SARB accused of cover-up in Phala Phala; EFF calls for parliamentary inquiry

Reserve Bank Governor Lesetja Kganyago. Picture: Simphiwe Mbokazi

Reserve Bank Governor Lesetja Kganyago. Picture: Simphiwe Mbokazi

Published Aug 30, 2023


The South African Reserve Bank has come under fire in parliament over its Phala Phala report and has been accused by political parties of a cover-up.

The Economic Freedom Fighters (EFF), United Democratic Movement (UDM), and Democratic Alliance (DA) said the SARB has not come clean on its investigation and is hiding behind laws to protect President Cyril Ramaphosa.

EFF deputy leader Floyd Shivambu called for parliament to conduct its own investigation because the public protector, the South African Revenue Service (Sars), and the SARB have failed to do their jobs.

But the ANC came out in defence of the SARB report, saying its scope was limited to looking at the contravention of foreign exchange regulations.

SA Reserve Bank Governor Lesetja Kganyago was appearing before the standing committee on finance on Wednesday to answer on the report into Phala Phala.

EFF deputy leader Floyd Shivambu said there was a cover-up in the investigation by State institutions.

He said the onus was on Parliament to do its own investigation.

EFF MP Mzwanele Manyi also said he supported Shivambu's claim that this was a shoddy investigation by the SARB.

"I must express my disappointment in the manner the SARB has dealt with this matter. It means the SARB has taken the narrowest route. Given the milieu of regulations the SARB operates under, just to pick one is very concerning," said Manyi.

He said there was Section 15(1) of the Financial Sector Regulation, which compels the SARB to do this type of investigation.

Dion George of the DA said the SARB is at the heart of the country’s financial system and cannot be seen to be compromised.

He said there were more questions than what the SARB has said publicly.

UDM MP Nqaba Kwankwa said the SARB report was a whitewash, and that was why they applied for the Protection of Access to Information Act to get the report.

ANC MP David Skosana said they welcome the report. The presentation is clear on the scope of the investigation, which dealt with alleged contraventions of foreign exchange regulations.

Businessman Hazim Mustafa had paid $580,000 for the buffalo, but it was never delivered.

Kganyago told the committee their investigation was focused on whether there was a violation of foreign exchange control regulations.

"Currency including foreign currency, physically introduced to the Republic is dealt with by customs and Sars," said Kganyago.

He also said Ramaphosa or Minister of Finance Enoch Godongwana have not been given the report because the law does not allow it.

The SARB is constrained by Section 33 of the SARB Act, which prevents disclosure of information on the affairs of the bank, he said.

"If you are asking me to avail the report, you are asking to commit an offence," said Kganyago.

"We have not shared it with the Minister of Finance, the President, or the President’s lawyers because Section 33 applies to them too," said Kganyago.

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