Johannesburg’s Executive Mayor, Clr Mpho Parks Tau, has been cleared of all allegations that he irregularly benefitted from a financial transaction involving a consortium in which his wife has a minor shareholding.
The City’s Integrity Commissioner, Adv. Jules Browde, SC, has referred to media claims in this regard as “without any foundation,” and “without substance.” He also found that Mayor Tau has made a “full disclosure” of his wife’s shareholding in the City’s Register of Councillors’ Interests.
Adv Browde SC had further advised that reports, published in The Star and the Mail and Guardian, be referred the press Ombudsman for further consideration.
The author of the report that appeared in The Star of 9 October 2012 “… made no personal investigation into the facts… [and] got it wrong in material respects which I believe to be unfair to the Mayor,” the Commissioner concludes.
The detailed report of his investigation into the claims was presented to the City’s Ethics and Disciplinary Committee this week, which noted the findings and “dismissed the allegations” against Mayor Tau.
The Chief Whip of Council, Clr Prema Naidoo, said the report by the Integrity Commissioner vindicates Mayor Tau and proves that he has acted with honour and integrity throughout the process.
“The findings bring into question the media investigations and reporting with regard to senior politicians in the City. The repeated reports which contained unfounded allegations have done irreparable damage to the reputation of the Executive Mayor as a respected and trustworthy leader of South Africa’s most prominent City. “We believe there should be a prominent retraction and a full apology to the Mayor and his wife.
The report of the Integrity Commissioner follows claims published in the Mail and Guardian and The Star in October 2012 alleging that Mayor Tau, in his former capacity as Johannesburg’s Mayoral Committee of Finance, influenced a decision to award a tender for the management of the City’s Sinking Fund to Regiment’s Capital (Pty) Ltd.
The Mayors wife, Ms Pilisile Twala-Tau, is a minority shareholder in Coral Lagoon which, in turn, holds a 1% share in Capitec Bank. Regiments Capital, another shareholder in Coral Lagoon, was appointed in 2006, together with Umbono Fund Managers, to manage the City’s Sinking Fund for a period of five years.
Following the M&G’s report under the headline “Signs of Rigging in Tau Tender”, Mayor Tau requested the Public Protector to investigate and make a finding on the veracity of the allegations. He also referred it to the Speaker of the Johannesburg Council, Clr Conny Bapela, for further action.
The Integrity Commissioner and the Public Protector jointly decided that Adv. Browde, SC, would conduct the investigation and report to the City’s Ethics and Disciplinary Committee.
Adv. Browde had full access to all relevant documents and also conducted interviews with City officials who participated in the discussions and decisions to award the fund management contract.
The advocate concludes: “It is obvious from the documents and the evidence I heard…. that Councillor Tau played no part whatsoever in the tender process or the subsequent contract entered into between the City and Regiments/Umbono.”
The appointment of the companies “appears to have been above board” and they received the highest scores as determined by the evaluation committee.
“As a result, I have come to the conclusion… that it is without any foundation to suggest, as M&G has done, that Councillor Tau was a key decision maker in relation to the contract in 2005 entered into by the City with Regiments Capital (Pty) Ltd and Umbono Managers (Pty) Ltd.”
The Commissioner states that he takes into account that the Mayor has an interest in his wife’s holding of shares, but adds “… there is no reason that I am aware of which precludes a member of the City Council, or anyone in the Council employ, from investing shares in a public company which is listed on the Stock Exchange as is the case with Capitec Bank.”
“In my view, there is no substance in the suggestion that Mayor Tau has any conflict of interest arising out of the allotment to his wife of the shares,” the Report concludes.
Following a detailed explanation of the shareholding structures of the companies concerned, Adv. Browde, SC, notes that he cannot find any evidence “…which can be construed as bringing about a conflict of interest in Mayor Tau.”
“It is an unfair reflection on the Mayor’s Office and indeed the Mayor himself, not to mention Mrs Twala-Tau who appears to have been subjected to criticism merely because she was lucky enough to be allocated shares which, if sold, might turn out to be very lucrative.”
The Report notes that the major reason for the publication of misleading information “… was the extraordinary haste with which the whole matter was handled by the M&G newspaper.” He refers to the fact that the newspaper did, subsequently published a correction but “…it was apparent to me that the authors of the articles were confused as to the meaning of the correction and that this resulted from inadequate investigation into the facts of the matter.”
With regards to the report that was published by The Star on 9 October 2012, the Integrity Commissioner finds: “The author obviously attempted to follow what the M&G had publicised and, because she made no personal investigation into the facts, got it wrong in material respects which I believe to be unfair to the Mayor.
“This is certainly a matter for the [Press] Ombudsman’s consideration.”
Adv. Browde, SC also notes that he investigated whether Mayor Tau had disclosed the shareholding of his wife in the Register of Councillor’s interests and concludes: “Mayor Tau made what I consider to be full disclosure.”
