BANKORP DE­BA­CLE

Barclays Africa and Absa take the le­gal route to chal­lenge Pub­lic Pro­tec­tor

The Star Early Edition - - BUSINESS REPORT -

BARCLAYS Africa and Absa Bank said yes­ter­day that Absa has de­cided to ap­proach the High Court in or­der to have the Pub­lic Pro­tec­tor’s re­port that the bank must re­pay more than R1 bil­lion to the gov­ern­ment re­viewed and set aside.

Absa joins the South African Re­serve Bank (Sarb) which said it would bring ur­gent re­view pro­ceed­ings to have the Pub­lic Pro­tec­tor’s re­me­dial ac­tion set aside af­ter she di­rected Par­lia­ment to ef­fect a con­sti­tu­tional amend­ment to Sarb’s pow­ers.

Pub­lic Pro­tec­tor Bu­sisiwe Mkhwe­bane on Mon­day crit­i­cised the gov­ern­ment and Sarb for fail­ing to re­cover R1.125bn from Bankorp Limited/Absa Bank ad­vanced as an “il­le­gal gift” to the Bankorp group.

The Pub­lic Pro­tec­tor re­leased a fi­nal re­port on Mon­day re­gard­ing her in­ves­ti­ga­tion into the as­sis­tance pro­vided by the Sarb to Bankorp be­tween 1985 and 1995. Bankorp was ac­quired by Absa in 1992.

Mkhwe­bane said the amount given to Bankorp/ Absa be­longed to the peo­ple of South Africa. She said fail­ure to re­cover the “gift” re­sulted in prej­u­dice to the peo­ple of South Africa as the pub­lic funds could have ben­e­fited the broader so­ci­ety in­stead of a hand­ful of share­hold­ers of Bankorp/Absa.

How­ever, Absa said it was ap­proach­ing the High Court due to nu­mer­ous mis­rep­re­sen­ta­tions and fac­tual in­ac­cu­ra­cies which formed the ba­sis of the Pub­lic Pro­tec­tor’s find­ings, and what the bank sub­mits were the “ir­ra­tional and un­rea­son­able” le­gal con­clu­sions in the re­port. It said the mis­con­cep­tions and in­ac­cu­ra­cies in the re­port were pro­found and dam­ag­ing to its rep­u­ta­tion.

“We have ac­cord­ingly in­structed our lawyers to im­me­di­ately pre­pare an ap­pli­ca­tion to the High Court to have the re­port and its re­me­dial ac­tions set aside,” Absa said. “We deny that Absa re­ceived R1.125bn by way of un­law­ful as­sis­tance and we firmly main­tain our po­si­tion that all of Absa’s obli­ga­tions to the South African Re­serve Bank were met in full by Oc­to­ber 1995.”

The Pub­lic Pro­tec­tor probed al­le­ga­tions that CIEX, a covert United King­dom-based as­set re­cov­ery agency headed by Michael Oat­ley, was con­tracted by Pre­to­ria to as­sist in in­ves­ti­gat­ing and re­cov­er­ing mis­ap­pro­pri­ated pub­lic funds and as­sets al­legedly com­mit­ted dur­ing the apartheid regime.

Mkhwe­bane said the South African gov­ern­ment had failed to im­ple­ment the CIEX re­port be­cause she found no ev­i­dence that any ac­tion was taken to pur­sue the CIEX re­port af­ter the gov­ern­ment had com­mis­sioned and duly paid for its in­ves­ti­ga­tion.

Absa Bank in Cape Town. Absa main­tains that the Pub­lic Pro­tec­tor’s find­ings in her re­port were “ir­ra­tional and un­rea­son­able” le­gal con­clu­sions and mis­con­cep­tions and in­ac­cu­ra­cies were pro­found. PHOTO: REUTERS

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