SECTION 194 IMPEACHMENT INQUIRY
Toxic cloud of secrets and lies over 2013 Zuma-Putin nuclear deal hovers above Busisiwe Mkhwebane’s historic legal battle
Where exactly does Busisiwe Mkhwebane fit into the greater State Capture nexus that flourished during the Zuma years? The question is about to be answered at her impeachment inquiry.
Former president Jacob Zuma’s secret and potentially ruinous nuclear deal with Russian President Vladimir Putin in 2013 hovers like a toxic cloud over Public Protector Busisiwe Mkhwebane’s Section 194 impeachment inquiry.
The real meat and potatoes are expected to be served piping hot next week when the inquiry’s evidence leader, Advocate Nazreen Bawa, is expected to cut through the murky politics and theatrics that have bedevilled the historic two-year process.
Also lurking in the mix are the Guptas – benefactors of Zuma and his enablers. State Capture contracts involving the Gupta enterprise cost South African taxpayers R57-billion over the years.
Mkhwebane is a firm favourite of the EFF, with which she has happily cooperated. She is also a fan of Zuma, regardless of his shameful fall from office and the resultant economic devastation.
The suspended Public Protector has presented herself throughout her impeachment inquiry as a champion of the poor who fought off powerful “forces”, “untouchables” and “capital”, viewed by her and the loose band of Radical Economic Transformation (RET) acolytes as a threat to Zuma’s utopian vision of South Africa. She is, she has argued, a victim of a political “witch-hunt” cooked up by the opposition DA in cahoots with a faction of the governing ANC.
Read more in Daily Maverick: Busisiwe Mkhwebane claims probe nothing more than ANC and DA political witch-hunt for touching ‘untouchables’
Mkhwebane in the eye of the storm
In April 2017, thousands of South Africans across the country took to the streets after Zuma had fired the finance minister and his deputy, Pravin Gordhan and Mcebisi Jonas, respectively, leading to South Africa’s slide into “junk” status and calls for Zuma to resign.
Gordhan had been shuffled out of the Cabinet by Zuma once before. He was replaced in 2014 by Nhlanhla Nene, who served as finance minister until December 2015. Nene testified to the Zondo Commission that he had faced enormous pressure to sign off on the nuclear deal.
He was replaced by David van Rooyen, but after another national outcry Zuma began to position former Eskom CEO Brian Molefe for the job. Molefe was prepared to fling open the doors of the Treasury, smoothing the way for the deal with Russia and Rosatom as well as others with Denel Asia, SAA and PetroSA.
Instead, Gordhan found himself back in the hot seat with the keys to the kingdom safely back in his pocket.
That is until Zuma’s midnight reshuffle in 2017, when he replaced Gordhan with Malusi Gigaba, a good friend of the Guptas. Gigaba was thankfully axed when Cyril Ramaphosa beat Zuma to lead the ANC that December.
So far, more than 20 witnesses have delivered shocking testimony to Mkhwebane’s impeachment inquiry of how the State Security Agency (SSA) – heavily implicated in the High Level Review Panel and the State Capture Report – involved itself with her office, including Arthur Fraser, its former director-general.
The SSA has been accused of running an illegal parallel agency with access to unlimited public funds in order to bolster Zuma’s personal and political power. Many members of Zuma’s Cabinet at the time have also been implicated, including former minister of state security David Mahlobo, who remains in active government service.
Read more in Daily Maverick: Inside Busisiwe Mkhwebane’s State Security Agency-riddled Public Protector’s Office
The impeachment committee consists of 26 members representing 14 political parties in the National Assembly. They are expected to vote on Mkhwebane’s impeachment (or not) before the end of her term of office in October 2023.
The inquiry has heard that Mkhwebane had omitted her meetings with the SSA and Zuma, which took place during her CIEX-Bankorp (later Absa) investigation, from her Rule 52 court record. Witnesses have also revealed how Mkhwebane, soon after her appointment by Zuma, began to weaponise her office, reviving old investigations to target specifically Gordhan, the Treasury and the South African Revenue Service (SARS).
Mkhwebane’s investigations, including later probes into Ramaphosa’s campaign funding, were kept on a tight leash, with only her and two trusted investigators working on them, circumventing all quality controls at her office.
In an email Mkhwebane sent to an investigator that was shown at her inquiry, Gordhan was described as “a threat of democracy” who needed to be “stopped before he causes more harm in the guise of cleaning”.
Mkhwebane has consistently insisted that she has always acted “without fear or favour” as the head of an independent Chapter 9 institution.
For a detailed breakdown of the secrecy surrounding Mkhwebane calling Pravin Gordhan “a threat to democracy”, and other bombshells at the Public Protector impeachment hearing, read Karyn Maughan and Kirsten Pearson’s Nuclear: Inside South Africa’s Secret Deal, published in 2022.
Without fear or favour
A photograph of a smiling Mkhwebane holding a copy of Zuma’s hot-off-the-press “biography”, Jacob Zuma Speaks, was circulated widely on social media soon after the book’s release in December 2021.
She also had no qualms about tweeting a recommendation of A History of Central Banking and the Enslavement of Mankind by the Hitler-loving Holocaust denier Stephen Goodson, in April 2017.
Mkhwebane was clearly doing deep research for her investigations into central banks. So much so, the committee has heard, that an SSA official had in fact provided the wording for her suggested changes to the Constitution in her final CIEX report.
— Adv Busisiwe Mkhwebane (@AdvBMkhwebane) April 25, 2017
Mkhwebane released this report with its attempts to alter the constitutional mandate of the South African Reserve Bank in June 2017. Her recommendations are among the actions that have brought her before the impeachment committee.
In April 2017, Zuma had initiated a meeting with the South African Reserve Bank governor, Lesetja Kganyago, ostensibly to “discuss the economy” – this with Gordhan and Jonas’ firing fresh in mind. Jonas later testified that he had turned down a bribe from the Gupta family in 2015 already.
Testifying at the Zondo Commission, Jonas set out how Gupta patriarch Ajay Gupta had offered him R600-million, ostensibly to smooth the family’s path should he be appointed finance minister.
Part of the plan, Jonas testified, was the firing of then Treasury director-general Lungisa Fuzile, head of tax and financial sector policy Ismail Momoniat, senior technocrat Andrew Donaldson and chief procurement officer Kenneth Brown. All of them have since left the Treasury.
Read more in Daily Maverick: What the Guptas wanted from Mcebisi Jonas
Enter – and exit – Brian Molefe
Molefe had resigned as CEO of Eskom in 2016 after serving only 11 months following the release of the bombshell State of Capture report by outgoing Public Protector Thuli Madonsela. Molefe, it was found, had close links with the Guptas and their “Saxonwold Shebeen”.
Molefe was the chess piece Zuma planned to move into place, and he was swiftly shuffled into Parliament and hastily sworn in as an MP with the excuse that he had been nominated to fill a vacancy on the North West list of ANC MPs.
But with Zuma’s plan thwarted and the Treasury out of reach and still putting the brakes on the Rosatom deal, Molefe was returned triumphant to Eskom in May 2017.
A vocal supporter of nuclear power, he immediately began pushing for the energy utility to invest in it. He had embarked on a three-week course in nuclear reactor technology for executives at the Massachusetts Institute of Technology in the US in 2016.
Read more in Daily Maverick: The Nuclear Build Risk is not yours to take, Mr Molefe
VBS, the Guptas and the banks
In June 2017, Mkhwebane released her CIEX report finding the South African Reserve Bank’s bailout of Bankorp between 1985 and 1995 had been unlawful and the Constitution should be changed.
Kganyago immediately filed an urgent application to have the remedial action set aside. In an interview, he stated that the closure of the Gupta family’s accounts by commercial banks in mid-2016, as well as the Venda Building Society (VBS) mutual bank being placed under curatorship, had “sparked a political fightback”.
In August 2017, the South African Reserve Bank won its application to have Mkhwebane’s remedial action to change its constitutional mandate set aside. She had been wrong in law, the court said in a scathing judgment.
VBS was declared insolvent in March 2018 after defrauding its clients of about R2-billion, some of which was redirected to EFF deputy leader Floyd Shivambu’s brother Brian, through his company Grand Azania.
Read more in Daily Maverick: Beyond reasonable doubt: VBS scandal exposed Julius Malema and Floyd Shivambu’s corrupt dealings
In 2012, it had been Madonsela and SARS that revealed that EFF leader Julius Malema, then the leader of the ANC Youth League, was using his Ratanang Family Trust to receive questionable income to support a visibly extravagant lifestyle.
The National Prosecuting Authority, led during Zuma’s tenure by a series of discredited heads, including Shaun Abrahams, dropped the criminal case against Malema. It has been dead in the water ever since (although you never know).
A now restored SARS, which had suffered prolonged and sustained attack during Zuma’s presidency, succeeded in shutting down Grand Azania, Brian Shivambu’s company, earlier this month.
SARS had applied for the liquidation of Grand Azania in July 2021, when the company was unable to pay its R11.5-million tax debt.
Why RET forces needed Mkhwebane
On the boil since 2011, National Treasury and Gordhan only learnt of the face-to-face nuclear agreement with Putin in 2013, when the then Department of Energy asked for a “tax incentive” structure for the deal.
In 2017, the man who stood in the doorway between Zuma, Putin, the nuclear deal and the voracious Gupta family was Gordhan.
In January that year, the ANC – still led by Zuma but not for long – began pushing for the release of Madonsela’s provisional report on the Bankorp-Absa bailout.
Gordhan, it must be remembered, was the former head of SARS. During his tenure between 1999 and 2009, the institution had clamped down on tax evasion, particularly in the tobacco industry.
If Gordhan was not going to go down by hook, he would have to go down by crook.
In 2014, shortly after his appointment by Zuma to head the revenue service, Tom Moyane began to restructure SARS on the advice of the now disgraced international consultancy Bain & Company. Bain & Co earned about R2-billion in public sector contracts doing business in South Africa.
Bain whistle-blower Athol Williams revealed that Vittorio Massone, Bain’s managing partner in South Africa, had met with Zuma on at least 20 occasions between 2012 and 2016. This was ostensibly to discuss “reshaping the South African economy”, including “the establishment of a presidential agency that would bypass other state executive bodies”.
Moyane soon set about enacting the bold plans, deploying fake news and propaganda about an apparent “rogue” unit – set up with Gordhan’s alleged approval – that had been targeting politicians.
The target was again on Gordhan’s back.
The Sunday Times was later implicated in publishing fake news about SARS’s High-Risk Investigative Unit, which had made extraordinary progress. Moyane’s attempt to purge SARS of corruption-busters led to a mass exodus of staff.
This report, too, has landed Mkhwebane in front of the impeachment inquiry.
Shortly after Madonsela’s term ended, Mkhwebane laid a criminal charge against her for allegedly violating the Public Protector Act by “leaking” the audio of an interview she had had with Zuma while in office.
Madonsela had left office after releasing her “black swan” – her damning State of Capture report. It later led to the establishment of the State Capture Commission headed by then Deputy Chief Justice Raymond Zondo.
The audio clip was released on 13 October 2016, the day before Madonsela’s extraordinary term of office came to an end. She was still the Public Protector at the time and later said she had been within her rights to release the interview.
Read more in Daily Maverick: Presidency slams Madonsela’s ‘unwarranted public attacks’ on Zuma
That Zuma himself could have charged Madonsela did not cross Mkhwebane’s mind, it appears.
Also, 2017 was the year the #GuptaLeaks hit the headlines, confirming what real investigative journalists had been exposing all along.
Mkhwebane appears to be the last woman standing. For how much longer, we will soon find out. DM168
This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R25.