DPE welcomes Molefe; Singh’s arrests

The Department of Public Enterprises (DPE) has welcomed the arrest and court appearance of former Transnet executives Brian Molefe and Anoj Singh on charges related to fraud of R398.4 million along with corruption.

It says the damage inflicted on state-owned enterprises (SOEs) is still felt at present and has deprived many South Africans of integral services that are provided by fully functional state entities.

Read: Brian Molefe, Anoj Singh and Regiments directors charged on R398m Transnet fraud

This comes after Molefe and Singh – the former group CEO and former CFO of Transnet, respectively – appeared in the dock, together with Regiments Capital directors Niven Pillay and Litha Nyhonhya on Monday (29 August).

Molefe, Singh and their co-accused are charged with contravening the Public Finance Management Act (PFMA) and fraud, while Pillay and Nyhonhya are also facing money laundering charges.

The DPE says the arrests indicate that law enforcement agencies are following up on key recommendations of the Zondo Commission of Inquiry into allegations of state capture, corruption and fraud in the public sector.

Read: Brian Molefe ordered to repay R10m to Eskom Pension and Provident Fund

“Their appearances go a long way to communicate the message to all South Africans that no stone will be left unturned until those that were complicit and conspired to damage state-owned enterprises as part of the state capture project are brought to book,” adds the DPE.

Minister Pravin Gordhan says the arrests assert that government will not tolerate corruption and fraud at SOEs and in the public sector.

“There [are] no longer ‘fake news’ narratives to avoid accountability. We are now waiting for the state to prove its case so that we can finally see people being locked up,” he adds.

Reflecting on the report on Transnet, the DPE recalled that the Zondo Commission recommended law enforcement agencies conduct further investigations as may be necessary for a possible prosecution of Molefe, Singh, former Transnet Group CEO Siyabonga Gama, former Transnet CFO Garry Pita and former Transnet CEO Thamsanqa Jiyane on charges of corruption and racketeering for cash payments received during Gupta compound visits between 2010 and 2018.

The Zondo report further recommended that law enforcement agencies, amongst others, conduct investigations with regard to:

• The possible prosecution of any Transnet official on a charge in terms of Section 86 of the Public Finance Management Act (PFMA) by wilfully or grossly negligently contravening Section 51 of the PFMA by wrongfully deviating from the evaluation criteria of the instruction note of the National Treasury of 18 July 2012 and provisions of regulations 5 and 6 of the Preferential Procurement Policy Framework Act (PPPFA) regulations relating to the evaluation of the bids for 1 064 locomotives
• The possible prosecution of any member of the negotiations team that conducted the post tender negotiations for Transnet in relation to the procurement of the 1 064 locomotives on corruption charges or in terms of section 86(2) of the PFMA, by acting corruptly or not acting in the best interests of Transnet in managing its financial affairs by agreeing to the payment of excessive advance payments to China North Railway (CNR) and China South Railway (CSR) and not complying with local content requirements of the RFPs (request for proposals) of the tender in relation to the transaction

Read: With the arrest of Molefe and Singh, law enforcement has found its mojo

“The road to fix the damage left by former executives to our SOEs has been hard and frustrating, punctuated by denialism and the fake news narrative and misinformation campaigns,” adds the DPE.

“However, we have worked diligently to ensure we turn around the SOEs so that they become instruments of transformation and provide the much-needed services to all South Africans.”

Nondumiso Lehutso is a Moneyweb intern.