STATE CAPTURE TRIAL

Officials gave top-speed service to Gupta man

The Free State rural development department made a R12.4m payment to a company it had no contract or existing relationship with, with its banking details scribbled on a piece of paper.

The ease with which the Gupta family allegedly ripped off the department was among the explosive details to emerge during the first week of the Nulane fraud and corruption case, the first state capture case to go on trial.

The case under way in the Free State High Court in Bloemfontein concerns the allegedly corrupt feasibility study that paved the way for the infamous R280m Estina Dairy Farm project in Vrede, which allowed former president Jacob Zuma’s friends to allegedly steal millions from the state.

Shadrack Cezula, a department official turned state witness, drafted the deviation document on October 6 2011. It was used to pay Gupta associate Iqbal Sharma’s Nulane Investments the R12.4m advance payment on the very day it was drafted.

The highly-anticipated case features Sharma, his brother-in-law Dinesh Patel, Gupta lieutenant Ronica Ragavan, three provincial officials and two companies. The extradition from Dubai of Atul and Rajesh Gupta has been sought in connection with the matter. Department money amounting to almost R20m ultimately found its way into the family’s company bank accounts.

Sharma attended court each day in immaculately tailored suits, his lightened hair styled to perfection, in contrast to when he was first arrested and appeared in court looking dishevelled. He did not utter a word to his brother-in-law Patel, who allegedly helped to perpetrate the fraud, despite sitting one seat away from him.

Sharma’s wife, the actress and socialite Tarina Patel, was conspicuous by her absence. However, the two remain firmly on the Johannesburg social scene. They attended the launch last weekend of the Kings of Jo’Burg Netflix series in Rosebank in colour co-ordinated outfits.

Cezula, the department’s former acting senior supply chain manager, told the court he had been “instructed, pressured and dictated to” by his then boss, the department’s chief financial offer and now accused number three Seipati Dhlamini, to write the contents of the document.

“She was dictating what needed to appear on the document. I had to type as she was dictating,” he said.

Cezula was the state’s second witness after forensic investigator Siphiwe Mahlangu spent two days on the stand. He testified that Dhlamini dictated the document to him in his office while accused number one, former department head Peter Thabethe, repeatedly called her to find out if they had finished with it.

Cezula said he now recognises that it was wrong to bow to pressure and draft the “urgent deviation” to pay Nulane Investments millions on the same day without the necessary documents being provided.

He testified that a letter from a scrap metal dealer in New Delhi, India, called Worlds Window Impex India, was used to support the deviation. The company had apparently proposed to enter into a public-private partnership with the Free State government.

Cezula said the document he drafted and sent to both Dhlamini and Thabethe came back containing changes that indicated the Indian company preferred that Nulane Investments be appointed to conduct the feasibility study on the project.

Cezula said Dhlamini had told him there was an “urgent” need for a deviation document and that payment had to be made that same day. He also testified that Thabethe not only called Dhlamini repeatedly, but phoned him on his landline to inquire how near he was to completing the memo.

The document ensured that Nulane Investments did not have to compete for the contract, which was not put out to open tender.

Cezula told the court he had to accompany Dhlamini to the finance department to ensure the money was paid to Nulane, whose banking details Dhlamini provided scrawled on a piece of paper.

Though the deviation memo was signed by neither Thabethe nor provincial agriculture department head Limakatso Moorosi, the payment to Nulane was processed. “We knock off at 4pm, but the payment went through after 5pm,” Cezula said.

However, defence lawyers accused Cezula of refusing to own up to the document he both wrote and signed.

During cross-examination, Thabethe’s lawyer Daniel Mantsha, who was also Zuma’s lawyer for a time and the board chair of arms manufacturer Denel during the state capture period, disputed Cezula’s version that Thabethe had called him to check on his progress.

Mantsha said this was improbable, as

Thabethe was not at work on that day.

“That’s why it was strange for me that he [Thabethe] called me after he spoke to the CFO,” Cezula responded.

Dhlamini’s lawyer, Willem Edeling, accused Cezula of lying, saying that as CFO, Dhlamini wouldn’t go to her juniors’ offices.

“She doesn’t go to people’s offices. They come to her office,” Edeling said.

Moorosi’s lawyer, advocate Ishmael Semenya SC, told Cezula it was his recommendation to approve the deviation that convinced Moorosi to sign the document used to pay Nulane Investments.

Semenya said Cezula had not warned Moorosi of the pressure he was under when drafting the letter, which Celuza admitted.

On Monday, Sharma was the last accused to arrive in the dock, at around 10.10am, just before the proceedings began before acting judge Nompumelelo Gusha.

Nulane Investments subcontracted its work to Deloitte Consulting, which did it for R1.5m. Dinesh Patel handled the negotiations on Nulane’s behalf.

Mahlangu, from the National Treasury’s forensic audit unit, assessed Celuza’s document and testified that it did not meet the requirements for a deviation. He said his investigation found that the Nulane contract was never a public-private partnership. He highlighted the issue of payments being made to Nulane before a contract existed between the investment company and the department.

Judge Gusha cautioned Edeling for berating Mahlangu and accusing him of behaving “like a dog on leash” after he refused to agree with his allegation that the investigating officer had written Mahlangu’s affidavit for him.

There was some comic relief on Friday when Patel’s lawyer, Kenny Oldwage, while cross-examining the former director for supply chain management in the Free State agriculture and rural development department, Avelamadoda Stofile, turned on the prosecuting team led by advocate Peter Serunye.

“My learned friend shouldn’t distract me by giving me evil looks,” he charged.

Meanwhile, Thabethe and Dhlamini are also accused in the Estina case alongside former mineral resources minister Mosebenzi Zwane. This case returned to the same court on Wednesday and was postponed to April for a pretrial conference.

In this matter they are charged alongside the merged agriculture & rural development department’s former chief director of district services Takisi Masiteng, Estina director Kamal Vasram, Ragavan and former Sahara Computers employee Ugeshni Govender.

Asked how he felt, a smiling Zwane — who is still an MP and until recently the chair of parliament’s portfolio committee on transport — said after court was adjourned that he had assumed the “posture as a leader” and would not pre-empt the outcome of his case.