[ad_1]
- Johannesburg Mayor Geoff Makhubo is in legal and reputational trouble over the payments his company received from Regiments Capital.
- Molelwane Consulting reportedly received R35.7 million from the Regiments, of which at least R7.1 million was paid to Makhubo’s personal bank account.
- Makhubo struggled to explain why he received the payments and why he repeatedly lied when he faced amaBhungane in 2018.
“I … resigned as a member of Molelwane Consulting and director of all other companies in November 2011.”
That’s what the mayor of Johannesburg, Geoff Makhubo, told the Beetles in 2018.
We had just discovered a secret deal to transfer 10 percent of a contract from the city of Johannesburg to Makhubo’s company, Molelwane Consulting.
READ MORE | Joburg ANC leader made millions from city contract
The contract had been awarded to the capos of the state capture Regiment Capital in 2006, before Makhubo took a post in the city. But when he was appointed to the mayor’s finance committee in 2011, it became a conflict of interest for him to oversee the city’s finances and to benefit from one of its most important contracts.
Makhubo denied a conflict, saying in one of four responses written at the time: “I … resigned as a member of Molelwane Consulting and a director of all other companies in November 2011.”
In another, he said: “I … made a commitment to the Mayor of the day and to the ANC when I was appointed a member of the post of a member of the mayoral committee that I will dismantle my interests and resign all my addresses. “.
Except that company records show that Makhubo remained a member and owned two-thirds of Molelwane until October last year.
And evidence presented at the Zondo commission on the state capture on Friday suggests that it also did not give up its financial interests in the opaque consulting firm.
Test leader Matthew Chaskalson told the commission that they had identified R35.7 million from the regiments that flowed into Molelwane between 2008, when Makhubo became treasurer of the ANC’s Greater Johannesburg region, and 2016, when the ANC he lost political control of the city.
Of that, at least R7.1 million was allegedly transferred to Makhubo’s personal bank account.
Faced with this evidence, Makhubo was forced to admit that he did not resign from Molelwane in 2011 as he had told amaBhungane in 2018. Instead, he told Supreme Court Vice President Raymond Zondo that he signed a resolution to resign in 2011, but that this was never featured.
In part this was because Molelwane is a closed corporation and resigning as a member would mean giving up your ownership interest as well. And with millions still flowing into Molelwane, Makhubo was reluctant to let go.
“I wanted to get rid of myself … but it never was,” Makhubo admitted.
“My understanding … was that I would resign but then I would start to assess and see what Molelwane stood for, a company that I had worked for eleven years and that I had built from scratch: how do I get my capital back from sweat, how do I get whatever? I was owed … the problem was that I could not leave … because I was accumulating wealth. “
But Makhubo’s vague responses didn’t sit well with Zondo.
“By 2018, you would have known that the resignation had not occurred even though there was a resolution, right?” I ask.
When Makhubo confirmed that this was correct, Zondo pressed again: “I can understand a situation where you had taken the steps you thought necessary to effect a resignation, such as signing the resolution or signing the resignation letter … So you think you had renounced.
“But by 2018, I guess you knew that the resignation had not happened … Then the question would arise, how would you say [to amaBhungane] in 2018 he resigned in circumstances in which he is expected to know that the resignation resolution was not complied with. Do you understand where my concern is? “
In fact, Makhubo had gone even further. In one of his 2018 responses, he wrote that his office “followed up and confirmation was received that my resignations have been noted and processed.”
It is also worth noting that Makhubo had the opportunity to correct any inaccurate statements he may have made in 2018. AmaBhungane exchanged nine letters with Makhubo over a period of almost two months, five sets of questions from us, and four written responses from him, before our research was published.
But when the commission asked Makhubo if he misled amaBhungane, and therefore the public, in 2018, he refused to budge.
Instead, he told the commission that he “did not believe these amaBhungane questions were innocent … I thought they were loaded with a lot of politics.”
The problem for Makhubo is that instead of ignoring our questions, he provided false claims that could now hurt him.
For example, by stating that he resigned “to address an actual or potential conflict of interest,” he expressed appreciation that remaining a member of Molelwane, as he did, was a conflict of interest.
The city has previously confirmed that Makhubo declared an interest in Molelwane. But as far as we know, he did not disclose 10% of the Molelwane Regiments contract and did not recuse himself when decisions were made that would benefit the Regiments. As political head of the finance department, Makhubo was directly responsible for overseeing the regiments’ contract with the city.
Molelwane will be important again when Makhubo returns to the commission to testify about payments he allegedly requested from IT company EOH, payments that went directly to him, Molelwane, or to fund the ANC.
Taken together, the evidence presented thus far strongly suggests that Makhubo participated in a something for something with both the Regiments and EOH, and that both companies paid him to exert their political influence in their favor, either to secure contracts with the city or to keep them sweet.
As former Business Day editor Songezo Zibi tweeted over the weekend: “Geoff Makhubo may be in serious trouble. The 15-year-old kind.”
