capture, the amount at risk is over R170 billion. The sophistication of the financial engineering and contracts are used to hide the brazen looting. Many people hardly understand deal structuring. South Africa needs to know that something worse than the State Capture continues to thrive at the PIC. 15. Given these persistent failures, it is time to ask difficult questions: Why should the Isibaya Fund remain under the PIC’s control at all? A more sensible approach would be to transfer its developmental and impact investment mandate to institutions better equipped for that purpose, such as the Development Bank of Southern Africa (DBSA) or the Industrial Development Corporation (IDC), where project evaluation, governance, and sectoral expertise are stronger. The PIC’s role could then be limited to allocating funds under DBSA or IDC supervision, or outsourcing mandates to independent professional managers with clear risk controls and accountability mechanisms. The looting will continue as long as the fund remains under the PIC. The instability will never stop; and no commission can fix that. 16. Isibaya Fund at R175 billion (at 5% of total AUM 3.5 trillion) can be transformative for South Africa if applied prudently for development purpose as defined in the mandate. Currently the fund is yielding negative returns. Based on the above number and high credit loss ratios, up to R70 billion is provided for ultimate write offs; clear wastage, with minimal development impact except narrow enrichment of a select few. 17. Working at Isibaya or the PIC has, regrettably, become increasingly viewed as career suicide. What should have been an exceptional training ground for Black investment talent, a place to hone technical, ethical, and leadership capabilities, has instead become a graveyard for many promising careers. It is virtually impossible to attract top talent with the reputation that the Fund has; the inability to attract top talent makes it difficult to do good investments. 18. The United Democratic Movement herewith recommends that: 18.1. SCOPA convenes urgent public hearings with the PIC Board, the Chief Executive Officer, and the Government Employees Pension Fund to account for ongoing governance failures, ethical breaches, and poor investment decisions. 18.2. The Auditor-General and the Special Investigating Unit to conduct a forensic audit of the Isibaya Fund and the Unlisted Investments Division, focusing on politically connected deals, loss-making projects, and compliance with the Mpati Commission’s recommendations. 18.3. National Treasury to review the composition, competence, and independence of the current PIC Board, with a view to strengthening governance and reducing political interference. 18.4. The Minister of Finance to present to Parliament a status report on the implementation of the Mpati Commission’s findings and recommendations, indicating which reforms have been completed, delayed, or abandoned. 18.5. The Minister of Finance commission a feasibility study on the transfer of the PIC’s developmental and impact investment mandate to institutions such as the DBSA or the IDC and report the findings to Parliament within a defined timeframe. 18.6. All deals under the Isibaya Fund should be reported on their website on a quarterly basis, showing the full details of the transaction, with no exception. Confidentiality cannot trump the transparency required for public funds. Current disclosure is not sufficient at all. Full amount disbursed should be shown, valuations, beneficiaries, impairments, original investment amount and all settlements. Parties not comfortable with disclosure should seek funding from commercial banks. 18.7. Dealmakers at the PIC/Isibaya Fund should be paid based on economic return performance, not disbursement of funds. Once funds are disbursed, the dealmakers do not have “skin in the game”. That should stop. With current return profile (i.e. negative returns), no bonuses should be paid irrespective of funds disbursed, just like in any commercial fund. 18.8. It is imperative that the Isibaya Fund be placed under immediate moratorium to facilitate its transition to a more credible and professionally managed platform, such as the DBSA, the IDC, or an independent third-party investment manager with robust governance frameworks and proven expertise. This decisive action will help stabilise the PIC by eliminating avenues for exploitative and politically motivated investments. 19. The United Democratic Movement believes that the protection of public pension funds is a matter of national importance. Intervention is essential to ensure that the PIC is not used as a vehicle for political patronage and that the R3 trillion in assets it holds are managed with the highest standards of integrity, professionalism, and accountability. Yours sincerely Deputy Minister Bantu Holomisa, MP President of the United Democratic Movement Copied to: • Mr Enoch Godongwana, MP - Minister of Finance • Dr David Masondo, MP - Deputy Minister of Finance and Chairperson of the Board of the Public Investment Corporation • Ms Thoko Didiza, MP - Speaker of the National Assembly of South Africa • Mr Patrick Dlamini - Chief Executive Officer, Public Investment Corporation • Mr Musa Mabesa - Principal Executive Officer, Government Employees Pension Fund • Ms Tsakani Maluleke - Auditor-General of South Africa • Adv Andy Mothibi - Head of the Special Investigating Unit
Admin
13 Jul, 2020
DBSA’s strange treatment of the allegations of corruption regarding the Poseidon water project and its funding
Mr Patrick K Dlamini Chief Executive Officer and Managing Director Development Bank of Southern Africa PO Box 1234 Halfway House 1685 Dear Mr Dlamini Development Bank of Southern Africa’s strange treatment of the allegations of corruption regarding the Poseidon water project and its funding 1. I respond to your letter of 10 July 2020, which the Development Bank of Southern Africa (DBSA) Company Secretary, Ms Bathobile Sowazi, sent at 22:57 on a Friday. Looking back at other emails, after hours correspondence seems to be the norm at the DBSA and one can but speculate as to the reasons why. 2. In all your letters to me regarding the Poseidon water project you sound defensive and blustering regarding the DBSA’s handling of this funding deal. Why would you cover your wickets with such excessive vigour and choose to cast aspersions on my bona fides? 3. You stated that I have “…publicly disclosed confidential information and documents belonging to the DBSA’s clients…”, what I interpret this to mean is that the information at my disposal is true and accurate. You are, in fact, right to be worried that the DBSA’s credibility might be undermined, as it, and/or some of its leadership, are seemingly engaged in activities they do not want exposed. 4. It is interesting that you decided to pre-empt President Ramaphosa’s response to my request for an investigation of the Poseidon deal. Now that you have positioned yourself as the president of this country, will you please tell the nation how the following people, as per your below document, are involved in the Poseidon transaction and how they directly and/or indirectly benefit from this deal. 5. This list of politically exposed persons (PEPs) in Poseidon’s group structure is a veritable Who’s Who of directors of public owned entities. It raises questions about the comprehensiveness and effectiveness of the DBSA’s due diligence processes in terms of corporate governance as defined in the Companies Act, No. 71 of 2008 and its 2011 amendment, the Public Finance Management Act, No. 1 of 1999 and the fourth revision of the King Report on Corporate Governance. 6. Item number 4 of the above document (in the picture), refers to the Public Investment Corporation (PIC) directors who were identified as PEPs in this deal by virtue of being board members of a state-owned entity. Who exactly are these PIC board members your document refers to i.e. the board members at the time of the submission of the application or those at the time of its approval? Either way it would be helpful if you could explain their involvement in this private, for-profit matter and whether the DBSA condones this kind of association. 7. It is confounding that your very own document states that Dr Renosi Mokate is a PEP by virtue of her being a trustee of the Harith Holdings Employee Trust and the board chairperson of the Government Employees Pension Fund (GEPF), yet she made a bare denial of any connection to Poseidon in her submission to the court in her defamation case against me and the United Democratic Movement. So, the questions the public and/or a judge might ask you are: Who added her name to this document, and why? Also, from where did you obtain this information? 8. Ultimately you are to be thanked for confirming the veracity of the above information. We will however ask those individuals (including the GEPF chairperson) who ran to court, to explain why their names appear on a DBSA document pertaining to the Crede Power and Infrastructure Investments/Poseidon funding application. 9. Our letter to the President is clear in terms of what we want to be investigated. Part of that would be that you seemingly misled the DBSA’s board by allegedly recommending that this project be funded despite the above information being at your disposal. Worse still is that some of these PEPs have been fingered in the Commission of inquiry into allegations of impropriety regarding the Public Investment Corporation. Why are you promoting and protecting these people? 10. You have placed on record that “On or about June 2019 the DBSA received an application from Crede Power and Infrastructure Investments…”. Mr Jabu Moleketi left as DBSA Chairperson in December 2018. What these two facts mean is that the Crede Power and Infrastructure Investments/Poseidon funding application was submitted to the DBSA within six months of his having left the DBSA, which I understand is in contravention of the DBSA’s twelve month “cooling off” period for directors who have left the Bank. The public might ask you whether these facts were disclosed to the Board when it considered and approved the funding application? 11. Your artless attempt to threaten me with “the law” where it pertains to whistleblowing, begs the question: “Is it not nice and convenient that the DBSA decision-makers, in the Poseidon water project deal, can hide behind this country’s laws?” This might exactly be the reason why there was no other way of exposing the alleged corruption in the way that we have. 12. The DBSA’s refusal of my Promotion of Access to Information Act 2 of 2000 request, because of technicalities, is utter drivel. You and Ms Kim Sanderson (DBSA Deputy Information Officer) who wrote to me, know exactly to which deal I was referring and what information I had asked for. Such seemingly spiteful delaying tactics could be interpreted as the DBSA playing for time to “cook the books”. If I were in your boots, I would be preparing to explain this mess in court. 13. Your 10 July 2020 letter smacks of a panicked response to being confronted by facts that are not to your and your colleagues’ liking, least of all to the liking of the PEPs involved in Poseidon. 14. I walk away from all your correspondence, thus far, with a very repulsive taste in my mouth and the perturbing feeling that you are not acting in the best interest of the people of this country. Yours sincerely Mr Bantu Holomisa, MP UDM President Copied to: Minister of Finance, Mr Tito Mboweni DBSA Chairperson, Mr Enoch Godongwana DBSA Company Secretary, Ms Bathobile Sowazi DBSA Deputy Information Officer, Ms Kim Sanderson Mabuza Attorneys, Attorney Eric Mabuza
Admin
23 Jun, 2020
DBSA approval of Poseidon water project grant/loan: CEO Sandile Sokhela seems to be economical with the truth
Mr Enoch Godongwana Chairman of the Board of Directors Development Bank of Southern Africa PO Box 1234 Halfway House 1685 Dear Mr Godongwana DBSA APPROVAL OF POSEIDON WATER PROJECT GRANT/LOAN: CEO SANDILE SOKHELA SEEMS TO BE ECONOMICAL WITH THE TRUTH 1. I write to your good office regarding a grant/loan application submitted to the Development Bank of Southern Africa (DBSA) by Poseidon Pty Ltd (‘Poseidon’). 2. According to the information at my disposal, the DBSA had on 26 March 2020 approved funding for Poseidon to the tune of R50 million to conduct feasibility studies, for some kind of water project/s, in South Africa and other Southern African countries. Another R300 million is apparently still to be disbursed for the implementation of Poseidon’s project. 3. In terms of the DBSA’s March approval, Poseidon’s shareholding is as follows: 4. As I understand it, Harith General Partners invested in Crede Power and Infrastructure Investments (‘Crede’) via a capitalisation of R25 million over a four-year period to fund continued operational and other costs. Harith invested in Crede with an objective to capacitate an emerging fund manager that would complement the activities of Harith as a fund manager to the Pan African Infrastructure Development Funds (PAIDF I and II). To date Crede has drawn down R12 million of these funds. 5. My information shows that the DBSA Compliance Unit undertook Politically Exposed Persons (PEPs) checks on Poseidon’s shareholder and group companies and various directors were identified as PEPs by virtue of them being board members of various state-owned entities. Amongst others, the following is identified as a PEP: • Mr Tshepo Mahloele who is a non-executive director in the Crede was identified as a PEP by virtue of him being a former board member of Telkom SA in 2008; his PEP status is inactive as of 2008. Mr Mahloele is the CEO of HGP and sits on Crede’s board. 6. As you are aware, I recently wrote to the President of the Republic (letter attached for your ease of reference) to register my concern over what seems to be another attempt to loot state resources, as had occurred at the Public Investment Corporation, but this time at your organisation, using Poseidon as a vehicle. I had sourced some of my information from their websites, but I have since discovered that both Crede Capital Partners and Crede Power and Infrastructure Investments’ websites (https://credecapital.co.za/ and http://credepower.co.za/ respectively) have been discontinued/are no longer visible. Would one be wrong in surmising that someone is trying to cover their tracks? 7. In particular, during my initial search, Crede Power and Infrastructure Investments’ website proudly shared that Mr Tshepo Mahloele was its director, but I was recently confronted with a letter from Crede/Poseidon’s lawyers (also attached) categorically stating that Mr Mahloele has never been its director. What is however extremely odd is that, Mr Mahloele himself, in his written submission on 15 April 2019, to the Judicial Commission of Inquiry into allegations of impropriety at the Public Investment Corporation (‘Mpati Commission’) declared in Paragraph 3.3 that: “In addition to the positions already referred to, I also serve on the boards of NOVO Energy, Anergi, Lanseria International Airport, Rainfin, 4 Africa Exchange, Crede Power & Infrastructure Investments and Dark Fibre Africa, amongst others.” One is forced to ask whether Mr Mahloele had then lied to the Mpati Commission, or whether Mr Sandile Sokhela, Crede’s Chief Executive Officer, is lying now (or has lied in his grant/loan application to the DBSA). Someone is definitely lying, and one is worried that public entities, such as the DBSA, are doing business with people of this ilk. 8. I have instructed my attorney, Mr Eric T Mabuza, of Mabuza Attorneys, to submit a Promotion of Access to Information Act (PAIA) application to the DBSA to obtain the attending documentation of Poseidon’s DBSA loan/funding application e.g. the application itself, information on the DBSA’s due diligence, relevant minutes of DBSA meetings, contracts, and any other pertinent information. I implore you to cooperate with our PAIA application, not only because it is to the DBSA’s advantage, but also because it is in the public’s interest that the truth comes to light. 9. Given that the DBSA board has already approved Poseidon’s grant/loan it might be advisable that you immediately suspend any disbursement/s to that company until the matter is satisfactorily addressed by the President and/or the courts. I am at your disposal and look forward to engaging with you. Yours sincerely Mr Bantu Holomisa, MP UDM President Copied to: President of the Republic of South Africa, Mr Cyril Ramaphosa Minister of Finance, Mr Tito Mboweni PIC Chairperson, Dr Reuel Khoza DBSA Company Secretary, Ms Bathobile Sowazi Mabuza Attorneys, Attorney ET Mabuza
Admin
17 Jun, 2020
DBSA: looting of state resources by some of the same people involved in the Public Investment Corporation saga
Dear Mr President DBSA: looting of state resources by some of the same people involved in the Public Investment Corporation saga 1. I write to you with grave concern over the apparent looting of state resources by some of the very same individuals that were found to have had enhanced ability to secure easy access to Public Investment Corporation (PIC) funds. We seem to have the same style of legal corruption, but this time it is at the Development Bank of Southern Africa (DBSA). A curious feature, however, is the emergence of the involvement of the Chairperson of the Government Employees Pension Fund (GEPF). Elitist people seem to behave like locusts that hop from one source of easy funding to the next; voraciously consuming every opportunity they can generate through whatever means. Once they have depleted one source, they effortlessly jump to the next one with the same agenda – enriching themselves at any cost and patting themselves on the back for being such clever operators. 2. I believe your appointment of the Judicial Commission of Inquiry into allegations of impropriety at the PIC, under the leadership of the Honourable Justice Lex Mpati, (‘the Mpati Commission’), was, amongst other concerns, exactly to look into this kind of behaviour that now seems to rear its ugly head at the DBSA. 3. I wish to refer you to an observation made by, and a salient finding of, the Mpati Commission regarding a company called Harith. The Mpati Commission, on page 419, of its report to President Ramaphosa, directly quotes part of my submission, i.e.: “One of the most difficult tasks regarding dealing with the type of corruption that is alleged to have happened at the PIC is the sophisticated nature of the transactions. Corruption can come in two forms, legal and illegal corruption. Legal corruption occurs when the elite build a legal framework that protects corruption or manipulate existing legal framework without necessarily breaking the law.’ The Mpati Commission continued saying that: “When going through the story of Harith, these words resonate.” In paragraph 62 on page 434 the Mpati Commission also stated that: “Harith’s conduct was driven by financial reward to its employees and management, and not by returns to the GEPF. In essence, the PIC initiative, created in keeping with government vision and PIC funding was ‘privatised’ such that those PIC employees and office bearers originally appointed to establish the various Funds and companies reaped rich rewards.” Clearly there is enough motivation to have, at the very least, immediately suspended Harith’s management of any and all of PIC/GEPF funds and launched further investigation. Has government taken any action to protect the PIC/GEPF from these self-enriching individuals? If not, why not? 4. To make matters worse, this recipe for plundering state resources is seemingly being replicated at the DBSA with the very same people involved. This time, at the face of it, with a new vehicle called Poseidon Pty Ltd, of which the shareholding is as follows: On a side note, according to Crede Capital Partners’ website, their team has managed two PIC projects i.e. “Univen” (R920 million) and the “Oceans Hotel Property Development” (R600 million). The Mpati Commission’s view that where Harith was concerned, “…the approach taken provided easy access to PIC funds, influence and including an enhanced ability to secure additional investment…”, it is therefore of interest to know that another company with close ties to Harith Group Chief Executive Officer, Tshepo Mahloele, had access to PIC contracts. 5. The DBSA has recently funded Poseidon to the tune of R50 million to conduct feasibility studies, for some kind of water project/s, in South Africa and other Southern African countries. Another R300 million is apparently still to be disbursed for the implementation of Poseidon’s project. 6. The Mpati Commission also said in its report on page 436, paragraph 67, that: “The Board of the PIC should examine whether the role played by either Mr [Jabu] Moleketi and Mr Mahloele breached their fiduciary duties or the fit and proper test required of a director in terms of the Companies Act.” With this knowledge in mind, please take note that Mr Moleketi (a former DBSA board chairperson) and Mr Mahloele (former head of the DBSA’s Private Sector Investment Arm) are both directors of Poseidon. Mr President, history is repeating; Mr Moleketi had fulfilled the highest leadership roles at both the PIC and Harith. Mr Mahloele, in turn, had been internally transferred (as the Mpati Commission described it) as head of the Pan African Infrastructure Development Fund (PAIDF) to Chief Executive Officer of Harith. The following persons are also Poseidon directors: 6.1. Dr Renosi Mokate (GEPF Board Chairperson), 6.2. Ms Lungile “Zee” Cele (independent non-executive director of Harith General Partners and a former board member of Eskom Holdings SOC Ltd), 6.3. Mr Roshan Morar (former PIC Deputy Chairperson, former Chairman of the South African National Roads Agency SOC Ltd, chairman of Ithala Development Finance Corporation (Ltd) and non-executive director of Harith General Partners) and 6.4. Ms Motseoa Alix-Mary Lugemwa (former Chairperson of the Gautrain Management Agency Board and non-executive director of PAIDF). This list reads like a dream-team of politically exposed persons (PEPs) who seemingly have access to public funds. It is especially worrying to find the name of Dr Renosi Mokate on this list; a scenario where a GEPF Chairperson has access to public funding using a private conduit, after having seen what happened at the PIC, is indefensible. She must be removed as GEPF Chairperson with immediate effect. It is also worth noting that Mr Roshan Morar is named and shamed in the Mpati Commission’s report regarding the Lancaster Steinhoff, Project Sierra case study. The Commission on page 41, paragraph 98, said that: “The chair of the IC [Investment Committee] was Mr Roshan Morar, a PIC non-executive director, who signed off on the IC resolution for this investment. At the same meeting, he was also appointed as a board member to L101 representing PIC’s interests which clearly indicates a conflict of interest.” 7. It would be advisable that Treasury quickly intervenes in the DBSA’s funding of Poseidon’s water project and that it immediately freezes the payment of the first tranche of R50 million, as well as the second tranche of R300 million implementation funding, until the Mpati Commission’s findings and recommendations are addressed. If the R50 million has already been disbursed, it must also be recouped in the meantime and it might be advisable to follow the paper trail to see if the money was spent for its intended purposes. 8. Another matter that I wish to address with you is that of Ms Irene Charnley and her inclusion on the PIC’s interim board. She allegedly received R1,7 billion (in today’s terms) from the PIC for her company, Smile Telecoms Limited. I wrote to Finance Minister Tito Mboweni about this matter on 3 June 2020 and have attached the letter for your ease of reference. Since writing that letter, I have heard that the PIC has written the R1,7 billion off as a bad investment. Moreover, it has come to my attention that Ms Charnley has also knocked on the DBSA’s door for funding. She received a USD 20 million loan, which she has failed to pay back. The Al Nahla Group, with whom she is partnered, is a Saudi Arabia-based company. The situation might mean the PIC and DBSA’s monies were channelled out of South Africa on purpose and someone else is smiling to the bank, because it definitely is not South African investors. We now know of two instances where Ms Charnley dipped into public funds, where the money seems to have evaporated into thin air. On what basis would a government serious about fighting corruption dispatch a person of this quality and competence to resuscitate a key public entity such as the PIC? The consequences for her actions should not have been to be rewarded, at the very least, she should be immediately removed as a member of the PIC’s interim board. Yours sincerely Mr Bantu Holomisa, MP President of the United Democratic Movement Copied to: Minister of Finance, Mr Tito Mboweni DBSA Chairperson, Mr Enoch Godongwana PIC Chairperson, Dr Reuel Khoza
Admin
05 Apr, 2019
Mpati Commission should look at GEPF and PIC investment in Sibanye-Stillwater
The United Democratic Movement (UDM) wishes the Mpati Commission to take a deep look into the investment linkages between the Government Employees Pension Fund, the Public Investment Corporation and Sibanye-Stillwater. Sibanye had acquired the Stillwater Mining Company and is located and managed in two regions i.e. Southern Africa region and the United States region. We understand that the Government Employees Pension Fund (GEPF) and the Public Investment Corporation (PIC) has invested in Sibanye-Stillwater. The questions the UDM wishes the Commission of inquiry into allegations of impropriety regarding the Public Investment Corporation to ask, are, amongst others: • How much of the GEPF and the PIC’s monies are invested in this deal? • How much of that money lies outside our borders? • How was the deal structured and what does this mean for government workers’ pensions? • Why is Sibanye-Stillwater hellbent on retrenching South Africans thus jeopardising the future of hundreds-of-thousands of mineworkers, especially considering the impact that retrenchments have on these families where those salaries are their only source of income. To get to the bottom of the matter, the Mpati Commission should summon the aforementioned parties to testify before it, as well as the Association of Mineworkers and Construction Union which have made allegations of wrongdoing in the company. Issued by: Mr Bantu Holomisa, MP UDM President
