Deputy finance minister linked to Prasa malfeasance

accreditation
Sfiso Buthelezi (File)
Sfiso Buthelezi (File)

Johannesburg - New deputy finance minister Sfiso Buthelezi was linked to possible financial irregularities in former Public Protector Thuli Madonsela’s 2015 report on the Passenger Rail Agency of South Africa (Prasa).

Buthelezi previously held the position of Prasa chairperson until he was replaced by Popo Molefe in 2014.

Derailed, Madonsela’s damning report on the troubled state-owned rail transport entity, contains allegations that a company of which Buthelezi was a shareholder and a director clinched an advisory services contract from Prasa while Buthelezi led Prasa’s board.

According to the report, however, Madonsela could not make any conclusive findings on the allegations because former Prasa CEO Lucky Montana failed to provide her with key documents related to the allegations.

Buthelezi held shares in Cadiz Holdings and Makana Investment Corporation, according to an “undated” declaration of interests form included in the Derailed report. Buthelezi was also a director of the latter company. Makana is a subsidiary of Cadiz.

Contract

According to information provided to Madonsela, Cadiz Holdings secured a contract to provide advisory services to Prasa on the state-owned company’s huge tender for new passenger carriages worth R51 billion.

Madonsela set out to determine whether Buthelezi “improperly fail[ed] to disclose and manage a conflict of interest arising from his interest in Makana, a subsidiary of Cadiz, a company allegedly providing advisory services to Prasa on the Rolling Stock Programme”.

However, she did not receive the documents she needed to probe the claims.

“The documents have not been provided by Prasa, whose GCEO (Montana) only offered an explanation disputing the allegation and providing names of companies involved in the said advisory services. Accordingly, I have deferred my findings on this allegation and [it] will be dealt with in the second report,” she wrote.

Madonsela’s much-anticipated second report on Prasa’s disastrous financial affairs under Montana’s leadership could not be completed before she made way for Public Protector Busisiwe Mkhebane in October 2016.

Letter

According to the report, Montana at the time wrote a letter in which he denied that Prasa had awarded an advisory contract to Cadiz.

“Prasa argued that the allegation that Cadiz is providing advice on the new Rolling Stock Project is not only false but also dangerous as it jeopardises an important process in the upgrading of passenger rail services and the creation of job opportunities within South Africa,” reads Madonsela’s report.

According to CIPC records, Buthelezi resigned as a director of Cadiz Holdings in November 2010. He only resigned as a director of Makana Investment Corporation in August 2016.

The report states that Buthelezi was a “senior executive at Makana Investment Corporation, which is owned by the Makana Trust, which belongs to former political prisoners in South Africa”.

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

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24
Lockdown For
DAYS
HRS
MINS
Voting Booth
Facebook is facing a fresh crisis after a former employee turned whistle-blower leaked internal company research. Do you still use Facebook?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes, the benefits outweigh the risk for me
32% - 1793 votes
No, I have deleted it
38% - 2100 votes
Yes, but I am considering deleting it
30% - 1650 votes
Vote
Rand - Dollar
14.51
+1.7%
Rand - Pound
19.88
+0.9%
Rand - Euro
16.83
+0.6%
Rand - Aus dollar
10.77
+0.6%
Rand - Yen
0.13
+0.7%
Gold
1,767.60
0.0%
Silver
23.31
0.0%
Palladium
2,075.53
0.0%
Platinum
1,059.00
0.0%
Brent Crude
84.86
+1.0%
Top 40
60,494
+0.2%
All Share
67,029
+0.3%
Resource 10
64,347
-0.1%
Industrial 25
84,819
+0.7%
Financial 15
13,961
-0.3%
All JSE data delayed by at least 15 minutes Iress logo
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE