Absa attacks Public Protector's 'errors of fact'

Absa CEO Maria Ramos has taken on Public Protector Busisiwe Mkhwebane, attacking her controversial report into the Bankorp lifeboat in a 78-page affidavit filed in the Gauteng High Court (Pretoria) yesterday. The remedial action prescribed by Mkhwebane, that the Special Investigating Unit should recover R1.125bn from Absa for apartheid-era assistance to Bankorp, which Absa bought, rested on ‘material errors of fact’, Ramos said in the papers, according to a BusinessLIVE report. ‘We look forward to this case being brought to court. The years of baseless accusations have been unfair and prejudicial to Absa,’ Ramos said. The report says pressure is mounting on Mkhwebane, who this week backtracked on a proposal, in the same report, to change the Reserve Bank’s constitutional mandate. The Reserve Bank, Treasury and Parliament all launched court applications opposing the recommendation as unconstitutional. The Treasury has also applied to have Mkhwebane’s findings about Absa set aside, saying she had disregarded the evidence before her. These sentiments are echoed by Ramos. The Public Protector ‘picks and chooses aspects of various reports before her, deliberately ignoring facts and findings that do not suit her conclusion’, Ramos said. For example, Mkhwebane referenced findings by an independent panel of experts headed by Judge Dennis Davis, but ‘conspicuously omits to mention the conclusion of the Davis panel’. The panel found Absa had paid a higher price for Bankorp that factored in the Reserve Bank lifeboat. The lifeboat helped to offset a portion of Bankorp’s bad debts and did not benefit Absa, Ramos said.

Absa is challenging the Public Protector’s report on several grounds, four of which are listed in a Fin24 report as:

1. The report’s findings and remedial action are based on material errors of fact, including that Absa benefited from SARB financial support and that the SARB assistance did not benefit the public. There is no debt owed by Absa, it insisted.
2. The Public Protector’s process was procedurally flawed and unfair to Absa.
3. The debt that is alleged to be due had prescribed and is therefore not recoverable.
4. The Public Protector has no jurisdiction to investigate the matter.

Mkhwebane found that the government had been duty-bound to ‘implement’ a report by British intelligence firm Ciex into the Bankorp bailout, and that it had been prejudiced both by bailing out Bankorp and then failing to claw back the money. A Mail & Guardian report points out that in a separate challenge to the Bankorp report instituted last week (likely to be consolidated with Absa’s challenge), Finance Minister Malusi Gigaba said Mkhwebane had ‘disregarded’ evidence presented by the Treasury. Gigaba attached a Treasury report – submitted on former Finance Minister Gordhan’s watch – that complained that Mkhwebane had denied it access to evidence and had been unwilling to listen to its side. Like Absa, Gigaba wants Mkhwebane’s ‘findings, conclusions and remedial action’ overturned. That would effectively amount to a finding that Mkhwebane’s first major report as Public Protector was unlawful, opines the M&G.