Lifeboat report ‘irrational’ – Absa
Mkhwebane ‘cherry-picked information’
PUBLIC protector Busi Mkhwebane’s report on the Bankorp lifeboat was “irrational” and cherry-picked from previous investigative reports, Absa said on Wednesday.
Responding to the Absa/Bankorp findings, Barclays Africa’s South African arm said Mkhwebane’s office had “either effectively ignored or misunderstood Absa’s detailed submissions, which were made to it on two occasions”.
In her report released on Monday, Mkhwebane said that the government and the Reserve Bank had not protected the public interest by bailing out Bankorp between 1985 and 1991 and she referred the matter to the Special Investigating Unit to recover funds from Absa of R1.125-billion.
Absa met with lawyers on Tuesday and instructed them to immediately approach the high court to review the report.
Mkhwebane’s spokeswoman, Cleopatra Mosana, said they were at liberty “to take the report on review. However, remedial action will have binding effect until set aside by the court of law”.
On Wednesday the bank set out what it saw as the bones of contention, mainly around how the public protector’s findings and remedial actions relating to Absa were based on the conclusions of the Davis panel of experts constituted to look into the Bankorp rescue.
Former Reserve Bank governor Tito Mboweni appointed the Davis panel in 2000 to look into the allegations contained in the Ciex report authored by private investigator Michael Oatley – whose mandate was to assist the democratic government in recouping cash lost to apartheid corruption.
The panel delivered its report two years later, finding that the Reserve Bank had acted beyond its powers in granting assistance to Bankorp, which Absa bought in 1992.
“In the case of the Davis panel, the public protector’s final report misrepresents or misconstrues its findings. While it concluded that the manner in which the assistance was provided to Bankorp was unlawful, the Davis panel unequivocally found that Absa is not liable to pay because it paid fair value for Bankorp.”
Absa said Mkhwebane did not explain why her office accepted parts of the Davis report, but not others.
“In this respect, the public protector’s report appears irrational,” it said.
Absa also said the public protector’s office had relied on the alleged testimony of former Reserve Bank governor Chris Stals in a provisional report leaked in January.
Stals was said to have testified that loans were given to Bankorp at an interest rate of 16% and that there was a contract to prove this.
“The alleged testimony of Dr Stals and the document he was said to have produced are conspicuously absent from the final report,” Absa said.
“In the final report, this basis is abandoned and instead it selectively relies on a report that in any case found that Absa is not liable.” — TMG