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Business joins the chorus against state capture

Publish date: 20 April 2017
Issue Number: 112
Diary: Legalbrief Forensic
Category: Governance

The fallout from President Jacob Zuma’s midnight Cabinet reshuffle continues to be felt as some of the biggest names in SA business raise their voices against state capture, writes Legalbrief. A BusinessLIVE report says a grouping of SA’s most successful businessmen including the bosses of Vodacom‚ Anglo American‚ Discovery‚ Standard Bank and Investec have announced they cannot stand by any longer without speaking out against ‘state capture’. In full-page advertisements in leading Sunday newspapers‚ Business Leadership SA (BLSA) calls on all elected leaders to stop state capture‚ pointing the finger at Zuma’s ‘irrational’ midnight Cabinet reshuffle and close relationship with a family of businessmen‚ which it did not name. Announcing ‘South Africa is in crisis’‚ the group denounces the propaganda‚ racism and lies to misrepresent the country’s anger with corruption.

Full BusinessLIVE report

Full text of the BLSA advert

While the BLSA advert stopped short of naming the Guptas as the family benefiting from state capture, deputy chairperson Bonang Mohale didn't hold back when he was asked who the group was referring to, according to a Fin24 report. It says on Tuesday BLSA published on its website the advertisement making an urgent appeal to all elected leaders to help reverse corruption and state capture and to restore confidence in the economy. The report says the call comes amid mounting public pressure for Zuma to step down and a looming vote of no confidence to be tabled by opposition parties in Parliament. The report notes that Mohale told SABC News: ‘These are elected leaders, they need to do the right thing to stop state capture, orchestrated by the president, benefiting one family.’ When asked which family he was referring to, Mohale responded: ‘The Guptas.’

Full Fin24 report

Deputy President Cyril Ramaphosa also weighed in again on the issue of state capture. Eyewitness News reports that Ramaphosa said at an Economic Recovery Engagement Dinner organised by the Black Business Council in Sandton last night that the fight against corruption, patronage and state capture by individuals or families will not be compromised. ‘We will not compromise on our fight against corruption, patronage or rank seeking. We will also not allow the institutions of our state to be captured by anyone – be they individuals, be they families who are intent on narrow self-enrichment,’ Ramaphosa is quoted in the report as saying.

Full Eyewitness News report

The SA Communist Party will hold a protest at the headquarters of National Treasury tomorrow (Friday) against corruption, state capture and the abuse of parastatals for private gain. According to a report on The Citizen site, the party said the picket would highlight ‘the need to defend our national sovereignty and sound financial institutions against corporate capture by parasitic and corrupt networks’.

Full report on The Citizen site

The issue of state capture is also taken up in an article on The Conversation site by Steven Friedman, professor of political studies at the University of Johannesburg who notes: ‘The formal economy might find it a lot easier to live with a (partly) captured national treasury than many might imagine. This is bad news for people living in poverty who would then lack friends in high places to resist the capturers.’ Friedman says the appointment of Malusi Gigaba as Finance Minister after the firing of Pravin Gordhan and his deputy, Mcebisi Jonas, is widely seen ‘not as the replacement of one politician by another but as the capture of the Treasury by a faction which is interested not in the health of the economy but in using public money to feed the patronage networks of a connected few’. He says the only plausible reason for Gordhan and Jonas’ removal is their campaign to prevent public resources and state-owned enterprises serving particular private interests.

Full article on The Conversation site

Staying with state capture: A bid by Tokyo Sexwale to have a private legal team delve into state capture claims against Gupta-linked company Trillian Capital Partners has backfired, according to a Mail & Guardian report. Sexwale is the independent non-executive chairperson of Trillian. Investigators appointed by the company are being stonewalled in their efforts to gather information, which was hoped would clear Trillian executives of claims that they had had prior knowledge that Zuma was going to fire former Finance Minister Nhlanhla Nene, and that they had cashed in on it. The M&G says it has established that Trillian, through its lawyers, has refused to hand over the laptop, iPad and telephone of Trillian chief executive Dr Eric Wood. It has also repeatedly failed to comply with requests for information sent to the company by investigators between 17 January and 23 March. Sexwale announced the appointment of senior Advocate Geoff Budlender in November to investigate a string of allegations that put the company and some of its executives at the centre of the damaging state capture scandal. Budlender reportedly told the M&G Trillian had co-operated with his initial request for information in November, but nothing had been forthcoming since. ‘I had that initial information analysed and on 17 January, I requested additional information emanating from that. I have been waiting since then.’ Four other attempts to get information from the company have been unsuccessful. Budlender confirmed he had asked for access to Wood’s laptop, iPad and telephone. Instead, Trillian lawyers said those were not necessary for the investigation – contradicting initial claims that the board-backed investigation would be independent, notes the report.

Full Mail & Guardian report