SIU, SABC want former board members declared delinquent directors
Former CEO Hlaudi Motsoeneng’s pension is being withheld as part of a strategy to recoup the losses incurred under his damaging leadership
The former members of the SABC board should be declared delinquent directors and must be placed under probation for failing to act in the best interests of the corporation, the Special Investigating Unit (SIU) said on Thursday.
The SIU and the SABC are also trying to recoup losses incurred by the broadcaster by withholding the pensions of erstwhile bosses including former CEO Hlaudi Motsoeneng and James Aguma, who previously acted in the position of CEO.
The new SABC board‚ chaired by Bongumusa Makhathini‚ has been on an aggressive drive to improve the dire financial state and the operations of the public broadcaster following years of decline under Motsoeneng and other former executives who he irregularly awarded staggering salary increases and promotions.
The current mess at the public broadcaster has largely been blamed on the former executives.
The Pension Funds Act permits certain deductions from a member’s retirement fund benefit. According to 10X Investments, a retirement fund administrator and investment manager, the deductions can be amounts due in respect of housing loans, granted by the fund/employer or for which the fund/employer agreed to stand surety; pension interests awarded to former spouses on divorce; maintenance claims awarded against the member and the fund; and damages due to an employer caused by a member’s misconduct.
Briefing members of parliament’s communications portfolio committee this week, Andy Mothibi, the head of the SIU, pointed out that initial investigations showed that former board members and executives had a case to answer.
He said the SIU had found evidence that indicated that there were irregularities in the awarding of various contracts including to Vision View Productions, SekelaXabiso, Lorna Vision, Lezaf Consulting, Gekkonomix (trading as Infonomix), Asanta Sana, Foxton Communicating and Mott MacDonald.
“Evidence obtained also indicated that there were irregularities in the awarding of the success fee to Mr Motsoeneng, as well as various appointments and salary increases awarded by Mr Motsoeneng,” said Mothibi.
“SIU also confirmed the public protector’s findings that the following appointments of SABC staff/and or salary increases were irregular: Ms Sully Motsweni, Ms Thobekile Khumalo and Ms Guga Duda.”
He said the Lorna Vision contract had been set aside by the High Court. In May, the SIU submitted evidence to the SABC’s attorneys (Werksmans) in support of a civil claim against Lorna Vision and Aguma to recover close to R63m.
The SIU is also investigating the contract with MultiChoice which ended in July 2018. A new contract was been entered into in September 2018 for five years.
Mothibi said the SIU was looking into the legality of the agreement and subsequent amendments to it, including whether any provisions were contravened or not complied with; the roles played by individuals involved in the process and whether any of them benefited unduly; whether the agreement was viable and/or in the best interests of the SABC; and whether the SABC had in fact received all payments due to it.
“As part of the overall SIU investigation, the evidence and findings of all the individual investigations are being collated and considered by the SIU, with a view to the SIU and SABC, bringing an application under section 162 of the Companies Act of 2008, to declare the former SABC board members delinquent directors and to have them placed under an order of probation for failing to act in the best interests of the SABC,” said Mothibi.
The SIU is also considering remedial action against individuals where governance failures have occurred and reporting requirements have not been complied with.
Portfolio committee chair Hlengiwe Mkhize said: “We have noted the positive progress, in which millions of rands worth of contracts were declared irregular and set aside by the courts. We also note that due legal processes are in motion to recover the lost funds.”
Mkhize said the committee supports the SIU and SABC in filing an application to declare the former SABC board members to be delinquent directors.