Brother of former spy-boss Fraser hooks fishy permits

2018-05-02 08:00
New correctional services commissioner Arthur Fraser in Parliament. (Paul Herman, News24, file)

New correctional services commissioner Arthur Fraser in Parliament. (Paul Herman, News24, file)

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A company linked to Barry Fraser, the brother of the former spy-boss Arthur Fraser, has been awarded two marine tourism permits by the Department of Environmental Affairs (DEA).

The company, Fronteras Adventures, was granted two marine eco-tourism permits from the DEA after it applied for them in late 2017.

Fronteras Adventures was one of several applicants for permits authorising boat based whale watching (BBWW) and great white shark cage diving (WSCG) businesses along the coast. 

In both cases, existing permit holding operators were stripped of their permits, and were subsequently awarded to Fronteras Adventures. 

The awarding of these permits is currently the subject of several court challenges.

Sea saw

The first permit awarded to Fronteras Adventures was for whale watching in Gansbaai.

Despite having no experience or background in marine eco-tourism, Fronteras Adventures scored more than 97% in the assessment for permit. The score harpooned the prospects of the existing operator, Eubalaena Sea Safaris.

Eubalaena has been operating in terms of the permit since 2014, and is taking the decision by the DEA on judicial review.

Fronteras Adventures was also awarded a shark cage diving permit at Quoin Point, but only after the DEA flip-flopped on the initial assessment and allocation process.

In a letter to the applicants for WSCD permits dated March 13, 2018, the DEA informed all applicants that even though the department had already assessed and awarded these permits, it intends to recalculate and reassess all the applications it received. 

"The delegated authority considered and scored the applications and granted permits in the sector for the reasons as set out in the decision letters circulated to each applicant."

This was due to the DEA finding "significant generic scoring errors" in the assessments upon several appeals to the decisions.

"After considering each appeal, it became apparent that there were significant scoring errors in the sector. After investigation, it appears that in the case of all existing operators their scores were calculated on the incorrect weightings."

The DEA told News24 that the assessment criteria for new and existing applicants differed as follows:

New Applicants:

  • Transformation: 65%
  • Operational Plans: 35%

Existing Permit Holders

  • Transformation 75%
  • Compliance and Enforcement: 15%
  • Investment and Financial Information: 10%

The reasons for the difference in scoring is ostensibly to expand the sector and provide participation to black owned business in the sector.

"The DEA is motivated by the objectives in the BBWW and WSCD policies, including the need to increase participation of [historically disadvantaged individuals] and grow the sectors."

Despite the claimed objective, the DEA's actions have reportedly deprived an existing wholly owned black-owned business, White Shark Cruises, of their shark cage diving permit.

The "reassessment" of the applications suddenly saw Fronteras Adventures emerge as a white shark cage diving permit holder at Quoin Point, scuttling the White Shark Cruises' business in the process.

Questions have been raised about how the DEA intends to "grow the sector" when only a single permit is available for allocation, with the permit merely changing hands every few years.  

Current corrections

To add to this, the DEA's actions in respect of the withdrawal and reassessment of the WSCD permit may have been unlawful. 

"As such in the interests of procedural fairness and administrative justice, [we]... have decided to refer this matter back to the delegated authority for a complete reassessment of all applications to ensure that the correct scores are now recorded," the letter of March 13, 2018 reads.

In terms of administrative law, a public body cannot review its own decisions.

As soon as a public entity or official arrives at a final decision, it is considered to have discharged its legal obligations and is referred to as functus officio. The only way in which to review such a decision is by approaching the court.

The DEA told News24 that the that functus officio was not applicable in this case but failed to elaborate why it held this belief. 

The Resurging Emerald Front

Fronteras Adventures is the oldest of a trio of Fronteras companies registered in SA. It was established in 2012 as a shelf company, Emerald Panther 119.

The name was subsequently changed to Resurgent Investment Holdings. It finally settled on the name Fronteras Adventures in June 2017, the same month that the permit applications opened.

It is flanked by Fronteras Africa and Fronteras Capital Partners, two companies established in July 2016 and February 2018 respectively. A third company, Fronteras Resources Zimbabwe, is incorporated in Zimbabwe.

Fronteras Africa's website lists it as a "pan African impact investment firm engaged in multiple business sectors in agribusiness, financial services, resources, logistics, manufacturing, real estate and infrastructure". It mentions Fronteras Adventures in a single paragraph on its Portfolio's page.

Directorship deep-dive

An investigation into the directorships of the companies and its related entities quickly raises several familiar names with links to state security circles.

Fronteras Adventures has two active directors listed according to company records, Barry Henry Fraser and Mkhuseleni Collin Mnguni. 

Barry Fraser was the sole director of Fronteras Adventures from July 2013 until July 2017, when Mnguni was appointed as his co-director. He also serves as a director of several companies involved in the provisions of financial services, including Simeka and Regent.

Outside financial circles he is better known as the brother of Arthur Fraser, the former director general of the State Security Agency (SSA).

Arthur Fraser was accused in Jacques Pauw's book The President’s Keepers of running an intelligence operation parallel to the state, and was recently moved from the SSA to the Department of Correctional Services.

This came about after it emerged he attempted to revoke the security clearance of the inspector general tasked with investigating him and the allegations contained in Pauw's book. 

His co-director, Mkhuseleni Mnguni, is a businessman from East London. Neither of the two directors appear to have any prior experience in marine eco-tourism.

Both Barry Fraser and Mnguni serve as directors on Fronteras Africa and Fronteras Capital Partners, although they are joined by two additional directors.

Dumisani Nyoni, a Zimbabwean national, is listed as a co-director of Fronteras Africa and Fronteras Capital partners. He was only appointed as a director 14 February 14, 2018. Nyoni and his brother head several educational NGOs in Zimbabwe in close association with US based NGOs.

Another co-director of Fronteras Capital Partners is Lindani Sigxashe, a South African businessman.

In 2012, former president Jacob Zuma's wife Thandeka Madiba-Zuma named Sigxashe as the co-director on another company that introduced her to Mandisa Mokwena.

Mokewena was herself a SARS official who admitted during her criminal trial that she received payments from the SSA while employed by SARS.

But the links to intelligence circles does not stop there.

Resurgent Risk Management (not to be confused with Fronteras Adventures’ earlier name, Resurgent Investment Holdings) is a separate company co-directed by Barry Fraser and Manala Manzini, another former state security director general.

Manzini was preceded Barry’s brother Arthur Fraser as the director general of the then National Intelligence Agency, and Arthur Fraser co-founded Resurgent Risk Managers before resigning as a director in September 2016, after his appointment as the SSA director general.

Response from Directors

The directors of the various Fronteras companies initially refused to respond to queries, claiming that they were private businessman and not obligated to reply.

They changed tack and responded through their public relations firm, Onyx Media, confirming that they have access to a certified and accredited vessel, as well as the relevant mariners to give effect to the permit.

"With respect to Gansbaai, Fronteras Adventures is supported by a business and operational plan accommodating locally based expertise including skipper, dive-master, crew and industry consultant. The company has secured access to an appropriate vessel with necessary certifications and accreditations.

"Fronteras Adventures applied for two shark-cage diving licenses and one whale-watching license. One shark-cage and one whale-watching license were awarded."

Fronteras management also confirmed the directorship of Fraser, Mnguni and Nyoni, but failed to mention the directorship of the fourth individual, Sigxashe.

"Fronteras Adventures comprises two directors, Barry Fraser and Mkhuseli Mnguni. They are also directors of Fronteras Africa, with Dumisani Nyoni. The companies share the common purpose of advancing African economic development."

Court Challenge

After being informed of their unsuccessful applications, six of the applicants for whale watching permits requested additional information to appeal the decision. After extended delays by the DEA to provide this information, and with deadlines looming, the six approached the court.

Judge Lister Nuku found in their favour, and ordered the DEA to provide the applicants an opportunity to make augmented submissions before finalising the internal appeal process.

Yet on March 13, 2018, the applicants were informed that, notwithstanding the court order, the appeals process has been finalised and they remain unsuccessful.

When questioned on this, the DEA indicated that they could not respond to News24's queries until the matter is either settled or a court order is granted.

Representatives for the applicants have indicated they would pursue the matter further.

* Do you have information for our investigative journalists? Send an email to tips@24.com

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Read more on:    fronteras adventures  |  arthur fraser  |  state capture  |  economy  |  marine life

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