For­mer Sars boss Tom Moy­ane has launched a new bid to re­gain his po­si­tion, while law firm Ho­gan Lovells has thrown him un­der the bus. Could crim­i­nal charges fol­low?

Financial Mail - - FEATURE - Natasha Mar­rian mar­ri­[email protected]­nesslive.co.za

Axed SA Rev­enue Ser­vice (Sars) boss Tom Moy­ane has yet to an­swer to the al­le­ga­tions lev­elled against him in­di­vid­u­ally in the dis­ci­plinary process ini­ti­ated by Pres­i­dent Cyril Ramaphosa in March.

At the heart of th­ese charges is Moy­ane’s han­dling of the R1.2m in sus­pi­cious and un­usual trans­ac­tions in the bank ac­count of his for­mer sec­ond-in-charge, Jonas Mak­wakwa, which was iden­ti­fied by the Fi­nan­cial In­tel­li­gence Cen­tre (FIC) in 2016.

This week the mat­ter took an in­ter­est­ing twist when Ho­gan Lovells, the law firm Moy­ane hired to in­ves­ti­gate the Mak­wakwa trans­ac­tions, ac­cused Moy­ane of hav­ing been a “liar” when he pub­licly said his for­mer sec­ond-in-charge was cleared of wrong­do­ing and al­lowed him to re­turn to work in Novem­ber 2017.

Moy­ane ap­proached the Pre­to­ria high court last week to re­verse his ax­ing and pre­vent Ramaphosa from ap­point­ing a suc­ces­sor. Ar­gu­ments were heard this week. It was yet an­other at­tempt to hob­ble the restora­tion of the key state in­sti­tu­tion.

Moy­ane’s bat­tle to keep his job be­gan in March, and the past nine months have been char­ac­terised by a vo­cif­er­ous at­tempt on his part to block all pro­cesses to hold him to ac­count and get Sars on the road to re­cov­ery.

Moy­ane also wants the court to pre­vent the Sars com­mis­sion of in­quiry, chaired by re­tired judge Robert Nu­gent, from de­liv­er­ing its fi­nal re­port to Ramaphosa in the com­ing week, and to re­store his sus­pen­sion (he was fired by the pres­i­dent on Novem­ber 1). He wants to re­vert to sus­pen­sion on full pay and po­ten­tially face his dis­ci­plinary charges.

While the ex­tent of Moy­ane’s mis­rule at Sars was made pa­tently clear be­fore the Nu­gent in­quiry over the past five months, the dis­ci­plinary in­quiry against the for­mer tax boss has largely stalled due to his “Stal­in­grad” le­gal ap­proach.

The charges he faces in the dis­ci­plinary process are par­tic­u­larly dam­ag­ing, es­pe­cially with Ho­gan Lovells this week throw­ing him un­der the bus and call­ing him a liar.

The firm was tasked by Moy­ane with in­ves­ti­gat­ing the sus­pi­cious and un­usual trans­ac­tions af­ter he sat on the FIC re­port for four months. The FIC re­port was handed to Moy­ane in May 2016, but in­stead of act­ing on it, he handed it di­rectly to Mak­wakwa and kept mum about it un­til Septem­ber, when the Sun­day Times re­ported on it.

Af­ter a pub­lic out­cry, Moy­ane was forced to sus­pend Mak­wakwa, and an­nounced that he had in­sti­tuted an in­ves­ti­ga­tion by “re­spected” in­ter­na­tional law firm Ho­gan Lovells.

The sub­se­quent in­ves­ti­ga­tion was de­scribed as a “white­wash” by civil society group Cor­rup­tion Watch, and the firm was heav­ily crit­i­cised by par­lia­ment over its han­dling of the mat­ter af­ter Moy­ane an­nounced in Novem­ber 2017 that Mak­wakwa had been cleared of all charges by the Ho­gan Lovells in­ves­ti­ga­tion and would re­turn to work.

Ho­gan Lovells was ac­cused of be­ing com­plicit in Moy­ane’s at­tempt to shield Mak­wakwa.

Ho­gan Lovells part­ner Wes­sel Baden­horst tells the FM that the firm in­ves­ti­gated only one strand of the al­le­ga­tions against Mak­wakwa in the FIC re­port, and that there were two out­stand­ing mat­ters that had not been dealt with: an in­ves­ti­ga­tion by the Hawks and a probe of po­ten­tial tax eva­sion that should have been con­ducted by Sars.

Yet, de­spite hav­ing two key prongs of the in­ves­ti­ga­tion out­stand­ing, Ho­gan Lovells is­sued a fi­nal re­port on the mat­ter and handed it to Moy­ane.

Baden­horst says this was be­cause the “labour laws put [the firm] in a corner”.

He adds: “Mak­wakwa at that point … had been on sus­pen­sion for a year, he was run­ning to the [Com­mis­sion for Con­cil­i­a­tion, Me­di­a­tion & Ar­bi­tra­tion] say­ing: ‘You have to charge me now’ … We could not get any­thing fur­ther out of the Hawks; Sars [was] say­ing the tax in­ves­ti­ga­tion [was] con­fi­den­tial and [was] not telling us what the out­come [was] … so that was very frus­trat­ing.”

He ad­mits that the dis­ci­plinary process that fol­lowed, in which Mak­wakwa was found not guilty, was weak.

“But where it goes all wonky is where Moy­ane comes out and says Ho­gan Lovells has cleared him … we came out a week later and said we hadn’t cleared him.”

Baden­horst says Ho­gan Lovells was bound by client con­fi­den­tial­ity and could not di­vulge fur­ther de­tails at the time, at least un­til Sars lifted the priv­i­lege clause af­ter Moy­ane’s de­par­ture.

He says the firm stated in its fi­nal re­port that the two strands of the in­ves­ti­ga­tion were still out­stand­ing, and that this is where “Moy­ane lied” when he said the law firm had cleared Mak­wakwa of wrong­do­ing.

“What Moy­ane did was not only ly­ing — it was ly­ing and ma­nip­u­la­tion. Not only had he lied to the min­is­ter, par­lia­ment and the pub­lic, but he also sold out his own em­ploy­ment re­la­tions de­part­ment,” Baden­horst says.

He ad­mits that Ho­gan Lovells could have han­dled things dif­fer­ently and says it has learnt “lessons”.

With th­ese de­vel­op­ments, it is clear that, should Moy­ane by some mir­a­cle win in the high court and even­tu­ally face the dis­ci­plinary process started in March, Nu­gent’s scathing find­ings on his ap­proach to man­age­ment could amount to a walk in the park.

His con­duct in the Mak­wakwa mat­ter could very well re­sult in him be­ing charged crim­i­nally, with the Hawks and Sars in­ves­ti­ga­tions still seem­ingly not fi­nalised.

What Moy­ane did was not only ly­ing — it was ly­ing and ma­nip­u­la­tion Wes­sel Baden­horst

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