- Free State Human Settlements HOD Nthimotse Mokhesi entered into a trust to own a residential property with Blackhead CEO Edwin Sodi after a dodgy asbestos contract between the company and his department.
- He said he didn't see anything wrong at the time, but Deputy Chief Justice Raymond Zondo wasn't convinced by his arguments.
- Mokhesi's counsel, Dali Mpofu SC, objected to questions which would incriminate his client.
The head of the Free State Department of Human Settlements Nthimotse Mokhesi entered into a trust to purchase a residential property with a contractor of his department, while the department still paid for a contract which was declared invalid by the Auditor-General.
Mokhesi told the Judicial Commission of Inquiry into Allegations of State Capture on Monday, that at the time, he didn't see anything ethically wrong with this.
Mokhesi was called back to the commission after he testified last month and conceded that they did not follow correct processes when they considered a proposal for an asbestos audit project.
A joint venture between Edwin Sodi's engineering consultancy firm Blackhead Consulting and the late Ignatius "Igo" Mpambani's Diamond Hill Trading 71 secured the R255 million contract in 2014.
Sodi had also appeared before the commission and conceded that his company didn't have the required clearance.
On Monday, commission evidence leader advocate Paul Pretorius SC probed Mokhesi on an agreement he entered into with Blackhead.
Unable to obtain a full home loan from banks due to a South African Revenue Service ruling against him, Mokhesi first approached friends and family for help to purchase a house in Bloemfontein when he heard that Sodi was also involved in the property market, he told the commission.
He and Sodi agreed to enter into a trust to purchase the residential property and signed the agreement before the trust was established.
Mokhesi said although it wasn't his "primary residence", he did stay in the property and didn't pay rent.
Pretorius wanted to know why Sodi didn't register the property in his name and gave up his rights to the property.
Mokhesi's counsel, advocate Dali Mpofu objected, saying Pretorius was now "establishing an element of a crime".
Deputy Chief Justice Raymond Zondo said it appeared that Sodi didn't care much about his R650 000 stake in the property and asked whether he was perhaps assisting Mokhesi. Again, Mpofu objected.
Pretorius pointed out that at that time, the department still paid Blackhead, despite the Auditor-General's finding that the contract was invalid.
"As head of department, was it right for you to enter into this agreement?" Pretorius asked.
Again, Mpofu objected. He said it was "quite unfair" to expect Mokhesi to answer whether he was culpable.
Zondo said Mokhesi should answer from an ethical, instead of a legal, point of view.
"Well, this was a commercial transaction, honourable chairperson," Mokhesi answered. "The individual could either say yes or no."
After Zondo repeated the question, and a long pause and some stammering from Mokhesi, he added that the agreement was entered into after the irregularities with the asbestos contract had been known.
Zondo said he got the impression from his answer that he agreed that it would not be ethical.
"Maybe in hindsight. Maybe I shouldn't have," Mokhesi answered. Zondo asked if he saw nothing wrong at the time.
Mokhesi said yes, because it was a "commercial transaction" and because he disclosed his trusteeship.
"That reason, Mr Mokhesi, doesn't sound convincing to me," Zondo said.
"Chair, I appreciate where you're coming from," Mokhesi replied. "I had no intention of hiding that transaction."
Zondo said he had difficulty accepting Mokhesi's reasons.
Pretorius said other evidence before the commission suggested that payments could be disguised.
Zondo drew a parallel between Mokhesi's testimony and that of former ANC MP Vincent Smith, who testified that a loan from Bosasa's Angelo Agrizzi was paid into the account of his business. Smith declared his business interest to Parliament.
Recently, Public Protector Busisiwe Mkhwebane also found that the asbestos contract was irregular. Mpofu said Mokhesi doesn't dispute any of the Public Protector findings.
Previously, former Free State Economic Development MEC Mxolisi Dukwana testified that government officials, including the province's former premier, ANC secretary-general Ace Magashule, received kickbacks for helping to facilitate the asbestos contract.
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