Does A Thief Turned “Whistleblower” Deserve Immunity?

By Pinky Khoabane

The VBS Sequestration Case and Suzanne Daniels Case Send Message That Thieves, even When Turned Whistleblowers May Not Be Exonerated From Prosecution…

IF the two cases of the last two weeks involving “whistleblowers” are anything to go buy, informers who snitch on their accomplices when they themselves are caught-out should not expect immunity.

Two weeks ago Advocate Nazir Cassim, who headed a disciplinary hearing into the conduct of former Eskom Head of Legal Suzanne Daniels, found there was enough collusion on her part to warrant a summary dismissal. Daniels was lauded as the “whistleblower” who blew the lid on allegations of Eskom’s state capture involving the Gupta family. The Advocate found she was not a trustworthy witness and had not made full disclosure of her role in the transactions which were being investigated and had not provided any new material to the enquiry.

He said her disclosures were “too little too late” “opportunistic” and of someone “trying to save herself” when she was already caught out. A cyber forensic audit of Eskom executives exposed Daniels’s emails to Salim Essa, dubbed “Gupta kingpin” by the media.

A week later, the South Gauteng High Court provisionally sequestrated the assets of the men who allegedly stole from the shareholders of VBS Mutual Bank despite protestations by whistleblower Phophi Londolani Mukhodobwane, VBS’ former treasurer, that he had disclosed the shenanigans that led to the bank’s liquidity problems in return for protection from prosecution. In the affidavit he gave to forensic investigators he had incriminated himself and other executives at the bank. He supposedly blew the lid on an elaborate scheme through which Vele Investment (VBS main shareholder) and VBS executives used suspense accounts to defraud VBS of R1.5bn. It is alleged the affidavit reveals how he took a helicopter ride with R5m stashed in a suitcase as a bribe in return for business from Public Investment Corporation. The executives paid themselves hefty sums in bonuses with which they maintained a lavish lifestyle involving helicopters and expensive cars and property, and Mukhodobwane got R10m part of which he used to buy himself a ferrari.

Having disclosed this information, he says he woke up to find the confidential affidavit he had given to the forensic investigators on social media. Frankly, the investigators had lied to him about the assurance that he must disclose everything he knows in return for protecting his identity. This is the cardinal rule for whistleblowing and it’s done for the purpose of protecting the whistleblowers against reprisals and to create a climate that will encourage future whistleblowers.

As if that wasnt enough breach, the same “confidential” affidavit was used by VBS to apply for his sequestration and that of four other executives at the bank including shareholder Vele Investments.

In a 48-page answering affidavit in which the former treasurer challenged VBS’ decision to sequestrate him, he argued that he had disclosed to forensic investigators, information which ended up with the employer who had used it to sequestrate him. He argued that the investigators had breached the confidentiality agreement they had with him and that VBS was in turn using this information without his permission. Phophi Submission

In addition, he pointed to technical flaws in the application for sequestration process: “I can categorically state that I am not insolvent. The applicant has also failed to state why it has decided to make a sequestration application against me without claiming any money from me. I received no letter of demand and there is also no reason that the applicant advanced to the effect that I am unable to pay any amount.

“The applicants’ attorneys (Werksmans) are in possession of an amount of ZAR1.269 million, which they demanded be paid over to their trust account emanating from discussions at the meeting of the 24 April 2018. I am also not liable to the applicant for any amount in the first place. Whatever money, I received from the applicant was what was legally due to me in accordance with either employment agreement and/or credit facility that the applicant granted my company (Lemawave).

“There was also no letter of demand, that I received from the applicant, for payment of any amount that was allegedly owed to VBS. There was no civil action instituted against me for the payment of money that I allegedly owed VBS. As such, the applicant failed to make the relevant averments of insolvency”.

Despite the legal arguments, Mukhodobwane together with VBS and Vele Investment executives were provisionally sequestrated last week.

The affidavit in which he challenged the sequestration application shows he had originally been uncooperative and unwilling to assist the investigators. He later agreed to assist but his “confidential” information ended in the press. Did investigators deem it “too little too late” as in the case of Daniels? Has he got a point when he says the investigators were in breach of the agreement of confidentiality?

Judge Tsoka in his ruling in granting the sequestration order said: “…the interest of justice looms large in this matter and that VBS was stripped of its assets that belong to poor people. Fraud was perpetrated by the very people that were placed in the position to look after these people’s interests. It was motivated by greed, where enough is never enough”.

The judge cited a quote from the novel, Atlas Shrugged, (1956): “when you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is doomed”.

“Luckily”, the Judge concluded ” it is not 1956 but 2018, and the constitution rules supreme and justice is done between men”.

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