Minister of Justice Thembi Simelane dropped a bombshell when she told the ANC’s Integrity Commission that President Cyril Ramaphosa was aware that she had obtained a R575 600 loan from corruption-accused Gundo Wealth Solutions before appointing her to his cabinet.
According to two sources with intimate knowledge of what happened, this is what Sime-lane told the commission during a virtual meeting two Wednesdays ago. Simelane’s startling revelations come after the president ordered her to submit a report explaining the circumstances surrounding the loan after Daily Maverick and News24 broke the story on it.
According to the sources, Sime-lane told the commission that before Ramaphosa appointed her as deputy minister of cooperative governance and traditional affairs in August 2021, the president grilled her about the loan and she gave him all the details about it.
Before the president could interrogate her about the loan, Limpopo ANC provincial chairperson Stan Mathabatha had informed him about the loan.
“Thembi told the commission that Limpopo ANC provincial chairperson and former premier, Stan Mathabatha, initially informed the president about the matter when Ramaphosa informed him about his plans to appoint her to his cabinet,” one of the sources said.
“Documents Thembi submitted before the commission confirm that this matter was investigated and ventilated by the provincial treasury in Limpopo, which made adverse findings against her. Seven other mayors in the province were fired by the ANC after being implicated in the VBS scandal,” the source added.
Simelane also told the commission the Investigative Directorate was using this loan against her because she had, as minister of justice and constitutional development in the Ramaphosa-led government of national unity, refused to hand over Zondo Commission records to it without following the proper procedure.
“Simelane told the [integrity] commission she had told the powers that be that she will consider handing over the records if proper procedures are followed and that those appointed to be custodians of the records are fully vetted,” the second source explained.
Simelane is apparently uncomfortable that former Zondo commission evidence leaders, Advocate Matthew Chaskalson and Advocate Paul Pretorius, have been appointed by the National Prosecuting Authority (NPA) as consultants. It is believed that the two are going to be the custodians of Zondo commission files.
A member of the ANC’s national executive committee, who wished to remain anonymous, stated: “The issue here is a gross conflict of interest. Advocate Pretorious and Advocate Chaskalson can’t be referees and players in the state capture investigations.”
Even the opposition EFF condemned the appointment of Chasklason and Pretorious and characterised it as “a gross collusion, opportunism, and undermining of the wheels of natural justice”.
“The appointments of these two individuals under a cloud of secrecy, wherein there is also a refusal to disclose their remuneration for their consulting services, would be amusing if it did not undermine the integrity and legitimacy of the NPA.
“In a quest to rescue her dwindling reputation and salvage a sense of achievement in a term defined by failure, [national director of public prosecutions] Shamila Batohi has abandoned sense and lost an appreciation of the law as a neutral instrument to administer justice in South Africa,” the EFF said.
The party also expressed its objection to Batohi’s “blind raid” on the evidence held by the Department of Justice.
Sources close to Simelane claim that the minister received questions from the media about her 2017 loan with Gundo Wealth Solutions hours after she met with NPA leadership, where she allegedly refused to hand over the Zondo commission files.
“The ANC in Limpopo dealt with the issue; the provincial treasury investigated the matter and concluded with its investigation in 2018. Simelane wasn’t fired but ordered to go to school to study public finance management as part of her punishment, which she did.
“And now, in 2024, someone decided to rehash the old story as a new thing,” the source close to Simelane said.
Simelane allegedly told the integrity commission that she went to Gundo Wealth Solutions for a loan after failing to secure it from a number of lending institutions, including commercial banks.
“Thembi told the commission that someone from one of the lending institutions where she had applied and failed to get the loan recommended that she try Gundo Wealth Solutions,” the source with intimate knowledge of what she told the commission told Sunday World.
When Simelane was mayor, the Polokwane municipality appointed Gundo Wealth Solutions as its financial adviser, and the company recommended that the municipality should bank with VBS Mutual Bank against the prescripts of the law.
The municipality later withdrew its money from VBS and didn’t even lose a cent.
Her foes then alleged that she received gratuitous payments totalling R575 600 from Gundo Wealth Solutions.
She has maintained that the money was a loan, which she has paid back with interest.
Simelane, in her submission to the commission, and to the president prior to her appointment, said she paid “Gundo Wealth Solutions an amount of R849 999, of which R575 600 was the capital amount outstanding and an amount of R274 399 in interest on the loaned amount.”
Simelane allegedly told the commission that Gundo Wealth Solutions also advised the municipality to invest in other institutions, such as Standard Bank, Sanlam, Nedbank, Liberty, ABSA and Investec.
“The municipality subsequently reviewed its investments and withdrew all its money from VBS Mutual Bank, together with interest on investment, and did not lose a single cent, following its collapse,” said Simelane .
She added that Gundo Wealth Solutions was appointed by the municipality as an investment manager under strict conditions that it “wouldn’t be paid an administration fee nor any other fees for the advisory services”.
“Gundo Wealth Solutions was not a typical contractor of the -municipality, in the strict sense of the word, in that municipality did not pay Gundo Wealth Solutions for services rendered,” Simelane stated.
She also said she informed the president that she saw a business opportunity to own a coffee shop and established a company, T5 Investment Group, in July 2016.
Simelane stated she first intended to take money out of her retirement savings and invest it in the coffee shop but she was advised against it because of the “levies, surcharge, taxation and penalties that would arise on withdrawal of the retirement savings”.
She then turned to Gundo Wealth Solutions for the loan, which her company, finalised and signed on September 30, 2016. She informed the president that she repaid the loan in full, plus interest.
The minister also submitted the proof of her loan repayment to the president. The first payment was on October 9, 2020; the second instalment was on November 12, 2020; and the last payment was on January 7, 2021.
“T5 Investments Group repaid Gundo Wealth Solutions an amount of R849 999, for which R575 600 was the capital amount outstanding and an amount of R274 399 was interest on the loaned amount,” the minister explained in the report.
Simelane denied there was a conflict of interest because the municipality made its initial investment with VBS Mutual Bank. She added that her relationship with Gundo Wealth Solutions ended on January 7, 2021, when she paid them the last instalments.
The Integrity Commission is expected to release its findings on the case before month-end.
