Millions of rands from the Public Investment Corporation's investment into AYO Technology Solutions went to two companies linked to Iqbal Survé the day after it was listed on the JSE.
Board approval was also only received after the transfers were made.
This is according to AYO Technology Solutions's former Chief Finance Officer, Naahied Gamieldien, who was testifying before the judicial commission of inquiry into the state-run asset manager.
Gamieldien is currently AYO's executive responsible for business transformation. She was subpoenaed to appear before the commission.
The commission is investigating allegations of wrongdoing at the PIC, which manages R2.2trn in investments on behalf of public servants.
AYO listed on the JSE in December 2017, with the PIC subscribing to all its shares at issue for R4.3bn.
Gamieldien, who was AYO's CFO until January 2019, told the inquiry that the day after AYO listed, she received a call instructing her to transfer R70m in funds out of AYO's bank account.
'I realise I erred'
"I was instructed telephonically by [Khalid] Abdulla to transfer R35m to 3 Laws Capital and a further R35m to Sekunjalo Capital," she said.
Abdulla is the CEO of African Equity Empowerment Investments, the majority shareholder in AYO. AEEI falls under Sekunjalo, which has Survé as its executive chair.
3 Laws Capital is an investment management company linked to Survé.
Gamieldien said she asked Abdulla to send her this request in writing as she thought it would require board approval. She said she subsequently received an email with bank details, and she made the payment, saying Abdulla was "adamant" it be made.
"In retrospect I realise that I erred in making the payments," she said.
The payments were subsequently ratified by AYO's board as investments, with a change that the full amount of R70m go to 3 Laws Capital.
Gamieldien said the reason for the transfer was to diversify AYO's cash holdings.
Later another R400m was invested in 3 Laws Capital.
Testifying before the inquiry in early April, Survé had said the PIC's investment in AYO was sound. He blamed the white business establishment and rivals for running a campaign of misinformation against his companies.
He also said that all funds invested in 3 Laws Capital had been paid back and the mandate terminated because of "media hype".
"I advised the chair, the CEO of 3 Laws that he must please repay that money back to AYO even though it’s AYO’s money it was in the 3 Laws account and that’s been repaid along with the interest," he said on April 3.
On Wednesday Gamieldien said she met with Abdulla at his house to walk him through the interim financial results. As the group's profit margin was lower than normal, she said Abdullah asked to see what the data would look like at a higher rate.
She said the was "uncomfortable" with the request and was not sure what the intent of the exchange was. She subsequently travelled to Port Elizabeth to be with her ill father, and handed over the finalisation of the interim financial results to another employee.
The matter is now being investigated by the JSE.