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In less than three days, the National Prosecuting Authority (NPA) has done a series of about-turns in a controversial case that concerns Transnet’s acting CEO, Siyabonga Gama.
On Thursday, NPA spokesperson Luvuyo Mfaku confirmed to City Press that the NPA was reconsidering the decision not to prosecute Gama for his role in awarding a questionable R95 million security tender.
But yesterday, during an urgent application to interdict City Press, Gama’s lawyers produced a letter from Mfaku saying: “We confirm that at this stage there is no evidence that links Mr Siyabonga Gama to any acts of criminality. There is no basis for the review of the matter.”
Gama’s lawyers then asked Judge Colin Lamont to interdict City Press from publishing any story that would claim Gama was under investigation.
They asked Judge Lamont to order City Press to “cease and desist from publishing in its newspaper an article regarding the alleged investigation and reinstatement of criminal charges against me”.
Lamont refused to grant the interdict, and allowed City Press to publish the article after a few minor changes were negotiated with Gama’s lawyers.
However, while the interdict application was under way, Mfaku sent an SMS to City Press reporter Abram Mashego at 1.13pm that once again cast doubt on the NPA’s resolve to drop the matter entirely: “The NPA is considering the matter. However, it is highly unlikely that any person would be prosecuted on the basis of the information at our disposal.”
The investigation dates back to 2010, when Gama was dismissed from Transnet. He was reinstated a year later. Now, as he is poised to finally seize Transnet’s top job, the case that once threatened to derail his career has come back to haunt him.
Meanwhile, the Public Protector’s office has launched its own investigation into “unlawful conduct” at Transnet, including allegations of “corruption, abuse of power, [and] victimisation of employees”.
The NPA initially declined to prosecute the case last year, saying there were “no reasonable prospects of a successful prosecution” because the main suspect in the case, a former Transnet employee, Dingaan Senamela, had died.
After City Press approached Gama for comment, Gama’s lawyer, Themba Langa, claimed City Press was “desperately trying to defame the reputation of Mr Gama”, accusing the journalists involved of “telling lies”.
The tender at the centre of the investigation was awarded to a company once owned by former communications minister and chief of the SA National Defence Force Siphiwe Nyanda.
In 2010, Transnet’s forensic manager, Karthi Naicker, laid a complaint at the Johannesburg Central Police Station asking for a corruption investigation of various Transnet employees.
The allegations date back to 2007 when Gama, as CEO of Transnet Freight Rail, signed off on an R18.9 million tender to fight cable theft that was awarded to a little-known security company, General Nyanda Security (GNS), of which Nyanda was a director. By 2010, with additional contracts and extensions, the initial R18.9 million contract had ballooned to R95 million.
Although Gama was never implicated in corruption and only accused of signing off on the tender in contravention of the Public Finance and Management Act (PFMA), he was one of several Transnet employees dismissed in 2010.
But following another Transnet investigation, the board decided to reinstate Gama, saying: “The sanction of a dismissal was too harsh and therefore the board considered a final written warning to be more appropriate.”
But since then, a parallel process has been running – Gama has been re-establishing himself as the heir apparent to Brian Molefe, who was Transnet CEO until being appointed acting CEO of Eskom.
The police have also continued their investigation and Transnet has been pursuing a civil claim against General Nyanda Security to try to reclaim part of the R95 million the company was paid.
Inside the case
The investigating officer’s diary, a copy of which City Press has seen, shows that between 2010 and 2013, the criminal case was given almost weekly attention by members of the Hawks’ anti-corruption task team, the asset forfeiture unit and the Special Investigating Unit brought in to assist.
The charges investigated included fraud, corruption, money laundering and contraventions of the PFMA.
By the time the case was handed over to the NPA for a decision, witness statements “in excess of 45” had been obtained, and bank statements had been “analysed by experts and suspicious transactions found”, including a R200 000 payment made by a company belonging to one of the GNS directors to Langa Attorneys, Gama’s lawyer’s firm.
A summary of the police’s case says the investigating officer believed this payment “was to cover legal costs for Transnet CEO Mr S Gama”, and may constitute “corruption”.
When Langa was asked for comment, he threatened to sue the journalist, City Press and News24 if the allegation was printed.
It appears that after the case was handed over to the NPA in February 2013, everything went quiet.
The next entry in the investigation diary comes more than a year later, on March 10 2014: “Decline to prosecute any of the suspects mentioned in the docket. There is, at this stage, no reasonable prospect of a successful prosecution as a result of the passing away of [Transnet’s former manager of security] Mr Dingaan Senamela, who was at all material times the main suspect around whom the whole case revolved ... [signed] Advocate G Nkoana [deputy director of public prosecutions].”
Transnet’s secret settlement
Shortly after the NPA declined to prosecute, Transnet announced it was dropping its civil claim against GNS.
In August last year they announced they were withdrawing all the cases against the security company, saying: “Transnet found no evidence of wrongdoing by [General Nyanda Security] and its founder General Siphiwe Nyanda (retired). Transnet regrets any harm that may have been caused by the handling of the matter.”
Although the settlement details remained secret, Transnet said both companies agreed to withdraw all claims and cases against each other. When City Press approached Transnet for comment in June, its spokesperson, Mboniso Sigonyela, said: “As far as Transnet is concerned, the matter between the company and GNS is closed.
“In 2011, when the Transnet board of directors decided to reinstate [Gama], they specifically stated that there had been no corruption or dishonesty committed by Mr Gama in the award and that there had been no breach of our ethics policies,” added Sigonyela.
He said that Transnet had, “through an independent firm of attorneys, conducted a vigorous and exhaustive investigation ... the probe found that Transnet derived full benefit from the amounts incurred on all contracts with GNS and that Transnet found no evidence of wrongdoing by GNS or any officials. As a result, Transnet has moved on.”
But there appear to be conflicting views within the NPA about whether the correct decision was made.
Last June, a Johannesburg lawyer wrote to former prosecutions head Advocate Mxolisi Nxasana to ask for information about the outcome of the police investigation.
Although Nxasana initially struggled to locate the docket, in March he replied, saying he had found the docket and was taking a second look at the NPA’s decision not to prosecute.
Nxasana wrote in an email: “The docket comprises about 10 lever arch files, but I can confirm that one of the suspects therein is Mr Siyabonga Gama.
“I have decided to relook at the matter and it may take quite some time before I finish going through the docket, but I can assure you that the matter is receiving urgent attention.”
An internal NPA memo from March shows that Nxasana referred the case to three of the NPA’s top brass – deputy national director of public prosecutions Advocate Nomvula Mokhatla, head of the specialised commercial crimes unit Advocate Lawrence Mwrebi, and south Gauteng director of public prosecutions Advocate Andrew Chauke – for a decision.
The memo states: “The matter apparently involves the senior officials of Transnet Freight Rail, a division of Transnet, including its chief executive, Mr Siyabonga Gama, who are alleged to have contravened the provisions of the Prevention and Combating of Corrupt Activities Act No 12 of 2004, as well as fraud and money laundering. Let me know as soon as you have made a decision.”
After Nxasana’s resignation on May 31, City Press approached his replacement, Advocate Shaun Abrahams. The NPA then confirmed that they were still re-examining the case and the decision not to prosecute any of those involved.
But Gama denied this, saying in court papers filed late on Friday that, in a discussion with his attorney, Abrahams said “the decision not to prosecute remains the official position of the NPA”.
Public Protector gets involved
In his bid to finally be appointed Transnet CEO, Gama faces yet another hurdle.
In July, City Press reported on the draft findings of a PricewaterhouseCoopers (PwC) investigation into allegations of various irregularities at Transnet Freight Rail (TFR) – the division that until recently Gama had headed as CEO – including allegations that staff members were intimidated and targeted for raising questions about lucrative settlements and tenders.
Although the auditing firm found that the specific allegations made against Gama were baseless, its investigation found evidence of wide-ranging irregularities at TFR, all of which happened under Gama’s watch.
PwC’s investigation was due to be finalised in June, but City Press learnt this week its report is still outstanding. Asked whether PwC’s scope had been expanded to include new allegations, both PwC and Transnet failed to provide comment.
This week City Press also established that the Public Protector launched an investigation into issues at Transnet after receiving whistle-blower reports of “unlawful conduct, including corruption, abuse of power, victimisation of employees and breaches of the code of ethics and the PFMA”.
– Additional reporting by Zinhle Mapumulo
