Zuma must answer for ‘negligence’ at Pamodzi Gold

KHULUBUSE Zuma claims allegations levelled against him by trade unions distort the findings of a 2013 inquiry into the affairs of Pamodzi Gold.

“Zuma wishes to record that he has noted statements attributed to the Congress of SA Trade Unions (Cosatu) and National Union of Mineworkers (NUM) leadership, castigating him for taking steps to protect his rights and blaming him for the plight of the mineworkers who were employed by Pamodzi,” his spokesman Vuyo Mkhize said on Friday.

“These statements seek to distort the findings of the report that was filed by advocate (Wayne) Gibbs, the commissioner who was tasked by the Master of the North Gauteng High Court to conduct an inquiry into the affairs of Pamodzi, on September 21 2013.”

The report found that Zuma in all probability had not been aware of fraudulent misrepresentations contained in the bid document for Pamodzi.

However, the inquiry further found that this in itself did not exonerate him.

“I find Zuma was not aware that the terms of the bid document were false, but that by the exercise of reasonable care, the care expected of a director in his position, he would in all probability have been aware of the fraudulent misrepresentations contained therein,” Gibbs said in his report.

“Although one has sympathy with Zuma, the fact that he trusted his associates (which explains his laissez faire approach and lack of control), (that he) was allegedly also defrauded and lost millions of his personal wealth… this does not exonerate him from his statutory duty of care towards the company and to my mind he was negligent in his approach, as envisaged by sections 77 and 76(3)(c) of the new Companies Act.”

Negligent

He found that the fraudulent activities could have been avoided had Zuma kept an eye on the management of the company.

“One should not lose sight of the fact that the other directors, unlike Zuma, did not merely fail their duties to be diligent, but actively participated in misrepresenting facts to the joint provisional liquidators and embezzling assets belonging to the companies, thereby resulting in them being liable to the companies directly in terms of section 424 of the old Companies Act and/ or delict.”

Mkhize on Friday said that Zuma was aware that he had to answer to the fact that he was negligent as a director of Aurora Empowerment Systems.

However, he said Zuma was not party to alleged acts of fraud, theft or asset-stripping insofar as the conduct of Aurora’s business was concerned, as the inquiry found.

In 2009, Aurora was appointed by liquidators to manage Pamodzi’s mines in Springs and Orkney after the company went bankrupt.

Aurora allegedly stripped the mines of infrastructure, while failing to pay its employees who had to survive on handouts.

Earlier this week, an urgent application by Zuma to have claims of more than R1.5 billion against Aurora set aside was dismissed by the North Gauteng High Court.

Judge Eberhardt Bertelsmann dismissed the application with costs.

He found that Zuma’s interests were not directly affected.

Aurora’s liquidators want to take the matter to court to hold the company’s directors responsible after they allegedly stripped the assets of the liquidated Pamodzi Gold’s mines in Springs, Gauteng, and Orkney, North West.

The case is scheduled to be heard on March 23.