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Former chief justice Ngcobo to untangle SARS spy scandal

Thursday, 30 April 2015   (0 Comments)
Posted by: Author: Natasha Marrian
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Author: Natasha Marrian (BDlive)

Former chief justice Sandile Ngcobo is set to be the next arbiter in the furore around the establishment of a covert unit in the South African Revenue Service (SARS).

For months, the tax agency was embroiled in a scandal following reports that it had established and ran a secret unit which spied on President Jacob Zuma and which had even operated a brothel.

A report by an independent panel headed by Adv Muzi Sikhakhane found the unit was indeed unlawful and recommended further investigation — by the inspector-general of intelligence Faith Radebe or by a judicial commission of inquiry.

Ms Radebe has investigated the matter but her findings have not been made public — and are unlikely to be.

An advisory board appointed by Finance Minister Nhlanhla Nene was also expected to "review" the matters surrounding the covert unit. But what emerged on Tuesday is that the board had simply rubber stamped the findings of the Sikhakhane panel. This is despite the findings being heavily contested by those who are now taking the fall for the unit.

By all accounts, the issue has come full circle, back to where it began in December when SARS commissioner Tom Moyane made a preliminary announcement on the findings of the Sikhakhane panel. The advisory board’s mandate was broad — to "guide the direction of long-term strategy" at SARS. But its immediate task was to "review" the issues reported in the media regarding the existence of an illegal, covert unit at the tax agency.

On Tuesday the advisory board announced it had indeed found that a "secret unit" was illegally established by SARS and "the application of financial and human resources" to the unit had no legal basis and "thus constituted wasteful and fruitless expenditure".

It urged SARS to wrap up the disciplinary processes against officials Ivan Pillay and Peter Richer as a matter of urgency and refer the matter to the police. Advisory board chairman Judge Frank Kroon said their findings were not binding on the disciplinary processes due to unfold. He effectively threw all the unanswered questions around the unit forward to Justice Ngcobo, who is chairing the disciplinary hearing of both Mr Pillay and Mr Richer. This was the forum, he said, where those implicated could contest both his findings and that of the Sikhakhane panel.

Judge Kroon admitted he had not interviewed those who set up the unit. The board clearly sought to dispose of the matter quickly. It was never mandated to delve deeper into the scandal. Nor was it mandated to embark on a fact finding mission.

But the board’s or SARS’s desire to see the matter laid to rest does not erase the many questions that continue to persist — about whether there were political motives for the widespread shake-up at SARS as alleged by former spokesman Adrian Lackay in his submission to Parliament. Mr Pillay himself in a submission to the Sikhakhane panel said organised crime as well as intergovernmental rivalry had also played a role.

While there are attempts to quash this narrative, it is likely to re-emerge during the disciplinary processes — unless a political intervention results in a settlement with officials beforehand.

The fact is the allegations on both sides of the debacle at SARS cannot simply be wished away by the board and revenue service.

This article first appeared on



Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.

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