Despite evidence that political corruption may have been rampant during apartheid, there has been a surprising lack of political will to investigate

“If there was corruption during Apartheid, why didn’t anyone hear about it?” A common and obvious question, with more answers than you might think.

One answer is that people who lived through apartheid often did hear about it. A brief scour of any newspaper archive would confirm as much: from the Rand Daily Mail’s probing of a secret Swiss bank account linked to former Finance Minister Nico Diedrichs, to Vrye Weekblad’s exposition of dodgy SADF front companies and the Weekly Mail’s regular reports on the shady moneymen linked to politicians’ business interests. Despite the overwhelming climate of secrecy surrounding all activities of the apartheid regime (not to mention some of the regime’s most successful friends in the private sector), there were growing signs of thriving criminal networks within the politics of the day.

A 1989 survey of white voters showed that more than 50% of white voters polled felt that corruption had got worse under PW Botha. Afrikaans respondents show an especially high level of disillusionment. (Click on the image to read more.)
This suggests that, while under-reported and under-investigated, the whiff of decay was apparent.

But truthfully, the citizens of the new, constitutional democracy post 94 really hadn’t heard enough about corruption under apartheid. The same high levels of secrecy that created an opportunity for certain individuals to enrich themselves also made it incredibly difficult to bring scandals to light, which has greatly hampered efforts since then to bring past economic crime to book.

The dying days of apartheid were marked by a number of inquiries, investigations, and prosecutions instigated by the old regime into a variety of governance scandals and human-rights abuses; although these typically focused on state-sponsored violence, more than once they stumbled on evidence of corruption and economic crime attendant to the state machinations of the time. However, in many instances these inquiries were dogged by accusations of whitewashing – and where there were prosecutions, often these were merely the middle managers of apartheid who claimed that they were scapegoats for their political masters.

Post 1994, the already capacity-strained Truth & Reconciliation Commission never included economic crime and corruption in its mandate, although it’s been argued that these crimes do violate human rights (more on this later). Although the TRC’s investigations may have uncovered evidence of corruption incidentally, this clearly wasn’t going to be the vehicle to investigate the legacy of grand corruption in South Africa. Although the Commission’s work was both vast in quantity and horrifying in content, it was constrained to a ‘narrow’ reading of human rights violations that didn’t include corruption.

The piecemeal investigations since then have left much to be desired, as illustrated by the hapless Thabo Kubu unit.

The Thabo Kubu unit

In the late 1990s, the post-apartheid National Intelligence Agency (NIA) set up a special unit to track down money plundered from state coffers under the apartheid regime. Headed by former MK commander Thabo Kubu, it comprised both former ANC intelligence operatives and former apartheid operatives (including the recently deceased hitman-turned-whistleblower Dirk Coetzee).

The unit made headlines after several of its members became enmeshed in corruption allegations themselves – however, none of the rumours resulted in any prosecutions. After the Auditor-General’s office found irregularities in the unit’s accounts, the Thabo Kubu unit appears to have been shut down – and if they recovered any proceeds of apartheid corruption, the South African public is none the wiser.

The ‘Ciex’ report

At around the same time, in 1997, a UK-based private investigations company called Ciex secured a contract from the South African government to investigate apartheid plunder. Two years later, Ciex delivered a secret report to several senior Cabinet Ministers that claimed to have identified about R26-billion that was stolen, laundered or held offshore illegally by apartheid-era bankers, arms dealers and senior politicians. These were funds that were not just identified as missing, but which could be retrieved; essentially, Ciex’s director, Michael Oatley (formerly a senior agent of the UK intelligence agency MI6) was offering to oversee the return of these funds to state coffers, in exchange for a handsome percentage of the profits. However, the Ciex contract was terminated and none of these claims appear to have been pursued.

We know all this because a version of the Ciex report was leaked nearly 12 years later (making the front cover of Noseweek in September and October 2010). It should also be said that most of its contents remain unproven and there is no official response from the State as to why a report, paid for with public funds, was not the basis of further investigation and possible prosecution.

(In a bizarre sub-plot to this saga, the SABC commissioned a documentary on these outstanding claims in 2012 which it appears now to have shelved.)

The Public Protector’s investigation

Although the state organs that commissioned the Ciex report appear to want nothing to do with it, the Public Protector Adv. Thuli Madonsela independently announced in August 2011 that she would investigate some of Ciex’s claims, although she had initially declined for lack of resources.

The Public Protector’s investigation (still ongoing) appears to focus on aspects of Ciex’s report that deal with the controversial ‘lifeboat’ loans that took place from 1985 to 1995. These were a series of secret and extremely favourable Reserve Bank loans to a politically connected bank called Bankorp which was later bought by Absa. Accusations of patronage were fuelled by the fact that the Minister of Finance at the time, Barend Du Plessis, never acknowledged his conflict of interest in approving the Reserve Bank’s loan: his brother was on the board of a major subsidiary of Sanlam/Bankorp, which benefitted from the influx of cash.

The Ciex report alleges that the loans were effectively gifts to Bankorp’s various shareholders, including at various points Absa, Sanlam and the Rupert family’s investment vehicle, Rembrandt. Although the Ciex report was not the only probe of the Reserve Bank loans (they were also investigated by Judge Willem Heath, and as well as a Reserve Bank-commissioned panel headed by Judge Dennis Davis), Ciex’s conclusions are potentially the most explosive, estimating that R3.2bn in public money could be retrieved from Absa, and roughly the same from Sanlam.

A provisional report of the Public Protector investigation is in the process of finalisation; the final report is expected to be released to the public in a matter of months.

So what next?

While the public awaits Adv. Madonsela’s report, we can only hope that it will lead to a full investigation that bring closure to these claims. Unfortunately, the State’s track record in probing apartheid-era corruption doesn’t inspire optimism.

In 2006, a group of civil society organisations published a report on ‘Apartheid Grand Corruption’ – an attempt to build political will in business and government to tackle economic crime during the transition. The report was discussed by the Cabinet under former President Mbeki, after which a Cabinet statement noted that the report, “did raise pertinent issues including matters relating to government assets”. However despite extensive media coverage there was no public disclosure of further investigation by the State. (The report was authored by Hennie van Vuuren, a collaborator on this site.)

The lack of political will in tackling these issues is perplexing – even from a cynical standpoint, a highly publicised inquiry into apartheid-era corruption would have been an ideal ‘foil’ for the new government to deflect criticism of ‘contemporary’ corruption problems. But ideally, it would have been an opportunity for a reset – for a society to start afresh. It would have served justice and helped purge public life of a culture of secrets and lies. The fact that today’s political elite has resisted most efforts to probe these matters is suggestive of how deeply intertwined the corrupt systems of yesterday and today may be.

But these questions linger, and demand answers.