Quote of the week

Mr Zuma is no ordinary litigant. He is the former President of the Republic, who remains a public figure and continues to wield significant political influence, while acting as an example to his supporters… He has a great deal of power to incite others to similarly defy court orders because his actions and any consequences, or lack thereof, are being closely observed by the public. If his conduct is met with impunity, he will do significant damage to the rule of law. As this Court noted in Mamabolo, “[n]o one familiar with our history can be unaware of the very special need to preserve the integrity of the rule of law”. Mr Zuma is subject to the laws of the Republic. No person enjoys exclusion or exemption from the sovereignty of our laws… It would be antithetical to the value of accountability if those who once held high office are not bound by the law.

Khampepe j
Secretary of the Judicial Commission of Inquiry into Allegations of State Capture, Corruption and Fraud in the Public Sector including Organs of State v Zuma and Others (CCT 52/21) [2021] ZACC 18
8 March 2010

Jacob Zuma has flouted ethics rules before

No wonder President Jacob Zuma is flouting the provisions of the Executive Members Act. He has gotten away with this kind of thing before. In 2003 Zuma was in serious trouble after it emerged that he had received millions of Rand from fraudster Schabir Shaik without declaring these benefits as required by the Code of Ethics promulgated in terms of the Executive Members Act.

In 2003, following weeks of correspondence with Zuma, the Ethics Committee of Parliament exonerated Zuma – who was then still the Deputy President and therefore a very powerful man. The Committee had accepted his explanation that the “loans” given to him by Shaik were not free, but bore interest: “As there is no evidence at hand that contradicts the authenticity of the loan agreements, it is recommended that the loan agreements submitted by the Deputy President be accepted as valid and correct,” the committee concluded.

The report tabled on 19 November 2003 said, “In this matter the Deputy President provided documents to the Committee which verified his response that there was no benefit received. It is on this basis that the Committee finds that there is no breach to the code of conduct.”

The problem is that the High Court, in finding that Shaik had paid Zuma a bribe, found that these documents submitted by Zuma to Parliament were concocted by the conspirators in order to hide the fact that the money was a benefit and not a loan.

The Shaik judgment thus provides proof “beyond reasonable doubt” that Zuma had in fact defrauded Parliament (much like Tony Yengeni, who was sentenced to three years imprisonment after his fraud came to light). Zuma, however, was never prosecuted for defrauding Parliament, despite the fact that the “loan agreements” he had submitted to Parliament were found to be fraudulently made.

In the judgment in which Schabir Shaik was convicted of bribing Zuma, the court found that the various “loan agreements” which Zuma had submitted to Parliament was nothing of the sort. As Judge Hillary Squires recounted the evidence, these various agreements were hastily drawn up in anticipation of the Code of Ethics kicking in: As Squires noted:

It is also clear from the evidence of Linda Makathini, the official legal adviser to the Deputy President, that the Executive Code of Ethics Act had been promulgated in October the previous year and the resultant Code was in the process of being drafted and actually came into existence in the following year. To show loans made without interest being payable under that Code, would amount to a benefit which would require a special declaration. If they carried interest, on the other hand, they were regarded as a liability and did not….

One only has to consider the financial position of the Nkobi Group as at the date of signature of this document [the loan agreement] to see how divorced from reality it was as a genuine business proposition….

We thought eventually the State’s contention about these documents was well founded. They are clearly not what they purport to be and were probably drawn up when this sort of information had to be disclosed by Members of Provincial Executive Councils and it would have been a suspicious circumstance if these payments had not been recorded as a loan. The evidence regarding the second such agreement, that is the agreement of loan of 16 May 1999, is hardly any better as a genuine statement of what it purports to be…

But then, even if these could be regarded as loans despite all the evidence to the contrary, the basis on which they were made would, in our view, unarguably amount to a “benefit” within the meaning of the word in the Corruption Act. [The Code also requires Cabinet Ministers to declare “benefits”.]

Thus, although Zuma had contended to Parliament that the sums of money he had received from Shaik were loans and hence did not have to be declared, the court found that the money given to Zuma could not have been loans and even if they were, these “loans” were given on such beneficial terms that they would constitute a “benefit” for the purposes of the Corruption Act – let alone the Code of Ethics. Zuma was therefore misleading Parliament when he claimed otherwise. This may very well have constituted fraud for which Zuma may – if he was charged – very well have been convicted and sentenced to three years imprisonment.

When Zuma was fired as Deputy President by President Thabo Mbeki after the Shaik verdict, he also resigned as a member of Parliament despite the fact that Mbeki had made no effort to fire him from Parliament. There was a very good reason for his sudden resignation. If he had remained an MP, the Ethics Committee would have had to re-open the probe against him and would have had to accept the factual finding in the Shaik case that the “evidence” provided by Zuma that the money received from Shaik was a “loan” and not a “benefit” as defined by the Code, was fake.

Zuma would then probably have been found guilty by the Committee of breach of the Code of Ethics and could then also have been charged with fraud. He therefore had no other option but to give up his seat in the National Assembly and forfeit the salary that went with it. His very freedom depended on it.

Given Zuma’s narrow escape around the fraudulent “loan agreements”, it is no wonder that President Zuma is trying to avoid declaring his financial interests and benefits and those of his spouses, companions and dependent children. If benefits were received and they were not declared and he was caught out again, he would surely go down.

Of course, it might be that Zuma, his spouses, companions and dependent children had not received any benefits from anyone since he had become President. Even if he and his family have indeed received such benefits they might well be above board in that they might have been given in the spirit of generosity. Unlike in the Shaik case where the money was given as a bribe, it might be that any benefits given to Zuma more recently were not given to secure favors from the President in return for the benefits. In that event, Zuma would have nothing to fear from declaring these benefits (if any).

The fact that he has not declared anything and is claiming rather laughably that it is unclear whether he needs to declare anything, will, however, raise serious questions about Zuma’s honesty and integrity and his ability to stay on the right side of the corruption legislation. If he honestly declares all his interests, he will go a long way to answer those questions and clear up the dark cloud hanging over his head. If he continues to stonewall, we will be well within our rights to conclude that Zuma has not learnt his lesson from the Shaik fiasco and that he is (still) implicated in corrupt practices.

Only time will tell.

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