Monday, September 30, 2013

'Offensive' Zuma painting sold

No Fear No Favour No Regrets.......



JACKIE MAY SOUTH AFRICA 30 SEPTEMBER 2013 00:04







Artist Ayanda Mabulu. File photo

Ayanda Mabulu's painting Yakhal'inkomo - Black Man's Cry has been sold.




Following the highly publicised banning and unbanning of the painting at the Johannesburg Art Fair, it sold for the asking price, R89 000.
Greg Dale, curator of the Cape Town Commun.1 Gallery, confirmed that a private collector had bought the painting.
The fair's organisers, Ross Douglas and Cobi Labuschagne, banned the painting but reversed their decision when photographer David Goldblatt removed his exhibition in protest. Both their works were rehung on Saturday.
"We couldn't sell the work to a higher bidder if he'd already paid," said Mabulu, adding that this was not the highest price paid for one of his paintings.
The mixed-medium painting is about last year's Marikana massacre. It shows President Jacob Zuma's dog attacking a miner as Zuma is about to stand on the head of another miner as a concerned-looking Julius Malema looks on.
Commune.1 said the reversal of the ban was a victory for freedom of artistic expression.

TIMES LIVE 

COMMENTS BY SONNY

CONTROVERSY SELLS IN SOUTH AFRICA.
IT SOLD FOR THE SAME AMOUNT AS THE ONE OF ZUMA DISPLAYING HIS PENIS IN PUBLIC SOME
TIME AGO.
ART LIKE CRIME PAYS!!

Dodgy deal puts SA troops at risk

No fear No Favour No Blood Diamonds please........




GRAEME HOSKEN SOUTH AFRICA 30 SEPTEMBER 2013  00:04






A series of damning military reports highlights alleged multimillion-rand tender irregularities said to have endangered thousands of South African troops battling rebels across Africa.



The reports into the operations of a Johannesburg logistics company include a restricted UN document, and e-mails from Free State border control officials and Airport Company of SA officials - all of which the military's top brass appear to have ignored.
The documents deal with the operations of Y&P Logistics - one of the SANDF's top-five service providers. It supplies heavy-lift transport aircraft.
The age and condition of the military's own heavy-lift aircraft has forced the Defence Department to contract private aviation companies to transport equipment and men to missions in the Democratic Republic of Congo and the Central African Republic.
The reports call for an investigation into Y&P's continued securing of tenders despite:
It not being an aviation firm;
Operating aircraft with no serial number; and
Using certain aircraft that have no technical documentation, and an aircraft not approved by the SA Civil Aviation Authority.
Y&P Logistics director Seelan Padayachy said: "This has never been raised with us ... All the aircraft we use are from reputable suppliers.
"If the SANDF is so concerned, why are we continually short-listed as a preferred service provider?"
SANDF spokesman Brigadier-General Xolani Mabanga failed to respond to questions.
The documents raise a series of concerns and reveal incidents such as the alleged partial shut-down of Rwanda's Kigali Airport, failure to deliver reinforcements and equipment on time to South African paratroops fighting in CAR's Battle of Bangui, the continued flying of a troop-carrying aircraft despite a mid-air emergency that might recur, and the landing of an aircraft at Bloemfontein Airport after it had closed for the night.
One of the reports - written in June for Lieutenant-General Derrick Mgwebi, chief of the SANDF's joint operations division - called for an investigation into the awarding of a R23-million tender to Y&P to airlift supplies and troops to soldiers fighting in Bangui, CAR.
Another company, despite being able to supply the required aircraft on time and at a cost of R15-million, lost out on the contract
Y&P had to provide a Boeing and an Antonov but was unable to do so for several days. It took nearly two days to get the reinforcements to the area and six days to supply troops with armoured vehicles and fuel.
Fifteen South African soldiers died in the battle.
"Y&P entertained some SANDF members with a function at the Carousel Casino ... it might be necessary to investigate the relationship between the company and relevant role players ..."
The documents' author requested an investigation after a diplomatic incident at Kigali Airport when an aircraft chartered by Y&P crashed while transporting army vehicles.
The aircraft involved in the crash was not approved for use by the Defence Department.
Rwandan authorities impounded the armoured vehicles being carried by the aircraft, which had been destined for troops battling M23 rebels in the DRC town of Goma.
The report revealed that the inclusion of Y&P on the SANDF's supplier database was questionable because the company had not complied with contractor requirements.
"Since the inclusion [of Y&P], the Department of Defence was, and is still, faced with a magnitude of challenges concerning non-compliance on the contract for the past two years."
The documents state that one of the requirements of the two-year contract was that all the technical documents for each aircraft were to be submitted to the Defence Department and the Civil Aviation Authority during the evaluation process.
"Compliance to this criterion is crucial for aviation safety [and the soldiers' safety].
"The company did not submit detailed information in respect of its experiences in the air-transport industry ... due to [it having] no previous aviation experience.
"Due to the non-compliance with lease agreements, which are compulsory, the company sources aircraft from sub-contractors regularly in an unknown manner ... these subcontractors are not vetted by Defence Intelligence, or cleared by the SACAA, and place the Defence Department [passengers and cargo] in danger."

TIMES LIVE 

COMMENTS BY SONNY

SA Troops should have been out of the CAR a long time ago.
The SA president should be personally held responsible for this sorry state of affairs.
HOW MUCH MORE TENDER FRAUD WILL BE DETECTED HERE?
WHOSE HEAD MUST ROLL FOR THIS DISASTER?
THE COMMANDER-IN-CHIEF!!
WE ARE FIGHTING A DESPOTS WAR IN THE CAR





A luta continua: defending Malema and Mabulu’s right to express themselves

No fear No Favour No Secrets.......


STEPHEN GROOTES SOUTH AFRICA  30 SEPT 2013 01:57







South Africa, and South Africans, value freedom. Some might be skeptical of this claim and believe that the water in this particular pot is heating up without us noticing. But scratch deeper, and you are bound to discover that things don’t happen in this country if citizens get angry enough. The censorship last week of Julius Malema and artist, Ayanda Mabulu, has underscored the point that South Africans remain freedom fighters. The country is always going to be bigger than our politicians. By STEPHEN GROOTES.




Ayanda Mabulu and Julius Malema would probably make for difficult dinner guests. It would not be an easy meal. Discussion would probably be loud, rambunctious, and in your face. All the time. Sensitive souls might find much of the discussion, and its imagery, difficult to stomach. They are, after all, extremists in their own way. And how a society deals with its extremists tells you everything you need to know about them.
On Thursday, Malema was barred from speaking at Unisa’s campus. He had been told that a meeting he was due to address had been cancelled. On Friday, during an interview on the Midday Report, Unisa attempted to explain why this action had been taken. The university explained that two organisations on campus, the union NEHAWU, and the students’ political group, SASCO, had made it plain that they would protest and stop Malema from speaking.
Just to be clear here, both of these groups are affiliated to the ANC. And it doesn't matter whether this action was mandated by Luthuli House or not, these were ANC people saying they would stop someone from exercising their right to freedom of speech.
Unisa's response was to cancel the meeting on the grounds that there was the strong prospect of "damage to people or property". Based on the view of their security staff, the university reckoned it would be dangerous to allow Malema's speech to go ahead, not because of what he would say, but because of the possible reaction just to his presence.
Unisa was wrong. It was a total abrogation of its reason for existence as a university; that is, to discuss facts and knowledge and to produce new knowledge. In all societies political change begins in the cities. That's where people congregate and debate. And in most cases, change in the cities starts in tertiary institutions where students - young people with flexible minds and with the time and energy to think, speak, act, protest, demonstrate and ponder the future - first act as incubators of change.
Our universities should be centres of political activity, they should be places where we see the future, and whether it works or not.
And in these debates and discussions, words are almost all we have. Without words, we are left only with images and violence. And images, as Mabulu reminds us, and Brett Murray taught us, play a powerful role in our politics.
But for most people, it's about words. It's your words against mine, your ideas against mine, your thoughts and hopes for the now and the future against mine. Words need to be protected, almost above all else. Because without them we will descend into violence, and the lives of all our politicians will be nasty, brutish and short.
Unisa should have called out the army to defend Malema's right to speak. The university should have proudly proclaimed that its campus is a haven of ideas, thought, words and discussion. That it's not a place of the tyranny of thugs, where those who threaten violence rule the roost.
Instead, it decided to let two political organisations act as jack-booted censors. It allowed them to decide not just what can be said, but also what can be heard.
Unisa, and all its administrators, should be ashamed of themselves.
The other people who should be sitting in the naughty corner with Unisa are Ross Douglass and Cobi Labushagne. If you haven't heard of them before now, you're not alone. They're the two organisers of the Joburg Art Fair and who decided to remove Mabulu's painting, Yakhal'inkomo - Black Man's Cry from the exhibition.
It's a typical Mabulu image, in that ANC leaders feature in a way unlikely to see the painting in the reception area of Luthuli House. At least this time, President Jacob Zuma is wearing clothes. Even if it is a capitalist suit. Unfortunately for Douglass and Labushagne, he's also standing on the head of a Marikana miner, and holding the leash of a dog that is attacking another one.
Douglass and Labushagne decided this was too controversial for them and removed the painting. Really, what did they expect, for goodness’ sake? It's a Mabulu painting. It's the usual problem with the suits in the media and art worlds. Everyone wants to own the content that's “out-there”, “extreme” or the talk of the town. That's how you make money. But no one wants to be left carrying the can when the reaction rolls in.
They claim they didn't want to offend any politicians who would be attending, because some of their funding comes from government. Well, there's the first problem. Art and governments don't mix. That's kinda the point of art. Government is by definition the establishment. Artists, also by definition, are anti-establishment. And so the two will always collide.
And we shouldn't always be so scared about the reaction of the ANC. Sure, what happened during the fracas around The Spear was scary. Gwede Mantashe telling thousands of people marching up Jan Smuts Avenue that "you've won in the streets what you couldn't win in the courts" is probably the most frightening use of populism we've yet seen. The tactic of Zuma always using the hurt and oppression of our country's majority as a self-defence cloak is still very effective.
But two weeks later when Zapiro drew Zuma as a penis in the Mail and Guardian, Mantashe hardly blinked. The Goodman Gallery itself is still fighting, as its director, Liza Essers, happily sailed back into the fray on Saturday, calling against a culture of self-censorship, and reminding everyone that it is the duty of those arranging art-exhibitions to fight censorship whenever they see it.
And, don't forget, the ANC itself is not one homogenous grouping. Arts and Culture Minister, Paul Mashatile, is no big Zuma fan, and is unlikely to have immediately called for hell and damnation to rain down on the Joburg Art Fair. Kgalema Motlanthe would probably have looked at the image and been very dignified in explaining what it tells us about ourselves as a nation.
In the end, as we all know by now, David Goldblatt removed his pictures from the Fair, and so ensured that Mabulu's work was restored to its rightful place.
And this is really the moral of our story. That this country does not allow people to take its freedom away that easily. That we are a big place, with lots of different views. That if you act in a way that takes away freedom, often the reaction will lead to more freedom.
If you censor something in our country today, you are simply asking for those who can, to tweet and re-tweet, show and re-show, copy and re-copy that image, that idea, that thought. You are calling on all of us to be revolutionaries, to oppose, to protest and to demonstrate.
In South Africa, when you try to ban, censor and to stop us, you just make us stronger. DM
Photo: Julius Malema gestures during an interview with Reuters in Johannesburg this year. REUTERS/Siphiwe Sibeko
Grootes is the host of the Midday Report on Talk Radio 702 and 567 Cape Talk, and the Senior Political Correspondent for Eyewitness News. He's been part of the political hack pack since before the Polokwane Tsunami, and covers politics in a slightly obsessive manner. Those who love him have recommended help for his politics addiction. He quotes Amy Winehouse.


DAILY MAVERICK



COMMENTS BY SONNY

Zuma's  nemesis.....

THE MAN WHO KNOWS ZUMA'S DARKEST SECRETS AND THOUGHTS.

LUTHULI HOUSE RESOUNDS LOUDER THAN OUR ALLEGED DEMOCRACY!

UNISA HAS FAILED THIS NATION!!

DICTATORSHIP HAS SHOWN ITS UGLY FACE ONCE AGAIN!

THE DOMINOES ARE ABOUT TO FALL!

THE SELL OF SULPHUR IS IN THE WINDS......OF CHANGE ONCE AGAIN!

WE MUST FIGHT UNTIL THE LAST STANDING FOR OUR DEMOCRACY!


South Africa a breeding ground for terrorists?





.
One thing is for certain; terrorist cells that have successfully entered into South Africa

SA a breeding ground for terrorists?

30 September 2013, 07:48

For years rumours have been circulating about South Africa being the perfect hideaway for well-known (and the not so well-known) terrorists of Al-Qaeda.
In 2008, Hilary Clinton criticised South Africa that its lax regulations had allowed for Al-Shabaab and the like to recruit young Somali-South Africans.
In 2011, word got out that a Hamas terrorist cell had actually opened “offices” in Cape-Town.

At the beginning of 2013, News24 and The Daily Maverick reported news of alleged Al-Qaeda training facilities that had been operating in a former police training base in the Klein Karoo, in Vlakplaas and another unknown area in the Eastern Cape.

This report resulted in mounting pressure from both the USA and Britain for the South African government to get a handle on the situation and act as “quickly as possible.”
However the government did not heed their warning and continued to allow these dangerous terrorist cells to go on with their training routines.

It was only a few days ago when the news emerged that Samantha Lewthwaite, (otherwise dubbed the ‘White Widow’,) who is wanted in connection with the Westgate Mall terrorist attack in Kenya and has been using and travelling on a South African passport, that the government finally broke their silence.

Lewthwaite, whose husband had been one of the notorious 7/7 bombers, was living in South Africa under the name Natalie Faye Webb. She had been working as an “IT specialist” at a Halaal pie factory in Lenasia. She had been earning a salary of R25 000 a month and was living in Bromhof. She had bank accounts and unpaid debts that ran into thousands of Rands.

Whilst living in South Africa, Lewthwaite had also been a part of suspicious activities which included watching and photographing a number of Foreign Embassies in Pretoria. These strange activities have only now been dubbed suspicious when this had been going on for months.

Only after all these details had emerged did the Minister of Home Affairs, Naledi Pandor, come out and say that she together with the SA intelligence unit are investigating how Lewthwaite managed to slip through undetected.

The South African border control in South Africa is somewhat similar to that of Kenya and Somalia. After Thabo Mbeki took over as President, he allowed for border regulations and control to lax completely. Like Kenya’s border with Somalia, there is no real border between certain parts of South Africa and its neighbours Mozambique and Zimbabwe because of the small but dense area of the Kruger Park. This has allowed a huge amount of illegal immigrants into South Africa and it is unknown if these terrorist cells are among those numbers.

This entire debacle has generated many worrisome questions; does the government and home affairs office actually have a screening process? Do they really look at who comes in and out of the country? How many more terrorists have just “slipped through” into South Africa undetected?

Furthermore, has its lax regulations and border control allowed for dangerous Al-Qaeda terrorists to enter, live and train in South Africa? And could these terrorists been the same ones that perpetrated the horrific Kenyan Mall attack?

The most troubling question of all; will we see a repeat of the Westgate Mall Attack on South African soil?

It is in the interest of both the government and its people to take the threat of the Al-Qaeda operatives like Samantha Lewthwaite seriously and start delving into who is being allowed into the country and under what grounds. Border security must not be taken lightly and the South African intelligence unit must work together with Interpol and the like if they are to crack-down and rid this country of the terrorist threat – a threat that also affects it citizens.
South Africa are assuredly living the good life undetected as a result of the lax laws in this country that have allowed them to flourish.
One thing is for certain; terrorist cells that have successfully entered into South Africa

SA terror alert not reassuring






EDITORIAL ( The Citizen )

Reports that South Africa has been placed on an orange-level terror alert do not inspire confidence.

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They contradict the lackadaisical response thus far to the activities of “White Widow” Samantha Lewthwaite, an alleged mastermind of the Westgate Mall massacre in Kenya.
Even yesterday Home Affairs Minister Naledi Pandor was quoted in the Sunday Times as trying to deny links between SA and the Nairobi incident which left at least 70 people dead. Astonishingly, as she is the person in charge of SA documentation, and this matter has been in the limelight for more than a week, she is still unable to say whether the SA passport used by Lewthwaite was of the new, supposedly more secure type.
“I’m not sure if it was under the old system or the new one. I would have to check on that”, she told the Sunday Times.
Surely she should have established this crucial fact before boasting about how the new SA passports are foolproof. The truth is no passport system is foolproof in the hands of corrupt officials, especially when those who seek to bribe them have unlimited funds, whether from poaching or from oil-rich potentates.
This laid-back attitude displayed by Pandor pervades our security establishment too. Their failure to get to grips with the likes of Al-Shabaab is due in
part to their preoccupation with domestic political battles, including keeping President Jacob Zuma out of jail. There is also a built-in resistance to any “war on terror”, as the ANC was once labelled a terrorist organisation.
They also don’t want to be seen doing the bidding of the US or, heaven forbid, Israel. The tip-off that Lewthwaite was conducting surveillance of embassies here came from Jewish sources. That will colour any follow-up.






Citizen
© 2013 The Citizen. All rights reserved.

Interpol issues alert for ‘White Widow’

CORRUPTION. A photo of the fake SA passport of Samantha Lewthwaite, the widow of suicide bomber Jermaine Lindsay who blew himself up on a London Underground train in 2005, killing 26 people. She may be in the terrorist cell behind the Nairobi mall massacre.
An Interpol red notice was issued on Thursday for fugitive Briton Samantha Lewthwaite dubbed the “white widow” who was allegedly involved in an attack at a mall in Nairobi, Kenya.
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The International Criminal Police Organisation (Interpol) said the red notice, which is an internationally wanted person alert, was issued at the request of Kenyan authorities.
“By requesting an Interpol red notice, Kenya has activated a global ‘tripwire’ for this fugitive,” Interpol secretary general Ronald K Noble said in a statement.
“Through the… red notice, Kenyan authorities have ensured that all 190 member countries are aware of the danger posed by this woman, not just across the region but also worldwide.”
She was wanted by Kenya on charges of being in possession of explosives and conspiracy to commit a felony dating back to December 2011. A picture of a South African passport with Lewthwaite’s photo and the name Natalie Faye Webb was distributed by Kenyan police.
Home Affairs Minister Naledi Pandor said the passport was fraudulently acquired. ”It [the passport] was investigated and reported on in 2011. It was cancelled at the time as it was found to be acquired fraudulently,” she told reporters in Pretoria.
Pandor said further investigations had to be done into the acquisition of the passport and how it was issued. ”What we need to do is look at the applications office and check who processed it and how that person met the requirements to be granted a passport.”
Noble said Lewthwaite’s case underlined the “invisible threat” posed by terrorists using illicit passports. ”Every year hundreds of millions of individuals are boarding international transport and crossing borders without having the authenticity of their travel or identity document checked,” he said.
“This dramatically compromises our ability to effectively screen and identify at airports and land crossings those individuals who could be suspected criminals and terrorists.” The 29-year-old woman was nicknamed the “white widow” after the death of her husband Germaine Lindsay, who was one of the four bombers involved in the July 7 attacks in London in 2005.
Al-Qaeda affiliated group Al-Shabaab has claimed responsibility for the attack at Nairobi’s Westgate mall on Saturday. Attackers held the mall for four days in a siege in which at least 67 people were killed.
It has been speculated that Lewthwaite was involved in the attack.
- Sapa
RELATED ARTICLES:
White widow passport ‘a fraud’
SA now a ‘safe haven’ target for terrorists



Citizen
© 2013 The Citizen. All rights reserved.

The Hawks lay complaint against NPA's Mrwebi



Johannesburg - The Hawks have laid a criminal complaint against an NPA official for the dropping of corruption charges against suspended police crime intelligence head Richard Mdluli, City Press reported on Sunday.

National Prosecuting Authority spokesperson Bulelwa Makeke confirmed to the newspaper that a complaint of defeating the ends of justice had been lodged against specialised commercial crimes unit head Lawrence Mrwebi.

She told City Press the docket was "under consideration" and that an investigation into the matter still needed to be concluded.

In November 2011 Mrwebi issued instructions to withdraw corruption charges against Mdluli.

On Monday the North Gauteng High Court in Pretoria overturned the withdrawal of charges against Mdluli. Judge John Murphy ordered that the criminal and disciplinary charges against Mdluli be reinstated. He described Mrwebi's decision as illegal and irrational.

City Press reported that a Hawks investigating officer involved in the criminal case against Mdluli laid the complaint.

- SAPA
Read more on: npa | richard mdluli | lawrence mrwebi | pretoria



National
Richard Mdluli: The rule of law and the failing state
SEP 2013 SAM SOLE ( Mail And Guardian )


The case against Richard Mdluli can be seen as a dry run for the DA's bid to have corruption charges against President Jacob Zuma reinstated.
Richard Mdluli. (Gallo)
General Richard Mdluli appears to be a dangerous man. The suspended crime intelligence boss, it will be remembered, is accused of abusing his position at the apex of one arm of the "secret state" to acquire and dispense personal benefit and political favour.

Mdluli allegedly had discounts due to the Secret Services Account transferred for his own advantage, presided over the appointment or promotion of friends and family as covert agents, and wrote to President Jacob Zuma, making allegations of political plots and offering a pledge of loyalty.

Nor should one forget the unresolved 1999 murder of his one-time love rival, Oupa Ramogibe, or the untested evidence of Mdluli's involvement in threats against Ramogibe's family and associates.

But the court battle finally beginning next week in the North Gauteng High Court in Pretoria is about much more than Mdluli's future. It also highlights a much wider danger than whether he returns to control one of the peaks of covert state power.

Next Wednesday, the nongovernment watchdog Freedom Under Law will attempt to have the courts step in to enforce accountability in one of the most profound tests of our constitutional architecture.

The watchdog is asking the court to order the National Prosecuting Authority (NPA) to reinstate corruption and murder charges against Mdluli and to order the national police commissioner to reinstate disciplinary charges against him.

The state exercises its coercive power mainly through the police and prosecutions system, which is why the checks and balances on these institutions are so important, and why the individuals wielding executive authority in these areas must be beyond reproach.

The separation-of-powers doctrine suggests that the executive, the judiciary and the legislature must be careful not to stray into each other's domains, which means that the courts will not easily substitute their own decisions for those who are duly authorised to make those decisions, such as prosecutors and police commissioners.

But that deference depends on two caveats: such decisions should not be subject to undue pressure, and decision-makers must, when required, be prepared to justify the decision in significant detail.

The discipline of justification is the core of the constitutional framework, of the very power of the courts. Without it, the Constitution is merely a set of ideals.

And it is not easy. The discipline of justification imposes a significant, if necessary, bureaucratic burden.

It requires the state to keep good records; it requires officials to know, understand and have regard for the changing landscape of laws and regulations that govern their conduct; and it requires that officials demonstrate this when legally called upon to do so, including disclosing all records relevant to that decision.

Resistance to the culture of justification is understandable – and not only when officials are trying to cover up wrongdoing. If the bureaucracy degrades, if the state begins to fail, officials find it harder to resist challenges to doing good things as well, such as going after tax cheats or deporting foreign criminals.

The courts face a tough choice: lower the bar for the state, or uphold constitutional obligations that may embarrass the state and add significant strain to the tension between the executive and the judiciary.

The Mdluli case is an important test of judicial resolve: almost a dry run for the Democratic Alliance bid to have the courts review the decision to withdraw corruption charges against Zuma.

It should be recalled that the Zuma administration set the scene for this showdown with a series of politicised appointments, including those of Mdluli himself, of the acting national director of public prosecutions, advocate Nomgcobo Jiba, and of the head of the Specialised Commercial Crime Unit, advocate Lawrence Mrwebi, the man who ordered the prosecution of Mdluli on corruption charges to be withdrawn. And then, the acting-commissioner, Lieutenant-General Nhlanhla Mkhwanazi, dropped disciplinary proceedings and reinstated Mdluli in March 2011 after a meeting with Police Minister Nathi Mthethwa.

He later attributed this decision to authorities "beyond" him.


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Mdluli ruling affects Zuma - expert
2013-09-26 23:12

Richard Mdluli (Picture: Beeld)
Richard Mdluli (Picture: Beeld)
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Cape Town - A court ruling overturning the withdrawal of charges against former police crime intelligence head Richard Mdluli has implications for President Jacob Zuma, an expert said on Thursday.

The judgment, which also ordered national police commissioner Riah Phiyega to restore disciplinary proceedings against Mdluli, was made on Monday by Judge John Murphy in the North Gauteng High Court in Pretoria.

Mdluli was suspended amid charges of fraud and corruption, and charges relating to the murder of his former lover's husband.

An inquest cleared him of any involvement in the murder.

The National Prosecuting Authority (NPA) later withdrew charges of fraud and corruption. He was reinstated, but was suspended again in 2012 pending Freedom Under Law's (FUL) court application.

Political analyst Richard Calland told the Cape Town Press Club on Thursday: "Justice John Murphy's judgment in the Mdluli case is extremely important for its extrication of the law.

"If Justice Murphy's approach is affirmed, then the outcome of the review case from the Democratic Alliance of Zuma is likely to go the same way, which means the charges will be reinstated."

Calland was referring to the DA's application to access "spy tapes", transcripts, and other documents that relate to a 2009 NPA decision to drop corruption charges against Zuma.

‘Spy tapes’

Last month, the North Gauteng High Court in Pretoria ordered acting national director of public prosecutions Nomgcobo Jiba to lodge a copy of the tapes with the registrar of the court within five days.

Zuma lodged an application for leave to appeal the following day, and this was subsequently granted by the South Gauteng High Court in Johannesburg.

Calland said that should charges eventually be reinstated against Zuma, the ANC might deem it inappropriate to have him in a leadership position and might manufacture a "relatively graceful departure".

He said Zuma might resist such a move and this could make him vulnerable.

- SAPA
Read more on: police | npa | anc | ful | richard mdluli | riah phiyega | jacob zuma | pretoria | zuma spy tapes | crime
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Hawks to probe Mbete Gold Fields deal
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Saturday, September 28, 2013

Terror link to poaching in Africa

No fear no Favour No Poaching or Terrorists Please..........






FILE - A woman who had been hiding during the gun battle runs for cover after armed police enter the Westgate Mall in Nairobi, Kenya. (AP Photo/Jonathan Kalan, File)



Johannesburg - The illicit ivory trade may have partly funded militant Islamic group al-Shabaab’s terror attack in Kenya this week, according to an international conservation group.
The Elephant Action League (EAL), which has investigated the terror group’s links to elephant and rhino poaching in Africa, said the group derived up to 40 percent of its funding from the illegal trade.
“You can easily say that the terrorist activity in Kenya last weekend was funded by many sources, one of them ivory,” Andrea Costra, EAL executive director, told the Saturday Star.
“We need to become a bit more confrontational with China, which is the origin of problem, because they are buying most of the ivory.
“The question for the Chinese buyer is when they go to a shop in Beijing full of ivory, that it is used to fund the terrorist attack in Nairobi that killed pregnant women and children, that you as an ivory consumer are funding the operations of al-Shabaab. You are an accessory to manslaughter and the criminal courts should try you as well.
“If you buy ivory or rhino horn, you kill people. It’s very sad that you need a terrorist attack like this where dozens of people are killed to start talking about this…”
iol news 28 sep SA ss poaching Kenya link pic
A Kenya Wildlife Service (KWS) Ranger inspects smuggled elephant ivory tusks in Mombassa Kenya. Al-Shabaab is said to be funded in part by ivory poaching. (AP Photo/ Gideon Maundu.)
AP
In Africa’s White Gold of Jihad: Al-Shabaab and Conflict Ivory, co-author Costra writes how al-Shabaab earned up to R6 million monthly through illegal ivory sales.
Little attention is being paid to the ways in which al-Shabaab is financing its activities, he said.
“In effect, ivory serves as one of the lifelines of al-Shabaab, enabling it to maintain its grip over young soldiers, most of whom are not radically motivated.
“Unlike other militants in Africa that deal with ivory and poaching, al-Shabaab does not kill elephants directly,” he told the Saturday Star.
“We’ve been told some traffickers in Kenya still prefer to sell to al-Shabaab because they don’t just pay well, but they pay on time and are very good businessmen.
“In Somalia, al-Shabaab is using the same channels to smuggle charcoal to Dubai to export ivory and resell it to intermediaries and it’s then shipped to the Far East.
“We’ve had confirmation in the past that whenever rhino horn is available they also buy it.”
Richard Thomas, of wildlife trade monitoring group Traffic, said: “We don’t have direct evidence ourselves of al-Shabaab being associated with these groups. There’s a lot of speculation about the links between elephant poaching and terrorist groups.”
Meanwhile, Anneli Botha, a senior researcher on terrorism at the Institute for Security Studies, said terrorists viewed South Africa as a safe haven.
“Countries that used to be safe havens found themselves being targets. You can’t say it will never happen to us.
“We have a responsibility to our own national security. We can’t turn a blind eye if an attack is planned from our own soil. We have examples like the Henri Okah case where he came here and planned his attacks (in Nigeria) from here.”
It was easy to stay under the radar in South Africa. “It’s so open, easy, and nobody asks questions. It’s a very diverse country, which also provides people with the opportunity to… literally disappear within the masses. Nobody cares.”
Terror suspect Samantha Lewthwaite disappeared in the three years she spent flitting in and out of South Africa. Neighbours told the Saturday Star this week they barely noticed her at her rented properties in Randburg and Mayfair.
But the Briton, dubbed the “White Widow”, has drawn worldwide attention. On Thursday, Interpol issued a Red Notice for the fugitive, who has been at the forefront of speculation over her alleged involvement in the Kenyan Westgate siege. There has been no official confirmation that she was involved.
Interpol said the Red Notice, an internationally-wanted-person alert, was issued at the request of Kenyan authorities.
Lewthwaite, who travelled to South Africa on a fraudulent passport, is wanted by Kenya on charges of being in possession of explosives and conspiracy to commit a felony, dating back to December 2011.
The passport was issued in Durban and last used in February last year. Since then it had not been used as Lewthwaite had been classified as a terrorist, said Home Affairs Minister Naledi Pandor.
For Botha, the Kenyan attacks were personal – a day before the siege she returned from three weeks spent in Kenya, training its anti-terrorism unit.
“It’s surreal. You think of the friends you’ve made and your colleagues. It’s heartbreaking.”
A Middle Eastern expert, who did not want to be named, said: “Al-Shabaab is on the back foot and are losing territory. The only way to stay in the forefront and remain current is to carry out attacks such as the one in Kenya. So you can be sure that there will be more violence attacks and more death.”
Saturday Star


Comments by Sonny

THIS PRACTISE COMES FROM THE DARK DAYS OF APARTHEID.
NOW THE PLAYERS ARE ALL UNITED IN CRIME, CORRUPTION AND TERROR!!
THE AFRIKANER "VERRAAIERS" ARE EVERYWHERE.


Friday, September 27, 2013

SARB on drive to warn public about Ponzi schemes

SARB on drive to warn public about Ponzi schemes
Friday 27 September 2013 08:14

SABC




The Reserve Bank has appointed temporary inspectors for 75 cases relating to illegal deposit taking.(SABC)
TAGS:
PretoriaReserve BankFSBNCRHlengani MathebulaPyramidPonzi

The Reserve Bank has warned the public against getting involved in illegal deposit-taking schemes also known as pyramid or Ponzi schemes.

It says the economic consequences of being involved in such schemes are far reaching. Last year the bank received a number of complaints and appointed temporary inspectors for 75 cases relating to illegal deposit taking.

On Thursday, the Reserve Bank launched a national campaign to raise awareness around such activities. The bank's head of group strategy and communications, Hlengani Mathebula says: "If anything comes to you with unreasonable returns, all you have to do is a basic thing, is this thing from a registered institution.”

Mathebula says a registered institution will be either by the FSB, the National Credit Regulator and the South African Reserve Bank.
“You just need to take a little bit of time and make the necessary calls. You don’t have to go and invest in a particular registered financial advisor but that financial advisor can give you an advice that will allow you to decide that I’m not going into this space.”

Reserve Bank launches anti-pyramid scheme campaign

Author: Julius Cobbett
28 June 2012 16:23
Reserve Bank launches anti-pyramid scheme campaign



Investigations are lengthy and prosecutions few; thus prevention is better than cure.

If you fall victim to a pyramid scheme, it is unlikely that the authorities will have much success in getting your money back. Once liquidators and their attorneys have feasted on the carcass, there is seldom anything left for investors. Schemes are known to collapse long before the Reserve Bank has arrived at any conclusions of wrongdoing. And successful prosecution of perpetrators is rare.

Seemingly aware of these problems, the Reserve Bank has embarked on a campaign to educate citizens on how to spot and avoid pyramid, illegal deposit-taking, and other dubious schemes.

Educational advertisements will be aired on radio and television and journalists have been asked to assist in getting the message across. The campaign message is: Beware of oMashayana (crooks). If it sounds too good to be true, it probably is. Speak to your bank or an authorised financial services provider.

Speaking at a media briefing held in Johannesburg on Thursday, Hlengani Mathebula, Group Head of Strategy and Communications at the SARB cautioned the public against illegal deposit-taking schemes. Mathebula says these schemes target the vulnerable, such as pensioners and people who have available cash from bonuses, death benefits, RAF payouts etc.

But Mathebula also noted that the rich and financially savvy are not immune from pyramid schemes. It is difficult to forget the list of businessmen who were allegedly conned by Barry Tannenbaum for example.

Mathebula declined to answer a question asking him to list some recent successful prosecutions of pyramid-scheme kingpins. He acknowledged that the prosecutions issue is a “big problem”.

Similarly, Reserve Bank investigations into dubious scheme can take years, and the schemes are known to collapse before action can be taken. Mathebula responded that the length of investigations is the result of the complexity of the scheme in question. Mathebula says that it is important to be thorough, and follow every possible lead to ensure that the scheme does not resurface in another guise.

To illustrate the lack of faith some people have in criminal prosecutions, consider a recent statement made by Hans Klopper, the business rescue practitioner appointed to a number of property syndication schemes promoted by Pickvest (formerly Picvest and PIC Syndications).

The Pickvest syndication structure was placed under business rescue before the Reseve Bank could conclude an investigation to determine whether its schemes were illegally accepting deposits.

In response to a question about criminal prosecution, Klopper wrote: “Insofar as you have made reference to possible criminal prosecution we believe that this is fact the most unlikely of outcomes that will benefit the investors. Having said this, it has been brought to my attention that there has not been a successful criminal prosecution for a commercial crime in Gauteng during the last two years. It would, likewise, become a costly exercise and I am not sure how this will in any event benefit investors.”

The Reserve Bank invites people to report suspected illegal deposit-taking (Pyramid or Ponzi) schemes to sarb-banksup@resbank.co.za. Alternatively call 0800 677 772 or SMS the Primedia Crime line on 32211.

Topics: Hlengani Mathebula, Pyramid schemes, Reserve Bank, Pickvest, Hans Klopper, PIC Syndications

The greedy feed well off your billions

The greedy feed well off your billions

September 2013
By Bruce Cameron

Illustration: Colin Daniel
Related Stories
Protecting your retirement savings
Billions of rands have been lost to retirement fund members over the past 20 years because of the excesses of an industry that all too often has seen retirement savings as a source of easy profits. Your retirement savings have been subjected to theft by individuals, employers and even trade unionists, and regulatory structures have too often failed you.

Bruce Cameron, associate editor of Personal Finance, who was speaking at a meeting of the Acsis/Personal Finance Financial Planning Club, says that attacks on your retirement savings seem to be becoming more regular and ever greater in scale as the R1.3-trillion industry (which excludes state pension funds) gathers ever more assets.

However, Cameron says, the main reason most retirement fund members do not retire financially secure is not because of the abuses of the industry, but because they fail to save enough, fail to preserve their savings for retirement, and retire too soon.

The abuse and theft of retirement savings adds to the problem.

And he adds that most retirement funds are managed properly. The problem is that when there are attacks on your retirement savings, they tend to be singularly significant and can wipe out your entire nest egg.

Cameron warned that unless a stop can be made to the excesses – both legal and illegal – the willingness of individuals to use retirement savings vehicles could be compromised.

He says that the regulators and other gatekeepers, such as retirement fund trustees and service providers, have to improve their vigilance and often their ethics too, to better protect your retirement savings.

And members themselves also need to play a role in ensuring those with ill intent are kept at bay.

Cameron says a key issue is that all parties have to accept that the money in retirement funds is not theirs to treat as a feeding trough. This is money that belongs to individuals, who have worked hard to save the money.

The billions of rands lost to retirement fund members have been due to:

* Theft and fraud, compounded by a failing justice system, with offenders often either not being prosecuted or getting off lightly. An example is the way in which fraudster Arthur Brown escaped a prison sentence.

* Poorly designed, complex and expensive retirement products, structured on the basis of commissions for product floggers and company profits rather than in the interests of retirement fund members.

* Poor regulation, inept or untrained trustees, and inefficient service providers, particularly retirement fund administrators (see “Protection should come from diverse sources”, below).

Cameron says a major underlying cause of the losses is the uncontrolled presence of conflicts of interest. These include employers controlling pension funds in their own interests, through to one-stop business structures where one company provides all services to a retirement fund, acting as fund consultants (which should include advising on abuses by service providers) while also providing services such as asset management and risk assurance.

Cameron says that if conflicts of interest were minimised, it would go a long way to stopping abuses. (See “Conflicts of interest at root of disasters”, below).

CONFLICTS OF INTEREST AT ROOT OF DISASTERS

Conflicts of interest, which underlie almost every retirement fund disaster, must be more strictly controlled, says Personal Finance associate editor Bruce Cameron.

He says a conflict of interest in this context is a situation where outside financial interests or obligations (real or perceived) have the potential to bias a decision or cause harm to retirement funds and their members.

“The Financial Services Board (FSB) issued a guidance note (PF130) to retirement fund trustees a number of years ago admonishing the trustees to avoid conflicts of interest.

“Despite this, avoidable conflicts of interest underlie almost every attack on retirement fund savings,” Cameron says.

The guidance note states that trustees “should distinguish between conflicts of interest which may be structural, and therefore unavoidable, and those conflicts which can be avoided or, if this does not compromise the credibility of the governance arrangements, can be managed appropriately”.

Cameron says Fidentia is a major example of what can go wrong.

Fidentia bought an umbrella trust fund, which managed the benefits due to widows and orphans of retirement fund members. It renamed the trust the Living Hands Umbrella Trust and appointed new trustees, who were all senior executives of Fidentia.

The trustees took a decision to transfer the management of all assets from Old Mutual to Fidentia Asset Management, whose directors, again, were senior executives of Fidentia.

The benefits of the widows and orphans “evaporated” while under the care of Fidentia Asset Management.

A more recent example of conflicts of interest causing a problem is the Rockland Group in Cape Town controlled by an advocate, Wentzel Oaker, who, with others, controlled two companies called Rapicorp 122 & 123, which bought the desolate Schaapkraal sand dunes outside Cape Town for R36 million.

The property was then sold, at R224-million profit, to Rockland Targeted Development Investment Fund (TDIF), managed by Rockland Investment Managers (RIM) which, in turn, was controlled by the Rockland Group.

By December 2010, the property was valued on the TDIF books at R980 million.

Rockland Investment Managers received an asset management fee of two percent plus 20 percent of returns above the inflation rate from TDIF – so the higher the value, the more it earned.

Cameron says that retirement funds often pick up problems because they use consultants that are conflicted.

He says these consultants fail to do their duty, because they should, in fact, be advising trustees when conflicts are avoidable, as recommended by the FSB’s PF130 advisory note.

A good recent example is asset management consultant Riscura.

Cameron says retirement funds, such as the Telkom and Sentinel mining retirement funds, pay Riscura to advise the fund trustees on the judicious management of their assets (the members’ retirement savings).

Riscura’s duties include advising the funds on which asset managers to use, which assets to invest in, which service providers to use for things such as ensuring investments are compliant with prudential restrictions, and effecting the movement of assets from one asset manager to another.

But Riscura, either directly or through one of its associated companies, is conflicted because:

* It receives fees for “transitioning” assets between fund managers. So the more often assets are switched between fund managers, the more it earns.

* It receives fees for “risk assessment “ from most but not all asset managers to which it has allocated funds. So the more asset managers from which it receives fees it recommends to retirement funds, the more money it will receive.

* It is involved in jointly managing investment portfolios where it shares in the fee. The more money that goes into these portfolios, the more it earns.

* It receives fees from many of the funds it advises for ensuring compliance with prudential investment regulations. In effect, it is often checking on itself.

* As Riscura earns money from these conflicted services, it could potentially tender its consultancy services at a lower rate than competitors that are not conflicted.

These conflicts have resulted in problems for retirement funds to which Riscura provides consultancy services. The problems include the following:

* A Riscura/Investec high-interest portfolio held R435 million in bonds in imploding company First Strut, on which Riscura was earning a fee.

* Riscura holds itself out as an expert in assessing risk – but it could not detect:

- The 20-year First Strut frauds; and

- The artificial property valuations and conflicts of interest in the Rockland saga, in which it advised retirement funds to invest.

Cameron says the question when it comes to companies such as Riscura, is: “Who guards the guards? The primary duty of a consultant is to guard.

“Also, the trustees of Telkom and Sentinel retirement funds and other Riscura-advised retirement funds cannot argue that resulting losses for individual members are ‘fractional’.

“Retirement fund members have a fiduciary duty to manage your retirement saving properly, and this includes avoiding conflicts of interest wherever possible.

“It is not that conflicts of interest mean that things will go wrong. Conflicts of interest raise the potential for things to go wrong and should therefore be avoided at all times,” Cameron says.

PROTECTION SHOULD COME FROM DIVERSE SOURCES

A significant problem in controlling the excesses of the financial services industry in managing the country’s retirement savings is the often poor regulatory oversight by both the regulators and other gatekeepers.

This is exacerbated when conflicts of interest that can be avoided are not avoided and when retirement funds use one-stop-shop structures, where a single service provider provides all or most services.

This, in turn, is compounded by retirement fund trustees who are not properly trained or badly trained by service providers, misled by service providers, or, in effect, bribed by service providers in numerous ways – from free trips abroad to gifts of iPads.

Personal Finance associate editor Bruce Cameron says the Financial Services Board (FSB) misses too many problems in the financial services sector. He says in many instances the FSB was warned of problems but failed to take timely action.

A major example was Fidentia, where the FSB was provided with proof by Personal Finance at least 18 months before the R1.6-billion collapse that all was not well at the company. The FSB should also have picked up and taken earlier action on others, including Fedsure, Ovation, Dynamic Wealth, Corporate Money Managers and the more recent Relative Value Arbitrage Fund – a Ponzi scheme posing as a hedge fund in which 3 000 investors stand to lose R2 billion.

But there are other gatekeepers, beyond fund trustees and the regulators, who have a statutory and/or fiduciary duty to protect your retirement savings.

Auditors are supposed to play a major role, but time after time fail dismally to pick up even blatant fraud. Lawyers often assist with scams rather than taking action to prevent them. Property valuators do the bidding of their paymasters in providing fanciful valuations. Banks should properly check out bond issues, such as the First Strut issue of corporate bonds, which was based on fraudulent information. Company directors, particularly independent directors, are supposed to act in the best interests of the company and, therefore, its shareholders. Credit rating agencies should properly assess risks, yet fail to pick up the biggest risk: fraud. And retirement fund consultants are supposed to assist in protecting retirement funds from the avaricious, but fail to do so because of their own avoidable conflicts of interest.

LITANY OF ATTACKS ON RETIREMENT SAVINGS

Personal Finance associate editor Bruce Cameron says that over the years the attacks on retirement fund savings have come from many different quarters. These include:

Fedsure

In 2001, financial services company Fedsure imploded, costing retirement fund members hundreds of millions of rands. The main reason was that senior executives were using retirement fund savings to build a financial empire, which collapsed when one of its main investments, Saambou Bank, failed.

However, there were other problems, including maladministration and the offering of investment guarantees that, to attract investors, were above market value.

The result was that members of building industry retirement funds lost 12 percent of their savings (R600 million), pensioners with guaranteed pensions received lower increases, and returns on smoothed bonus policies were reduced.

Secret profits

Alexander Forbes and other retirement fund administrators created structures that enabled them to skim off more than R500 million in secret profits. Most were made from bulking retirement fund bank accounts to earn extra interest.

Fidentia

Fidentia collapsed after the fraudulent use of R1.6 billion that belonged mainly to beneficiaries of deceased members of the National Union of Mineworkers Provident Fund. Most of the beneficiaries have been left destitute.

Glenrand MIB

In 2009, this company, which has now become part of the Aon group, liquidated its retirement administration arm rather than fix the mess it had created in administering 20 retirement funds with 80 000 members. This meant that the funds had to pay twice for the same job.

At the time, a former chief executive of the Financial Services Board (FSB) was on the Glenrand board.

Rockland TDIF

In 2007, an area of 480 hectares of undeveloped, windswept sand dunes in Schaapkraal, facing False Bay, was bought for R36 million through structures created by advocate Wentzel Oaker. The properties were then sold to Rockland Targeted Development Investment Fund (TDIF), a vehicle controlled by Oaker, for R260 million. Six retirement funds had invested R519 million in TDIF by the time it was placed under curatorship by the FSB. Investors were led to believe that the land, which didn’t have the correct zoning rights, would be transformed into a mini-city.

Dynam-ique/Aon

In 2011, the South African arm of Aon, the world’s biggest retirement fund administration company, was suspended for seven months from taking on new business. The reason was that umbrella funds it was administering, including four it had taken over from another administrator, Dynam-ique, were in an administrative mess.

The 11 000 members of the four Dynam-ique funds could lose 2.5 percent (R20 million) – the cost of rebuilding the records of the funds – of their savings. However, the Pension Funds Adjudicator has ruled that former trustees of the umbrella funds must meet the cost. The determination is set to be appealed.

The problems in the Dynam-ique funds have still not been resolved.

Trilinear/Canyon Springs

Five retirement funds associated with the Southern African Clothing and Textile Workers’ Union (Sactwu) stand to lose about R470 million as a result of major investment scams, leaving the funds unable to meet their commitments to their 25 000 or so members, who are among the lowest-paid industrial workers in the country.

The potential loss of R470 million is a result of the channelling of retirement fund assets through the Trilinear Empowerment Trust and then into failed investments, such as Canyon Springs and Pinnacle Point. Extraordinarily high fees were deducted as the money was directed through the various channels.

Associated with this failure is troubled asset manager Interneuron, which was placed under curatorship after it lost money investing in Trilinear and lost R500 million in rogue derivative trading.

There is a potential loss of R102 million for the Paper Printing Wood and Allied Workers Union (Ppwawu) National Provident Fund, which invested in Trilinear via Interneuron.

First Strut

The recent collapse of the country’s biggest unlisted company, First Strut, could see the loss of hundreds of millions of rands, mainly in bank loans.

However, there is also more than R800 million in retirement savings that were invested in First Strut corporate bonds by asset managers including Investec (R435 million), Sanlam (R236 million), Prudential (R51 million), Stanlib (amount unknown), Momentum (amount unknown) and Fairtree Capital (R131 million).

Unregistered products

Cameron says that, despite much legislation and a regulator with increased powers, products that should be registered and regulated still seem to elude the regulators. These include:

* Ovation. This asset manager imploded in the wake of losses of R200 million after investing in an unregistered money market fund, Common Cents. The money was stolen by Ovation owner Angus Cruickshank. No adviser checked whether Common Cents was registered as a collective investment scheme.

* Dynamic Wealth. The company, now shut down, operated a specialist income fund that posed as an investment club to avoid the limitations that the Collective Investment Schemes Control Act would have imposed on it. It invested R230 million in an unregistered money market fund managed by Corporate Money Managers (CMM). Instead of investing in money market instruments, CMM invested in property developments that failed, with potential losses of R1.1 billion.

Construction industry

Cameron says retirement fund members will, in effect, be the ones picking up much of the R1.46 billion in fines imposed by the Competition Tribunal on 15 construction companies, including the country’s five largest companies, which were found to be colluding on prices, particularly during the construction phase of the soccer World Cup. The reason is that retirement funds are major shareholders in these companies. More losses could follow, with anticipated civil action against the companies.

Employer attacks

* Non-payment of contributions. The non-payment of contributions collected from employees and due by employers to umbrella retirement funds is a growing problem. This has been exacerbated by the failure of the justice system to prosecute offenders and by the fact that offending employers often liquidate their companies.

Participating employers (security companies) in the Private Security Sector Provident Fund, an umbrella fund, have been the worst offenders.

Non-payment of contributions has an almost immediate impact on members, because the fund is primarily a provider of life and disability assurance to members, who are in a high-risk job as security guards. The non-payment of contributions by employers means the non-payment of premiums and the ensuing loss of assurance cover, leaving members and their dependants financially vulnerable in case of injury or death.

Changes to the law are being considered that will make employers and company directors personally both criminally and civilly liable for any non-payment of contributions.

* Surplus stripping. Currently under way is the criminal trial of Simon Nash, chief executive of industrial company Cadac, one of a number of employers that stripped surpluses from retirement funds in the 1990s, with the complicity of companies in the financial services industry.

Trade unions

Trade unions have found many ways to attack the retirement fund savings of their members, mainly by exerting excessive control over fund trustees, whom they often simply hire and fire to ensure that their bidding is done.

Things that have gone wrong:

* The SA Commercial, Catering and Allied Workers Union (Saccawu) National Provident Fund was placed under curatorship in 2002 after estimated losses of R1.7 billion for 90 000 Saccawu members.

* Commissions were paid by life assurance companies to unions for retirement fund risk assurance business.

* In 2007, the Ppwawu National Provident Fund trustees had to get High Court protection from the Chemical Energy Paper Printing Wood and Allied Workers Union, which tried to make them subject to decisions by the union management.

* Trade unions set up retirement fund service provider companies to provide services to their associated retirement funds, with the trustees being instructed to give mandates to these companies, which, in turn, mainly outsource the work, adding to costs.

Poor products

A mainly hidden cost for retirement fund members lies in poor products that are not suitable for their needs. Most of these are individual retail products, such as retirement annuity (RA) and preservation funds, rather than occupational retirement funds, with the exception of many umbrella funds, which are poorly structured.

Cameron says it is difficult to assess the total amount involved, but it would probably be many billions of rands. The causes are multiple and include:

* High costs, particularly of individual life assurance retirement products. Research undertaken by an independent actuary, Rob Rusconi, in 2004 showed that life assurance retirement annuities were the most costly of retirement products – judged not only on South African benchmarks, but also internationally. The costs are often opaque and difficult to assess.

* Confiscatory penalties, levied by life assurance companies when you cannot afford to maintain contributions to an RA fund. In 2005, the Finance Minister at the time, Trevor Manuel, imposed, in effect, a R3-billion fine on the assurance industry and placed limits on the penalties. However, penalties still apply and amount to losses for members. Penalties do not apply to non-life assurance RAs.

* Double-charging for asset management. Performance fees on top of annual asset management fees are becoming increasingly common. An annual asset management fee is already a performance fee, because the fee is a percentage of assets, and the better the returns, the more money the manager earns.

Mis-sold (but not necessarily bad) products

Cameron says there are a number of financial products that are sound but they are sold to the wrong people. The worst example has been the mis-selling of investment linked living annuities (illas), particularly immediately after their introduction in the 1990s. Most product providers and financial advisers failed to consider the risks of illa pensioners drawing down too large a percentage of their capital while attempting (mainly unsuccessfully) to counteract this with high-risk investment strategies. While the situation has improved in recent years, many pensioners have been condemned to eventual destitution at the very time when they are hardly likely to find alternative income.

And a few more …

Cameron says desperate pensioners, who have not saved enough for retirement, have been caught up in various scams and high-risk schemes trying to get a better return. These have included:

* Masterbond, the original biggie in 1984, in which 22 000 investors, many of whom were pensioners, lost a significant part of the R600 million they invested. At least 16 pensioners who were left destitute committed suicide.

* The Leaderguard forex scam, run from Mauritius, in which investors recovered only about R27 million of the R300 million lost.

* Property syndications. Cameron says this is probably one of the biggest tragedies, but because the losses come from various companies, the full extent will probably never be known. The authorities, which failed to take action to stop the disaster, seem loath to launch a comprehensive investigation. There has already been one known suicide of a pensioner who was left destitute.