Mashaba lays fraud charges against Tau
Citizen reporter
City of Joburg mayor Herman Mashaba, pictured, has laid criminal charges against his predecessor, Parks Tau of the ANC, and Geoff Makhubo, former member of the mayoral committee for finance and current leader of the ANC’s Johannesburg region.
The charges include corruption, fraud, money laundering and racketeering against both Tau and Makhubo.
Mashaba, a member of the DA, laid the charges at the Johannesburg Central police station yesterday following an amaBhungane report revealing allegations that Makhubo and Tau orchestrated a windfall of about R30 million by allowing the former to unduly act as a broker for Regiments Fund Managers, giving the fund manager unfettered access to lucrative deals within the city.
A statement issued by the mayor’s office says that in 2006, Regiments received a contract to manage the city’s “sinking fund” – a pool worth billions of rands set aside to meet the city’s future debt repayment needs.
By 2015, Regiments had amassed an estimated R300 million in fees. A contract signed by Makhubo shows that Regiments agreed to pay 10% of its fees to Makhubo’s company Molelwane Consulting in exchange for Makhubo’s “maintenance of strategic relationships with the CoJ [City of Johannesburg]”, it read.
It further alleges that as a councillor, Makhubo had consistently failed to relinquish his 67% stake in Molelwane, as confirmed by the city’s integrity officer.
“Cllr [councillor] Tau not only knew of the crooked deal, it is suspected that Cllr Tau allowed the arrangement to take place so as to also benefit his political party the ANC. This will be confirmed through an additional ongoing investigation into the matter.”
In correspondence, Regiments is said to have provided a shopping list of expectations, including lucrative deals which they expected Makhubo to deliver.
The amaBhungane report shows that Regiments received almost everything on their wishlist: “In January 2011, the city agreed to release R18.4 million of Regiments’ fees; in March, Regiments facilitated a R250 million loan for the city and received R1.25 million as a raising fee; and in December, it was one of two bidders awarded Johannesburg Property Company tender.”