North west Intervention: NPA briefing

Meeting report

The Chairperson welcomed Members, and the delegation from the National Prosecuting Authority (NPA).

The delegation from the NPA consisted of AdvShamila Batohi, National Director of Public Prosecutions; Adv Rodney de Kock, Deputy National Director of Public Prosecutions: National Prosecutions Service; Adv Ouma Rabaji-Rasethaba, Deputy National Director of Public Prosecutions, Asset Forfeiture Unit (AFF); and Adv Lebogang Dineo Baloyi, Special Director of Public Prosecutions, Specialised Commercial Crimes Unit (SCCU).

The purpose of this virtual meeting was for the NPA to brief the Committee on the progress of investigations relating to the Section 100 Intervention in the North West province. It deals with investigations being conducted by the AFU and the SCCU, within the NPA.

Briefing by the NPA on investigations relating to the Section 100 Intervention

Adv Batohi, the National Director of Public Prosecutions, presented the briefing to Members.

Introduction and the mandate of the NPA

The duties and powers of the NPA are outlined in the Constitution and include the institution and conducting of criminal proceedings on behalf of the South African government; to conduct any necessary functions incidental to instituting and conducting such proceedings; and the power to discontinue any criminal proceeding for good reason. The Investigating Directorate of the NPA’s mandate is dealt with separately by legislation. The NPA has the vital responsibility of providing a coordinated prosecuting service which ensures justice is delivered to the victims of crime, the removal of profits from crime, and the protection of certain crucial witnesses aiding in the administration of justice.

The mandate of the SCCU is to guide criminal investigations, and conduct the prosecution of complex commercial crime cases emanating from the commercial crime branches of the South African Police Services (SAPS). The mandate of the AFU is to seize assets acquired as the result of the proceeds of crime.

The SCCU in the North West province was understaffed until March 2020, as it only consisted of one Deputy Director of Public Prosecutions, and two Senior State Advocates, who were tasked to deal with all the complex commercial cases in the province. However, the SCCU has since been capacitated through the permanent appointment of four advocates, and five additional advocates who were appointed on a contractual basis. The creation of a further five posts for advocates are under consideration. The Deputy Director of Public Prosecutions was suspended in early March 2021 because of allegations of shoplifting, and the NPA has since appointed a second Deputy Director of Public Prosecutions to fill the post.

Overview of the NPA’s investigations relating to the Section 100 Intervention

It was reported the NPA currently has 51 cases under investigation which relates to the Section 100 Intervention in the North West province. Out of these 51 cases, 13 matters are in court, 13 matters must still be decided by the NPA, and nine matters are under investigation. A total of 16 matters have been finalised, with five convictions, and one acquittal, as the outcomes of the criminal proceedings. The total value of the investigations currently being investigated amount to R 2.3bn.

Update on investigations (the SCCU):

The SCCU is dealing with 11 cases from before the Section 100 Intervention, which emanated from the North West’s provincial governments, and a further nine cases since 2018. The SCCU provided the Committee with a breakdown of the cases it was dealing with, including information relating to the case number, the provincial department implicated, a brief description of the nature of the case, the level of persons implicated in the investigation, if irregular expenditure was alleged, if the cases involved expenditure relating to the COVID-19 pandemic, and the current statuses of the cases.

The breakdown of cases from before the Section 100 Intervention included:

-The Mmabatho-case (with case number 140/03/2017) where the charges were fraud to the value of R 420 000. This matter involved a supply-chain management official of the Provincial Department of Social Development, who facilitated payments to service providers for fraudulent tenders. There was no irregular or COVID-19 related expenditure reported in this investigation. The matter is currently still under investigation.

-The Mahikeng-case (with case number 369/06/2017) where the charges were fraud with a value which must still be determined. This matter involved a management official of the Provincial Department of Local Government and Human Settlements. It was alleged members of the North West Housing Corporation, a law firm, and members of the Registrar of Deeds colluded to unlawfully facilitate the transfer of fixed properties to a private individual. There was no irregular or COVID-19 related expenditure reported in this investigation. The matter is still under investigation.

The breakdown of cases since the Section 100 Intervention included the following:

-The Morokweng-case (with case number 23/12/2018) where the charges were fraud to the value of R121 000. This matter involved allegations concerning the Provincial Department of Social Development. It appeared it funded a non government organisation (NGO), to sustain its projects, which funds were intended to uplift the community, but was instead misused. There was no irregular or COVID-19 related expenditure reported in this investigation. The matter is currently still under investigation.

-The Mmabatho-case (with case number 448/11/2019) where the charges were corruption to the value of R2.5 million. This matter involved the Director of the Provincial Department of Tourism, who appointed a contractor to do renovations at the Taung Hotel School, and corruption which took place during the appointment process, amounting to irregular expenditure. There was no COVID-19 related expenditure reported in this investigation. The decision to decline to prosecute was taken by the NPA because the service was in fact rendered, and there was not any evidence to sustain the charges of fraud and corruption.

The NPA said these cases involved senior or top-level managerial officials, and the offences involved were of similar nature, such as fraud, corruption, and abuse of the supply-chain management procedure, a disregard for applicable legislation, and a disregard for governmental prescripts and protocols in place. Regarding the Prosecution Policy of the NPA, it was confirmed, cases finalised by the former head of the NPA can be reviewed and taken back to the courts. The review of a case is a continuous process, and prosecutors must consider any relevant circumstances and new facts which become known, even after an initial decision was made regarding prosecution.

Regarding the challenges hindering the finalisation of cases, the NPA cited the following challenges: resources are not always available, problems emanating from provincial departments with implicated staff members and the consequential hindering of the authorisation for the forensic audits. In some matters, the forensic investigations are commissioned by the heads of departments (HODs), with the NPA having little or no input into the scope of the investigations. This leads to the forensic reports contributing little to the processes of criminal prosecution, which necessitates the extension of the auditor’s appointment. There are no upfront agreements compelling the forensic auditors to testify in subsequent criminal trials. The law enforcement agencies involved, such as the South African Police Services (SAPS), and the Directorate for Priority Crime Investigation (DPCI), have significant resource constraints which is being addressed. However, it continues to have a direct impact on the quality and duration of investigations.

Remedial measures have been undertaken to resolve the technical aspects of the cases referred, which do not meet the criteria for prosecution. The SCCU works in close collaboration with the investigating authorities, and case plans are compiled in each individual case. Ongoing assessments of evidence are implemented, and guidance is provided throughout the investigation process. It is important to note, prosecutors do not lead investigations, but act in a guiding authority. It is within the legislative mandate of the DPCI and the SAPS to investigate criminal misconduct.

Update on investigations (the AFU)

The NPA said the details of the AFU’s current investigations would not be disclosed to the Committee due to the nature of the investigations and dissipation of assets. The AFU has no permanent staff structure within the North West province, but the process of filling three permanent positions is underway. The AFU in Pretoria is currently responsible for the handling of all investigations relating to the Section 100 Intervention in the North West province. The capacity of the AFU in Pretoria is being expanded. The establishment of an AFU office in the North West is being considered. This will ensure the rapid referral of new matters and strengthen stakeholder relations.  

In July 2020, the AFU office in Pretoria commenced investigations regarding certain matters pertaining to the Section 100 Intervention in the North West province. Prior to July 2020, a select number of these matters were dealt with by other AFU offices. From July to September 2020, contractually appointed financial investigators were appointed to specifically assist with these cases. The AFU relies on the forensic audit reports obtained from the National Treasury, the investigations by the DPCI, and further investigations by the AFU’s internal financial investigators.

The majority of matters considered by the AFU are still being investigated or awaiting decision to prosecute. National Treasury has identified nine matters with the potential for asset forfeiture, and a further seven cases from the SCCU are being considered. This includes:

-The Provincial Department of Human Settlements: The AFU has obtained a preservation order, and a forfeiture application is pending in the North West High Court to the value of R80 million.

-The Provincial Department of Public Works and Roads: No referral has been received in either of the two matters pertaining to this government department, and the matter is under investigation.

The NPA said there is a pattern in these cases. It involves primarily senior or top-level managerial officials, and the offences involved are of a similar nature. Three matters have been finalised, and established time frames have been set for the finalisation of the remaining matters. Matters sourced from the SCCU are criminal forfeiture related. Criminal forfeiture matters are dependent on the finalisation of a criminal trial with conviction of the accused. Projections are therefore made subject to the 2021/22 fiscal year, and possible criminal forfeiture recovery.

The NPA reported that there are three main challenges hindering the finalisation of the cases under the attention of the AFU. This includes the complexity of matters which are time-consuming, the limitations of civil forfeiture recoveries and the finalisation of cases, the dependency of criminal forfeiture recoveries on the successful investigations of criminal matters, and the limited capacity of the AFU in the North West.

The AFU will attempt to finalise a number of asset forfeiture applications in the 2021/22 fiscal year. The NPA cannot, at this stage, comment on the projected value of recoveries. The AFU has not yet been able to quantify the total amount of the loss suffered as a result of corrupt practices and maladministration. Regarding this, the AFU will rely on the information collected by other law enforcement agencies.

Concluding remarks by the NPA
Adv Batohi said the work relating to the North West province is enormous, and it requires a lot of arduous work to be done. It is paramount for the SCCU and the AFU to be further capacitated in the North West province, to ensure investigations are finalised. The limited capacities of the SAPS and the DPCI continues to heavily impact the criminal cases referred to the NPA. The weaknesses across the criminal justice system are interlinked and plays a significant role in the NPA’s capabilities.

For the full presentation, see attached documents

Discussion
The Chairperson thanked the NPA for the comprehensive briefing. He said Members would engage with the information provided, as the situation in the North West requires immediate attention. The Committee needs to discuss the manner in which South Africa can proceed as a country in dealing with issues of corruption and maladministration.

Mr S du Toit (FF+, North West) appreciated the briefing by the NPA and thanked the delegation for the challenging work put into the investigations relating to the Section 100 Intervention in the North West province. He referred to the Member of Executive Committee (MEC) of Agriculture’s previous mention of the challenges, with cases being reported to the Hawks which are not investigated. It seems as if the Provincial Department of Rural Economic and Agricultural Development of the North West is being told disciplinary routes must be followed, rather than looking into the alleged fraudulent activities. He asked the NPA for guidance as to how such cases must be managed, and asked for clarity on this issue previously raised with the Committee.

Mr D Ryder (DA, Gauteng) said he remains concerned with the small percentage of investigations finalised, compared to the larger number of ongoing investigations. He asked about the level of cooperation the NPA receives, relating to investigations, from municipal officials. It seems as if the NPA is being stonewalled by the closing of the ranks, or by the effect on politically connected wrongdoers.

Mr S Zandamela (EFF, Mpumalanga) noted concern about the lack of cooperation or efficient communication between law enforcement agencies, specifically regarding the situation in the North West province. The Committee seems to be receiving different reports from the law enforcement agency and the North West’s Standing Committee on Public Accounts (SCOPA). There is a need for collaboration and joint effort between these structures to ensure success of the Section 100 Intervention in the province.

Mr I Sileku (DA, Western Cape) appreciated the briefing by the NPA. He said only charging officials was not sufficient, as the provincial departments affected had political leaders at the time the alleged crimes were committed, including the Office of the Premier. It is concerning to see these political principals are not included in the investigations, which only focuses on administrators. He asked how often the NPA engages with the provincial departments in the North West, and the oversight bodies such as SCOPA; he asked what level of cooperation the NPA was receiving, related to the investigations.

Mr E Nchabeleng (ANC, Limpopo) said when the Committee met with the SCOPA earlier, the Committee raised issues about whistle-blowers who were not interviewed by the South African Police System (SAPS). He asked if the NPA is aware of this issue, and what is being done to remedy the situation to improve the outcomes of investigations.

Ms Z Ncitha (ANC, Eastern Cape) appreciated the briefing by the NPA. She said the Committee met with the different stakeholders prior to this meeting with the NPA. The common concern of all the stakeholders was the level of frustration relating to the law enforcement agencies, and the stagnant consequence management, especially in relation to criminal prosecution. She appreciated the step in the right direction, which the NPA took by working towards capacitating its offices in the North West province.

The Chairperson said the presentation by the NPA inspires confidence in the complex work the NPA does. The goal of the NPA remains to prosecute all criminal activity without fear, favour, or prejudice. The Committee supports the NPA and other law enforcement agencies which seek to restore order in the North West province. South Africa cannot afford to allow a situation where government officials plumb the resources of the State. He agreed with Mr Nchabeleng’s concerns relating to the whistle-blowers who are in need of protection, and the need for interviewing by the SAPS. Doing so will go a long way in ensuring whistle-blowers can disclose all the information at the whistle blower’s disposal, which can then be used in the investigations by the law enforcement agencies. Given the cases where previous ‘corruption busters’ or whistle-blowers in the Province disappeared, it is reasonable to expect whistle-blowers will withhold information out of fear of retribution. The crux of the matter is the North West province is going down the drain, and those responsible must be held accountable and subjected to consequences. It seems as if the law enforcement agencies act in isolation.

Responses by the NPA
Adv Lebogang Dineo Baloyi, Special Director of Public Prosecutions: Specialised Commercial Crimes Unit (SCCU), NPA, said the NPA welcomes the support from the Committee. The NPA is committed to ensuring the work which must be done is finalised, in alignment with the partnerships forged with other law enforcement agencies. The dynamics of the law enforcement agencies and the tendency to work in isolation must be repaired at a leadership level. The NPA continues to work towards strengthening the structures of communication and cooperation between the law enforcement agencies, to identify the priority cases throughout the country. The NPA pursues all implicated by the evidence available, which requires an objective assessment of the available evidence. On the questions relating to the whistle-blowers, he said the NPA is very mindful of the challenges the situation poses. It is exploring the possibilities of collaboration with the Department of Public Services and Administration, and other relevant governmental entities. The object is to amend the legislation to make it easier for whistle-blowers to disclose the information at whistle blower’s disposal. The NPA is working with other law enforcement agencies to ensure, when needed, whistle-blowers can obtain the necessary protection.

Mr Wessel van Biljon, Deputy Director of Public Prosecutions: National, NPA, said the NPA does not have investigative capacity, so the entity will not necessarily be aware of all the cases reported to the SAPS. Regarding the comment of the NPA being stonewalled by a lack of cooperation from government departments and officials, he said it differs on a case-by-case basis. Generally, there is a good working relationship between the NPA and the governmental departments, but this is hindered when there are officials from the provincial departments who are implicated.

Adv Batohi said the NPA pursues all wrongdoers implicated, by the evidence available. The NPA does not target individuals, but follows the evidence in a way which is not politically affiliated. The NPA’s task is to ensure those who plundered the resources of the government are held accountable, regardless of the political spectrum the person belongs to. It was a proven tactic, to get the big fish one has to fry the sardine first.

On the issue of building cases, she said it is exceedingly difficult to identify the higher officials who are responsible, immediately. It requires the formal accusation of those officials at the lower levels, who are then brought to court and given the incentives of becoming whistle-blowers against powerful, rich people. Another stumbling block is the legislative disjoint which links the NPA to the Special Investigating Unit (SIU). As things stand, the fact the SIU does not have a criminal focus in its investigations, and is referring cases to the NPA, is not helpful in the process of finalising the matters.

When cases are referred to the NPA by the SIU, the cases have to be referred to the Hawks to open a docket, and for further investigation. The majority of the cases referred by the SIU are not ready for criminal prosecution. Investigation deficiencies make it harder for the NPA to be confident of successful prosecutions if the cases are taken to court. It is a source of frustration for the NPA to be joined at the hip with the Directorate for Priority Crime Investigation (DPCI). The DPCI is already struggling with a lack of capacity. The work which is done by the NPA and the DPCI amounts to either joint success or joint failure.

The Chairperson said the work of the Committee, regarding its mandate from Parliament, is to report back to the National Assembly by 26 March 2021. Members worked tirelessly to deal with the issues relating to the North West province. The Committee will present its report to Parliament, which will also outline the recommendations made. It is clear there must be a special focus on the reinforcement of the capabilities of the law enforcement agencies. He agreed with Adv Batohi that it is crucial for accountability measures to be enforced, together with consequence management. He thanked the delegation from the NPA for the information presented, and the engagements with the Committee.

The meeting was adjourned.