DA finance chief Mark Burke has defended his company’s dealings in cryptocurrency offshore, which has left it at odds with the Reserve Bank, leading to his stepping down from critical finance committees in Parliament.
Kastelo, a company Burke founded with his brother, who is CEO, has been at loggerheads with the SA Reserve Bank after it moved about R4-billion offshore through cryptocurrency trades, in what is considered a contravention of South Africa’s exchange control rules. The cryptocurrency fintech’s bank accounts were frozen. Kastelo’s application to review and set aside the SARB’s blocking order was dismissed by the high court in Johannesburg.
Burke has been forced to step down from the standing committee on finance, and as an alternate member of the standing committee on appropriation.
However, he has refused to relinquish the influential position as DA finance chief.
This week he dug in his heels in an interview with Alec Hogg of BizNews, saying that although people were justified in having an emotional response to the amount of money involved in the SARB investigation, the funds would ultimately return to the country.
“The amount of money involved is not an amount that has been somehow syphoned out of the country forever.
“In fact, it’s the exact opposite. Any business looking to import something is doing so because they hope to attain a lower price for that purchase in a foreign place and then to sell it for a higher price locally. And so value would leave in one form, being the currency payment for that good, and it would return in another form being the good being sold here. And in this case, the good that was purchased was cryptocurrency, either Bitcoin or stablecoin,” he said.
Burke also made it clear that he intended to remain in his position as the DA’s federal chairperson of finance, saying he was “not going anywhere”.
“I will throw my weight behind the DA and getting this election done and making sure that we deliver a bigger vote share than we ever have. And I’ll continue trying to manage the party’s finance as well.”
The DA initially moved to push back when Business Day first reported on Burke’s battles with the Central Bank.
Party insiders said the reversal was driven by concern that the controversy had become a political liability before the local government elections.
The dispute was not only about the merits of the SARB investigation but also about how the party should respond to allegations involving its federal finance chairperson.
A senior DA source said the initial instinct among some leaders was to defend Burke because there had been no finding that he or Kastelo had committed wrongdoing.
“People were saying we cannot throw Mark under the bus when there is no finding against him,” the source said.
But other senior figures argued that the party needed to act before the controversy damaged its credibility on financial accountability.
“Once this became a question about trust and perception, the calculation changed,” the source said.
The insider said the split became particularly visible after DA leader Geordin Hill-Lewis publicly supported Burke.
“After Geordin threw his support behind Mark, with some of the officials siding with him, things got messy on the other side as some top leaders pushed back and demanded action against the federal chairperson,” the source said.
“Geordin was told that he had missed the mark by shielding Mark over his involvement in the R4-billion scandal. Two camps in the DA leadership, with one siding with Geordin to shield Mark and the other faction demanding action, had a go at each other.”
DA spokesperson Jan de Villiers declined to comment.
- DA finance chief Mark Burke defended Kastelo’s offshore cryptocurrency dealings involving R4-billion, which the SA Reserve Bank contends violated exchange control rules.
- The SA Reserve Bank froze Kastelo’s bank accounts and successfully had the high court dismiss Kastelo’s application to overturn the freezing order.
- Burke stepped down from two parliamentary finance-related committees but retained his role as the DA’s federal chairperson of finance.
- The DA leadership was divided on handling the controversy, with DA leader Geordin Hill-Lewis supporting Burke while other senior members called for action against him.
- The dispute and differing responses within the DA occurred amid concerns about the party’s credibility on financial accountability ahead of local government elections.
DA finance chief Mark Burke has defended his company’s dealings in cryptocurrency offshore, which has left it at odds with the Reserve
Kastelo, a company Burke founded with his brother, who is CEO, has been at loggerheads with the SA Reserve
Burke has been forced to step down from the standing committee on finance, and as an alternate member of the standing committee on appropriation.
However, he has refused to relinquish the influential position as DA finance chief.
“
“In fact, it’s the exact opposite.
Burke also made it clear that he intended to remain in his position as the DA’s federal chairperson of finance, saying he was “not going anywhere”.
“I will throw my weight behind the DA and getting this election done and making sure that we deliver a bigger vote share than we ever have.
Party insiders said the reversal was driven by concern that the controversy had become a political liability before the local government elections.
A senior DA source said the initial instinct among some leaders was to defend Burke because there had been no finding that he or Kastelo had committed wrongdoing.
“People were saying we cannot throw Mark under the bus when there is no finding against him,” the source said.
But other senior figures argued that the party needed to act before the controversy damaged its credibility on financial accountability.
“Once this became a question about trust and perception, the calculation changed,” the source said.
“After Geordin threw his support behind Mark, with some of the officials siding with him, things got messy on the other side as some top leaders pushed back and demanded action against the federal chairperson,” the source said.
“Geordin was told that he had missed the mark by shielding Mark over his involvement in the R4-billion scandal. Two camps in the DA leadership, with one siding with Geordin to shield Mark and the other faction demanding action, had a go at each other.”
DA spokesperson Jan de Villiers declined to comment.
