Suspensions are on the cards from as early as next week for senior Transnet executives named in three reports on state capture.
City Press has learnt that, after two reports – by corporate law firm Werksmans and Mncedisi Ndlovu & Sedumedi (MNS) Attorneys – on the controversial 1 064 Transnet locomotives tender, a disciplinary committee set up by the Transnet board has named five of its senior officials for possible suspension.
Current group chief executive officer (CEO) Siyabonga Gama and Transnet Engineering chief executive Thamsanqa Jiyane, as well as former supply chain manager Lindiwe Mdletshe, Transnet Group Treasury official Danie Smit and executive finance manager Yousuf Laher will be asked to give reasons why they should not be suspended.
The impending disciplinary action is based on the MNS report, which also recommends that the entire deal – which rocketed in price to R54.5bn from R38.6bn – be cancelled.
The locomotives tender saw Gupta-linked companies score more than R5bn in kickbacks.
Sources within the Transnet board and the department of public enterprises said the executives would receive their letters this week.
“They will have to give reasons why they should not be suspended, pending disciplinary hearings into their roles in the awarding of the multibillion-rand locomotive deal,” said a source.
Transnet spokesperson Molatwane Likhethe said: “Transnet has no knowledge of the mentioned and pre-empted events.”
Jiyane’s lawyer Nicqui Galaktiou said he had “no knowledge of the allegation of Transnet’s intention to suspend him”, and that he learnt from Gama that “the board denies all knowledge of these allegations and denies that such a process is imminent or has been implemented”.
“Mr Jiyane would embrace the opportunity to have the issues ventilated in an unbiased and fair process that will be comprehensive and consider all the relevant evidence available which was overlooked in the reports with a view to putting an end to all the speculation and innuendo,” she said, adding that City Press’s sources had ulterior motives in “leaking false information”.
At the time the locomotives contracts were signed, Brian Molefe was group CEO of Transnet, Gama was the chief executive of Transnet Freight Rail (TFR) and Jiyane was TFR’s chief procurement officer.
City Press has learnt that Transnet had engaged one senior and one junior counsel, both experts in labour law, to formulate the disciplinary charges against the executives. Another senior and junior counsel, who are experts in commercial law, have been engaged to work on cancelling the locomotives deals.
Three sources told City Press that MNS Attorneys has been appointed to conduct the disciplinary hearings. However, MNS chairperson Mncedisi Ndlovu could not be reached for comment.
The MNS report also recommended that Transnet lay criminal charges against Molefe, his former chief financial officer Anoj Singh, board subcommittee chairperson Iqbal Sharma and Gupta lieutenant Salim Essa. It also recommended that Transnet pursue Molefe to repay money that Transnet lost because of the deal.
It further recommended that Gama be disciplined for “being part of the team ... that misrepresented the true reasons and extent of the increase of the initial contract value” to the board; for “failing to exercise reasonable care and skill”; and for “failing to properly manage his subordinates, who compromised the fairness of the procurement process”.
Jiyane, it found, should be disciplined for allegedly contravening Treasury regulations and failing to ensure that the tender process was above board.
Hawks hit a snag
Meanwhile, the Hawks’ probe into state capture has hit a snag, with investigators saying there will be no high-profile arrest until they secure more evidence from the United Arab Emirates and India.
Senior Hawks officials told City Press this week that applications for mutual legal assistance from the two countries – submitted by the National Prosecuting Authority’s Specialised Commercial Crimes Unit, as well as by the Asset Forfeiture Unit – are yet to receive evidence from the two countries.
The requests include details of bank accounts and deposits held in those countries by Gupta family members, Duduzane Zuma, former mineral resources minister Mosebenzi Zwane and other key actors.
“It might take some time as our mutual legal assistance requests are dealt with. In the absence of that, it will be difficult to make any high-profile arrests,” said a source within the investigation.
“For example, we are still struggling to establish the financial benefits to politicians, if any, in their offshore accounts.”
In the case being built against Zwane, prosecutors have been trying to establish how much was paid to him and his gospel choir during the music tour they undertook to India in October 2012.
“We are deeming the payment as a bribe, as it also came shortly after the awarding of the Estina project [from which the Guptas and their lieutenants alleged syphoned off R250m from the Free State department of agriculture] to a Gupta-linked company,” said another source.
Zwane could not be reached for comment.* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER