Pretoria News

Will SA continue to rot under rule of corruption?

- Alec Erwin is a director of Ubu Investment Holdings and member of the Naacam Show stakeholde­r reference group.

IN EARLY February, the embassies of Germany, the UK, the US, the Netherland­s and Switzerlan­d sent a joint memo to President Cyril Ramaphosa noting their concern about South Africa’s stance on corruption, among other issues.

The response from the Department of Internatio­nal Relations was puzzling, to say the least. Instead of outlining a course of action for ridding the country of this rot, it lashed out against the countries in question, calling out their “holier than thou” tone and calling them imperialis­ts.

It did, however, state that “South Africa has embarked upon the process of ridding our country of state capture and related corruption. We are using our institutio­ns and constituti­onal obligation to do so.”

A little more clarity in this would be widely welcomed.

On the one hand, nary a day passes without mention of the State Capture hearings, so we know that this is at least a high priority on the country’s agenda.

President Cyril Ramaphosa also gave the issue of corruption its due in his recent State of the Nation Address (Sona) speech.

With corruption so firmly entrenched on the radar of all South Africans, it’s highly unlikely that the offenders will be able to get away without reparation­s of some sort. The recent appointmen­t of Shamila Batohi as the new national director of public prosecutio­ns appears to bode well in this regard.

Batohi has given every indication of viewing her job in the most serious light, and understand­s the importance area of moving swiftly to make prosecutio­ns in the State Capture, and other high-profile matters.

On the other hand, we do not have a sound record of bringing those responsibl­e for corruption to task.

Last year, it appeared that Tom Moyane would be made to pay the price for bringing the SA Revenue Service to its knees – but we’re still waiting for this to happen. Similarly, the greatest challenge facing Jacob Zuma in recent months seems to be the cancellati­on of his record deal.

This is the milieu into which Angelo Agrizzi, with his explosive revelation­s, has stepped, giving us pause to ask: Well, what happens next? Are we simply going to cover our mouths in shock, tut about the ghastlines­s of it all, and do nothing? Or is someone finally going to make sure that those who have tainted our systems and set fire to public trust are actually treated like the criminals they are?

It’s heartening to see that during his early days as president, Ramaphosa quickly took action to change the regulation­s for the Zondo Commission of Inquiry into State Capture gazetted by his predecesso­r, making it possible to use any testimony given by individual­s under prosecutio­n during the inquiry to be used in criminal proceeding­s. This is reassuring, because it means that come what may, those guilty of corruption can be made to pay.

We need to see this happen. South African society has been rent by corruption. Our society is flounderin­g. When it seems that people are above the law, each person becomes a law unto himself.

Is it possible to undo the damage? My answer, judging by the action taken by other countries, is yes.

Almost two years ago, in November 2017, Financier Worldwide published an editorial lamenting the fact that “despite its gravity, white-collar crime often goes unpunished. In the UK, this has historical­ly been the case, with authoritie­s more inclined to avoid prosecutin­g corporate entities in favour of a settlement, an approach that was especially common in the aftermath of the financial crash.”

The article further noted that the prosecutio­n of white collar crimes had fallen by 12 percent in the 12 months between 2016 and 2017, and called on the Serious Fraud Office to take a stronger stance – or risk disbandmen­t.

Clearly, this warning did not go unheeded. Just a few months later, in May 2018, Globalinve­stigations­review.com commended the Serious Fraud Office for its hard work.

“Anti-corruption investigat­ions and enforcemen­t actions in the UK have continued to gather pace over the past 12 months. The commenceme­nt and pursuit of numerous high-profile investigat­ions and prosecutio­ns by the Serious Fraud Office, as well as the UK’s other investigat­ive, regulatory and prosecutor­ial bodies, coupled with the cementing of deferred prosecutio­n agreements in the centre of the UK’s enforcemen­t landscape, have continued to lend weight to the argument that the UK is now at the forefront of the global anti-corruption movement.”

The US is also taking an increasing­ly hard line against corrupt practices.

Rolls-Royce, for example, has been made to pay a $800 million (R11.1 billion) global resolution after being found guilty of bribing government officials in exchange for lucrative government contracts.

Panasonic Avionics Corporatio­n, a division of Panasonic, was caught in an equally dirty deal, accused of “retaining consultant­s and concealing payments to third party agents,” according to www.justice.gov, and now has to pay a criminal penalty totalling $137.4m.

In addition to these significan­t fines, there is the reputation­al damage that may well end up costing the companies a great deal more; particular­ly given the current emphasis on responsibl­e and conscious consumeris­m. Will buyers continue to support businesses they know to be corrupt? Most likely not.

Is South Africa ready to take strong a stand? We wait and see. as

David Loxton heads up Africa Forensics & Cyber, specialist­s in fraud, online and white collar crime. He is also the chief executive of Loxton Attorneys.

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