When he took office in 2018, President Cyril Ramaphosa appointed new heads for law-enforcement agencies and vowed to bring fraudsters and looters to book.
Yet, five years on, crime has spiked, most of the crooks still walk free and the law-enforcement agencies are in a shambles.
What went wrong? In his latest book, 'Our Poisoned Land', Jacques Pauw picks up where he left off in The Presidentʼs Keepers and delves deep to find answers
The police general who sabotaged the fraud and corruption case against the looters of the Passenger Rail Agency of South Africa (Prasa) and failed to make any progress in the Steinhoff investigation, Maj-Gen Alfred Khana, is now head of the organised crime unit at the Hawks.
He was promoted to the post by Hawks head Lt-Gen Godfrey Lebeya, who was appointed in 2018 to resuscitate the unit. Evidence has emerged that Lebeya has been protecting Khana, whose new appointment comes amid warnings from a senior National Treasury official that South Africa is in danger of becoming a “mafia state” due to its failure to curb money laundering and other financial crime.
This is an edited extract…
The failure of the Hawks to bring the looters and enablers of Prasa to book must count as one of the police’s biggest betrayals ever of the people of South Africa. The Hawks had had evidence of the wrongdoing at Prasa since the end of 2015. Subsequently, year after year, testimony of more criminality piled up.
But, at the same time, a true hero of state capture emerged at Prasa: Popo Molefe, who was appointed chair of the board in August 2014 and who held the reins for more than three years. He was supported by a handful of senior Prasa officials who resisted the allocation of manipulated tenders to ANC cronies.
Towards the end of August 2015, Molefe filed 43 criminal complaints with the Hawks arising from a host of forensic investigations into corruption and fraud at Prasa. All the evidence from the investigations was transferred to the crime-fighting unit. Maj-Gen Senaba Charles Mosipi was then commander of the Hawks’ commercial crime unit. Prasa and the Hawks reached an agreement that the rail agency would pay for the services of expert forensic accountants to assist the police in their probe.
Mosipi appointed forensic accountant Ryan Sacks, a director at Horwath Forensics (now Crowe Forensics), to conduct a cash-flow analysis of irregular, wasteful and fraudulent expenses relating to the Swifambo locomotive contract, followed by a similar exercise for the Siyangena contract. Sacks already possessed extensive knowledge of the two contracts because Werksmans had appointed him to assist in its earlier investigation.
But this was the Hawks of the nightmarish Berning Ntlemeza, unlawfully appointed as commander of the elite unit in September 2015. If it had been his mission to make sure that the Hawks did not disrupt the state-capture project and safeguarded the looters against prosecution, he could hardly have done a better job.
At the end of January 2016, Ntlemeza fired Mosipi and banished him to the dark innards of the Hawks. He then appointed an incompetent puppet, Maj-Gen Alfred Khana, as the new head of the commercial crime unit.
If it had been his mission to make sure that the Hawks did not disrupt the state-capture project and safeguarded the looters against prosecution, he could hardly have done a better job
Khana has had a chequered history in the SAPS. In 2013, then Hawks head Anwa Dramat ordered a fraud investigation against Khana, then a brigadier and head of commercial crime investigation in Gauteng. Khana requested a transfer to the Gauteng provincial government before the investigation was finished, probably to avoid a disciplinary hearing.
Ntlemeza brought Khana back to the Hawks. Khana reportedly ordered a raid on the office of Eastern Cape Hawks investigator Capt Luphumlo Lwana in August 2017 to remove 20 dockets he was investigating. Many of his probes implicated prominent Eastern Cape politicians, mayors, officials and councillors allegedly involved in fraud and corruption.
Khana was also implicated in evidence before the state capture commission in Ntlemeza’s persistent hounding of Johan Booysen. When the Hawks boss suspended Booysen on trumped-up fraud charges, it was Khana he appointed to investigate.
***
Popo Molefe and several Prasa executives, among them the head of legal risk and compliance, Martha Ngoye, and the general manager of legal services, Fani Dingiswayo, met Khana and the forensic investigators in April 2016.
Khana assured Prasa that the Hawks had identified the main suspects, that subpoenas had been issued in terms of section 205 of the Criminal Procedure Act, and that the Assets Forfeiture Unit was preparing to seize and preserve assets.
But nothing happened. The Hawks stonewalled, saying Prasa had not provided the necessary evidence to compile a prosecutable docket. It was a tired old trick used time and again during the state-capture years to prevent politically connected cases from moving forward.
In fact, Prasa provided the cops with all the documentation they needed — the contracts, correspondence, bank accounts, financial records, minutes of meetings, and subsequent forensic investigations with all their supplements and attachments.
What the Hawks had to do was trace the flow of money (which Sacks was doing for them and which Prasa was paying for), subpoena the bank accounts and documents they needed, track down the beneficiaries, secure witnesses, take statements, do lifestyle audits, liaise with prosecutors, compile a prosecutable docket and execute arrests.
In her evidence to the state capture commission, Ngoye said: “It has been so frustrating dealing with the Hawks because they come back with the same issues all the time and you just do not understand what they want. We have given information and they come back and they say we have not given information.”
Judge Raymond Zondo: “They are not up to the job?”
Ngoye: “No, they are not up to it, chairperson. In that meeting, Khana told the chairperson of the board that we had provided no information to them about Swifambo and Siyangena.”
In July 2016, Molefe supplied the Hawks with an additional 16 lever-arch files of documentary evidence relating to the Swifambo matter. Khana reiterated that the documents provided to the Hawks were not useful in a criminal investigation.
Outraged, Molefe wrote to Ntlemeza a month later and said it was clear that Khana had failed to familiarise himself with the available evidence and information.
Sacks told Zondo that he’d had a meeting with the Hawks in Pretoria in April 2017 and presented the results of his money-flow investigation of the Swifambo locomotive contract. His investigation exposed a web of corruption within and outside Prasa and showed how hundreds of millions in taxpayers’ money had been diverted to Auswell Mashaba, Makhensa Mabunda and a host of other entities, high-ranking public officials and beneficiaries connected to them.
The essence of Sacks’s findings was confirmed three months later when the Johannesburg high court set aside the Swifambo contract and ruled that Prasa had awarded the contract through a “corrupt tender process” and that Swifambo had acted as a mere front for the locomotive manufacturer Vossloh.
All the evidence and documentation from Prasa’s application in this matter was transferred to the Hawks. In the second part of the Swifambo investigation, Sacks would have proceeded to forensically analyse the recipients of the money and what they did with it.
Sacks never heard from the Hawks again. They never asked any questions about his money-flow findings in the Swifambo matter. They didn’t provide him with accounts and information to carry out the next phase of the investigation, and they never commissioned the Siyangena part of his forensic probe — despite Prasa paying Sacks.
By then, Molefe and the Prasa board had had enough. They took the unusual step of taking the Hawks to court to force them to investigate the R14bn in irregular expenditure. The Hawks opposed Molefe’s authority to bring the application‚ describing it as “fatally defective”.
***
By the time the Steinhoff dockets landed on Khana’s desk at the end of 2017, Ntlemeza was gone, Cyril Ramaphosa was president-in-waiting and Godfrey Lebeya was being mentioned as the new Hawks head. The Steinhoff case was Khana’s opportunity to flaunt his investigative skills and, after the Prasa fiasco, redeem himself and his reputation.
Eight months after the rot in Steinhoff came to light and state pensioners lost investments worth billions, the Hawks had apparently not identified a single suspect. Any trainee constable in the police college could have done so
Days after her appointment as acting head of the Hawks, Lt-Gen Yolisa Matakata and Khana headed to parliament to report back on various investigations, including that of Prasa. Khana said the serious commercial crime unit had a “large volume of cases”, but he couldn’t provide a list because it “was long”. Khana reported no progress on Prasa because he claimed that the investigatory and forensic reports that Molefe had provided lacked supporting documents and were therefore not useful. It was a lie he repeated time and again.
Eight months after the rot in Steinhoff came to light and state pensioners lost billions, the Hawks had apparently not identified a single suspect. Any trainee constable in the police college could have done so.
Khana told the parliamentary police committee: “There are three cases, but with no substance to them. The three cases lodged were based on media reports and failed to contain details investigators required, such as who committed what offence in which way and at what cost. Without such details, the elements of a crime were not established.”
In May 2018, Lebeya was appointed as head of the Hawks to resuscitate South Africa’s premier crime-fighting unit from the devastating neglect of the Zuma administration.
Khana’s position in the Hawks had become untenable and plainly embarrassing. But what to do with the troop of devoted Ntlemeza henchmen skulking in the unit? Lebeya brought Mosipi back as head of the commercial crime unit — the post held by Khana.
What to do with Ntlemeza’s puppy-in-chief?
What happened next boggles the mind. Organised crime head Sylvia Ledwaba was moved sideways to make space for a new incumbent: Khana. Yes, the undertaker of the Prasa investigation and the procrastinator of the Steinhoff case became head of the serious organised crime unit of the Hawks. Khana is still the country’s chief organised-crime fighter, although Ledwaba mercifully called it a day and resigned at the beginning of 2021.
***
On August 23 2021, Lebeya, appointed in May 2018, submitted an affidavit to the state capture commission. In it, he said the Siyangena and Swifambo investigations were “delayed” because Prasa was unco-operative and failed to provide documentation and statements to his investigators.
All the evidence suggests that, in doing so, he attempted to mislead a judge and lied under oath, which is a criminal offence.
Zondo said in his final report: “The DPCI [Directorate for Priority Crime Investigation, the Hawks] has scored an own goal in the way it has failed to act diligently to investigate the criminal complaints laid many years ago by Prasa. One possible reason why it has dragged its feet may be connected with the risk or fear that any proper investigation may well lead to the ANC or to certain figures within the ANC.”
Lebeya offered a bizarre explanation as to why the Hawks rejected the Sacks money-flow investigation into Swifambo. He said that Mashaba had complained to the Hawks about the Sacks investigation, and as a result police investigators withdrew Sacks’s mandate (without informing him).
Can you imagine that a suspect in a billion-rand fraud and corruption case who doesn’t like the forensic investigator combing through his bank accounts and financial records would phone the general in charge and ask him to get the pesky investigator off his case?
But the story gets worse. Lebeya said the investigators then discussed Sacks’s report with prosecutors, “who raised a concern and discomfort” about the “objectivity” of his work and advised that an “independent report” by another forensic investigator should be obtained.
Zondo rejected Lebeya’s explanation and said there was no evidence that Sacks’s report was not impartial. He remarked: “If this is what has happened and is genuine, the DPCI would have asked Mr Sacks’s firm to comment on the allegation of bias, but they did not.”
He concluded: “All this suggests that their explanation is false and there is something more to the DPCI’s conduct. I reject their explanation.”
Zondo’s devastating remarks about Lebeya are hidden deep within the almost 250 pages he devoted to Prasa’s capture in his final report of more than 2,000 pages. As a result, nobody picked up on Lebeya’s big lie, saving him public embarrassment and humiliation for trying to cover up the Hawks’ investigation.
***
Just four entrepreneurs — Roy Moodley, Auswell Mashaba, Mario Ferreira and Makhensa Mabunda — were the beneficiaries of two irregularly awarded contracts worth R8bn. In return, Prasa did not get much more than 13 oversized and unusable locomotives and security upgrades that have since been destroyed.
What became of the money that was looted from Prasa? One answer may be found tucked away in the vast expanse of the Limpopo bushveld. Here lies AM Lodge, where the echoes of the wild hug you in the lap of luxury. With its five-star rating and string of international awards, AM Lodge houses just 22 guests in the utmost comfort.
The lodge is nothing but an obscene shrine to a state capturer, a monument to one of those who gobbled up billions of rand of public money and gave the country back just 13 oversized locomotives
It is a hideaway that caters only for the discerning. To stay in the Ngala (Shangaan for “lion”) suite, where “the roars of ngala echo through the AM Lodge landscape as mother nature calls”, costs a cool R30,000 a night for a couple. There is also a free-standing villa with its own chef and butler for R35,000 a night. AM Lodge is supposedly testimony to the business acumen of its founder and owner, Auswell Mashaba, executive chair of AM Investments and founder of AM Consulting Engineers.
In fact, AM Lodge is nothing but an obscene shrine to a state capturer, a monument to one of those who gobbled up billions of rand of public money and gave the country back just 13 oversized locomotives. Mashaba seems to have no shame in flaunting his spoils.
Five days after Prasa made its first payment of R460m to Swifambo in 2013, a Mashaba company purchased three parcels of land and a lodge near Hoedspruit for R27m. This became AM Lodge.
Since its inception, AM has expanded its luxury portfolio across South Africa. It now operates spas throughout the Kruger National Park, an upmarket restaurant in the Manyeleti Game Reserve in Limpopo, a R14,000-a-day villa at the Zimbali coastal resort in KwaZulu-Natal, and a Provençal-style boutique hotel in Pretoria.
Mashaba has further diverted R24.5m from the locomotive contract to his trust to acquire a majority shareholding in the Orange Grove farm outside Robertson in the Western Cape. Nestled in the spectacular Breede River valley, the wine and olive farm is marketed as a luxurious retreat with a 200-year-old manor house and a collection of cottages, each offering private plunge pools and verandas overlooking the vineyards.
The state capture commission subpoenaed Mashaba to appear before it, presumably to explain his questionable gains. Just days after Jacob Zuma had refused to appear before the commission in February 2021, Mashaba followed suit and said his subpoena was unlawful — the same reason Zuma gave.
Zondo said that if the behaviour of Zuma and Mashaba spread, it could result in chaos in the commission and the courts. He ordered the commission secretary to lay a criminal charge of contempt against Mashaba. That was early in 2021. How difficult can it be to prosecute Mashaba for snubbing the commission?
ABOUT THE AUTHOR
Veteran journalist, filmmaker and author Jacques Pauw has won awards locally and internationally, including CNN African Journalist of the Year, the Award for Outstanding International Investigative Reporting and the Nat Nakasa award for bravery and integrity in journalism. He is the author of The President’s Keepers, which deals with the endemic corruption of the Zuma years
• This is an edited extract from ‘Our Poisoned Land: Living in the Shadows of Zuma’s Keepers’. (Tafelberg)
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