President Cyril Ramaphosa. Photo: Dwayne Senior/Getty Images
PResident Cyril Ramaphosa on Wednesday expressed concern over allegations surrounding Justice Minister Thembi Simelane's links to the VBS scandal and called for him to give a full report on the matter.
“President Cyril Ramaphosa is concerned by media reports containing allegations of corruption against the Minister of Justice and Constitutional Development,” the presidency said in a statement.
“The President has requested a detailed report and explanation from the Minister on the matter.”
This follows reports that the city made illegal investments in VBS Mutual Bank in 2016, when Simelane was mayor of Polokwane.
An investigative report by lawyer Terry Motau found that VBS, historically a small lender and depositor to retail lenders and Stoke Bell, launched a campaign to solicit large amounts of deposits from councils through a system of paying “fees”.
“This often involved the payment of bribes to various public officials who were in a position to influence the handling of these deposits,” he wrote in a report commissioned by the South African Reserve Bank in 2018, the year the bank collapsed.
Simelane admitted to taking a loan of R575 000 from Gundo Wealth Solutions, owned by Laliom Raswinane, a company that brokered the municipality's investment in the bank. Raswinane is accused of accepting bribes from the bank for brokering the municipality's investment.
The minister said this was a commercial loan taken out to purchase a coffee shop, which he has since repaid in full.
But the information has caused anxiety among government officials and led to calls for Simelane to provide more information.
Freedom Under Law, an advocacy group, said the minister had not provided evidence of the loan agreement or settlement.
“Further questions arise: even if some loans were repaid in full, the publicly available facts raise serious doubts as to whether it was appropriate for the Minister to enter into such loans in the first place, given their apparent connection to illegal deposits into VBS Bank by the same municipality where the Minister served as Mayor,” the report said.
The report highlighted that Simelane has political responsibility for key law enforcement agencies, including the National Prosecuting Authority, and has been at the forefront of the country’s fight against corruption.
They are also involved in the investigation and prosecution of the collapse of VBS Bank itself.
“South Africa has suffered a scourge of corruption in recent years, with criminal individuals too often allowing their justice sector to be corrupted,” Freedom Under Law said.
“We therefore demand that the minister provide a full explanation for his involvement in this incident. It is unacceptable that such serious allegations against a minister in such an important position should remain unanswered.”
Athol Trollip, from Action SA, said given Simelane's influence over the National Prosecuting Authority, the Public Protector must determine whether Simelane's involvement in the deal was a conflict of interest or a breach of the code of ethics.
“I believe the integrity of our justice system is at risk if someone tasked with upholding the law could be put at risk by engaging in illegal transactions linked to one of the most egregious corruption scandals in which money was stolen from the most vulnerable.”
“I am therefore raising this matter as an immediate and thorough investigation is necessary to preserve the credibility and impartiality of our judicial system,” he said.
The Democratic Alliance also said the minister must answer the allegations in parliament at the Ministry of Justice.
“At the very least, the minister needs to be summoned to Parliament to explain what steps she intends to take to manage the apparent conflict of interest between her role as Minister for Law and Constitutional Development and her role in relation to the work of the Constitutional Development Commission. [National Prosecuting Authority]The company will no doubt be investigating this transaction with the Minister,” it said in a statement.
The Economic Freedom Fighters have called for the immediate resignation of Justice Minister Simelane, adding that she cannot be entrusted with the responsibility of overseeing South Africa's judiciary.
