Fears that purge of senior officials could break SARS

2014-12-12 00:00

THE SA Revenue Service (SARS) is staggering under a widescale “purge” of senior officials by its new commissioner, Tom Moyane.

There are fears in senior government circles that SARS, one of the most stable state institutions since 1994, could “fall apart”.

Since his appointment by President Jacob Zuma in September, Moyane has targeted senior officials who built SARS into a world-class tax collection agency under Pravin Gordhan, who went on to become Finance minister. Gordhan led SARS from 1999 until 2009.

SARS was rocked in the past week by the resignation of chief operating officer Barry Hore and the suspension of deputy commissioner Ivan Pillay.

• While Hore’s departure has been presented as amicable, sister paper Beeld understands that all his technology and development projects were halted by Moyane soon after his appointment. Hore has been widely praised for the successful implementation of eFiling, and the modernisation of SARS’s tax systems.

• Doubt has been cast on Moyane’s reasons for suspending Pillay after it emerged yesterday that a report on the operations of SARS made no findings against Pillay.

• Beeld has reliably learnt that Moyane is considering suspending others who were part of Gordhan’s senior managment.

Three senior Treasury sources told Beeld that Moyane is “out of his depth” and does not understand the complexities of the tax service.

There are fears that the service could become a victim of a “power struggle to control a key state institution … First it was the police, then the National Prosecuting Authority, now SARS”, a senior state official said yesterday.

The suspensions of Pillay, group head of strategic planning and risk Pete Richer, and CEO for investigations ­Johann van Loggerenberg are closely connected to the activities of the National Research Group (NRG), an investigations unit of SARS.

The NRG’s probes led to successful actions against drug syndicates, ­Zimbabwean businessman Billy ­Rautenbach, Glenn Agliotti’s drugs network, abalone syndicates and the multi-millionaire Dave King.

As acting commissioner, Pillay appointed advocate Muzi Sikhakhane to probe the activities of the NRG after reports in the Sunday Times.

Moyane suspended Van Loggerenberg last month and announced on ­Friday that he was placing Pillay and Richer on suspension on the strength of the Sikhakhane report.

His reasons were cast into doubt ­yesterday when Imraan Mohamed, the Sikhakhane panel’s attorney, told ­Eyewitness News that “no findings were made against any third party”.

“There were thus no findings against Pillay or Richer.”

On Friday, Moyane said Pillay and Richer were being suspended because they were “implicated by the panel’s report”.

Sikhakhane’s report is still confidential, but apparently found that SARS was not authorised to run an investigations unit that collected intelligence.

A former senior Treasury official told Beeld that finding made no sense.

“If one is meant to combat illegal activities, you need intelligence.”

Beeld is in possession of a letter signed in 2007 by Gordhan and Trevor Manuel, at the time minister of Finance, establishing an intelligence unit within SARS.

The unit was at first placed with the National Intelligence Agency (NIA), but was moved into SARS after the NIA’s mandate was altered.

Supporters of Pillay and Van ­Loggerenberg say it is “absurd” that they are being punished for running an effective and well supervised crime combating entity.

Reacting to Mohamed’s comments, SARS said Sikhakhane’s report formed the “primary basis for the suspensions, together with other things”.

The suspensions took place so proper investigation can be conducted without any possible interference, it said.

In August, City Press revealed the ­existence of a shadowy unit within the State Security Agency that was apparently aimed at “removing the leadership of SARS”.

It was reported that it concerned the investigation by both the SSA and SARS of tobacco smuggling.

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