One Friday afternoon in October 2015, Duduzane Zuma — the son of then president Jacob Zuma — took deputy finance minister Mcebisi Jonas to a private meeting at the Gupta brothers’ home in Saxonwold, Joburg.
Once there, Jonas told the commission of inquiry into state capture, Rajesh Gupta offered him R600m to accept a promotion and displace finance minister Nhlanhla Nene.
In Jonas’s telling, the brothers said: “You must understand, we are in control of everything” — the National Prosecuting Authority (NPA), the Hawks and the National Intelligence Agency, as it was known at the time.
Seven years later, and with state agencies in new hands, state capture commission chair Raymond Zondo has recommended that Rajesh Gupta be charged for bribery. That’s just one of the recommendations arising from the chief justice’s most recent report on state capture, released late last month.
But the Gupta brothers have yet to be located and returned to SA, which means they cannot yet be charged.
The groundwork has been done, but the matter is in the hands of Interpol, deputy national director of public prosecutions Anton du Plessis tells the FM.
It’s therefore unlikely that any of the brothers will feature in the nine “seminal” state capture cases that the NPA is planning to enrol over the next six months.
The prosecuting authority has not yet revealed what these cases are, but Du Plessis says they are specifically aimed at “the architecture of state capture”.
State capture, he notes, involved both private sector and government players and was “a very high-level racketeering operation”, making prosecution complex. “This was orchestrated at the highest level of government and using machinery of state.”
Complicating matters is that some of the alleged perpetrators remained in control of state agencies until very recently, and have tried to undermine efforts to bring them to book.
We need to ask the fundamental questions on why it is that people can be this corrupt
— Anton du Plessis
Three years ago, President Cyril Ramaphosa proclaimed the Investigating Directorate (ID) in the office of the national director of public prosecutions in a bid to step up the fight against corruption. It has so far declared 82 investigations, enrolled 20 cases with 65 accused, and frozen R5.9bn worth of assets.
But prosecuting complex cases is expensive, and the NPA is running short of funds, which could slow its work.
Last week, the authority told parliament’s portfolio committee on justice that it will need an additional R2.25bn over the next three years to respond to the state capture reports.
Added to this, it needs R1bn a year to strengthen capacity and its witness protection programme, and to modernise its systems in the face of rising crime levels — particularly given an expected increase in the complexity of organised crime and corruption over the coming decade.
Du Plessis told the committee that the additional R1.1bn the department received earlier this year to top up its R4.6bn budget has helped, but “to deliver on the mandate and the expectations in the growing complexity of the environment we are working in, we are going to need additional funding”.
In the meantime, the NPA is focusing on pooling resources with other agencies. The ID, for example, has been collaborating with the state capture commission after an amendment in regulations in July 2020 allowed the directorate access to the commission’s evidence.
As the commission prepares to release its final report — it’s been given until June 15 — the ID’s spokesperson, Sindisiwe Seboka, says the two entities are in talks to ensure “a seamless transition phase of the commission’s work”.
Eskom has also been roped in to assist. NPA head Shamila Batohi and her team have met with Eskom CEO André de Ruyter to discuss how the ID can work with Eskom investigators and legal experts to bring the guilty to book, especially in “complex and seminal cases”, the two entities said in a statement.
They will also co-ordinate efforts on crimes such as cable theft and “damage to essential infrastructure” that causes blackouts.
That still leaves the budget issue. Private sector funding has been mooted but “it is not something we will do now”, Du Plessis says. “We will have to put in protocols and mechanisms to do this.”
It’s a risky business, considering the role private companies played in state capture and the perceptions of impropriety that private funding could create. And any such venture would in any case have to be routed through National Treasury and the justice department.
Funds are important, Thuli Madonsela, law trust chair in social justice research at Stellenbosch University, tells the FM. It’s something she knows all too well from her days as public protector. At the time, her office also considered private funding, but ran into too many difficulties in this regard.
“Parliament should give [the NPA] what they want,” she says, adding that the money is “nothing compared to how much we spend on SOEs [state-owned enterprises] and certainly far less than what we have spent on the Zondo commission”. (That tally is at R1bn so far.)
The NPA has already faced accusations of not moving swiftly enough on prosecutions, and any lack of resources could slow it down further — and hamper successful prosecutions.
“Should a case fail in court, more damage is done than if it was never taken to court,” Madonsela says. In her view, successful prosecutions are necessary to instil faith in the judicial system, as well as hope.
When people are without hope, they either give up hope and there is despondency, or they go to a dog-eat-dog situation
— Thuli Madonsela
“For me, hopelessness is dangerous,” she says. “When people are without hope, they either give up hope and there is despondency, or they go to a dog-eat-dog situation.”
Madonsela says the NPA should be thorough when prosecuting the state capture cases, but bringing the Guptas to book will be equally important.
“They shouldn’t make the same mistake they did with Schabir Shaik,” she says, referring to Zuma snr’s financial adviser. While Shaik was convicted of corruption, Zuma himself has yet to have his day in court.
“The crime of corruption doesn’t just involve one party. The companies [involved in state capture] were co-owned by the [former] president’s son and the Guptas. That particular reality doesn’t seem to feature in the public narrative.”
DA MP Glynnis Breytenbach, a former prosecutor herself, says the ID “must play smart, pick their battles and not prosecute everyone for hundreds of counts. Four or five strong counts [will be enough to] put them in jail.”
She also believes it’s important to pay attention to the training of prosecutors for complex commercial crimes. “Training and court exposure are vital,” she explains. Unfortunately, in her view, prosecutors “are getting neither”.
But even if the NPA were to get all the money it wants, “there is no way we can prosecute ourselves out of this problem”, Du Plessis says. “SA needs to recognise that.”
There are, however, other ways to ensure accountability — through auditing firms and political parties, for example, as well as professional bodies, lawyers’ associations and banks. And, says Du Plessis, a national anticorruption strategy is vital.
In the end, though, “we need to ask the fundamental questions on why it is that people can be this corrupt”, he says.
The NPA is making slow progress on state capture cases — but it will be difficult to reckon successfully with corruption in the absence of additional resources
— What it means:
It’s not all bad news, though, and the NPA has seen some successes. Just last week, for example, the high court in Mangaung dismissed a last-minute application, brought by the directors of Islandsite Investments 180 and their associate Iqbal Sharma, to postpone arguments to confirm an interim restraint order against the company.
Islandsite is owned by Atul and Rajesh Gupta, and their wives, Chetali and Arti Gupta.
The Joburg high court has also overturned a 2020 ruling that unfroze R1bn in assets allegedly linked to the looting of Transnet through Regiments Capital.
That company’s directors, Niven Pillay, Litha Nyhonyha and Eric Wood, have all been implicated in state capture at the rail, port and transport SOE. The state alleges that Regiments passed on to Salim Essa, a key Gupta family associate, 30% of the fees it received as an adviser to Transnet.
In the Free State, the high court has dismissed interlocutory applications by the accused in the R255m asbestos tender fraud. Suspended ANC secretary-general Ace Magashule and his co-accused argued there is no validity to the state’s case and that his arrest was politically motivated. The NPA, however, argued that these matters should be raised by the accused during the trial.
Meanwhile, alleged Gupta associates Kamal Vasram and Saliesh Indurjeeth have been arrested and charged with fraud amounting to R37.7m at the Estina dairy project in the Free State.
A joint investigation by the ID and SA Revenue Service suggests that Estina submitted customs clearance documents in support of a VAT refund claim that was excessively high. It is suspected that the Gupta brothers did this to launder money and extract funds from SA.
Finally, in a case unrelated to state capture, several former Tongaat Hulett executives, as well as a Deloitte audit partner, have been charged with fraud following an almost two-year investigation into an alleged accounting scandal at the sugar producer, with fraud charges totalling R3.5bn.
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