Former CIEX chair criticises Mboweni over Absa bailout report comments

Last week, Mboweni’s shared his views in a Facebook post following advocate Busisiwe Mkhwebane's findings that Absa should repay over R1 billion received as a bailout.

FILE: Former South African Reserve Bank Governor Tito Mboweni. Picture: Facebook

JOHANNESBURG - Former CIEX chairperson Michael Oatley says that he finds former South African Reserve Bank (Sarb) Governor Tito Mboweni's comments on the Public Protector's Bankorp probe unattractive and dismissive.

Last week, Mboweni shared his views in a Facebook post following advocate Busisiwe Mkhwebane's findings that Absa should repay over R1 billion received as a bailout by its predecessor from the apartheid government.

Mboweni said that a special team of experts, which was previously hired to probe the matter, hadn’t found it necessary to pursue it further.

But Oatley is disputing Mboweni's version, saying that the findings of the team appointed by the Reserve Bank had in fact confirmed CIEX’s version that the Bankorp loan was illegal.

The company had probed the matter between 1997 and 1999 on behalf of government.

Oatley says that he’s merely trying to set the record straight.

“As a point or fact, they didn’t reject my offer, they employed me. I find his remarks unattractive and dismissive, and I’m merely trying to set the record straight.”

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Parliament has joined Absa and the Sarb in their legal action against the Public Protector.

Mkhwebane wants members of Parliament to change a section of the Constitution that speaks to Sarb’s protection of the value of the currency. It's a call which has been met with fierce criticism.

In her report released earlier this week, the Public Protector found the Reserve Bank failed to protect the public interest by bailing out Bankorp during the apartheid era and then did not recover the funds after Absa took over.

Mkhwebane went as far as spelling out the changes that should be made to the Constitution.

But, Section 57 of the Constitution empowers the National Assembly to control its own arrangements, proceedings and procedures.

Parliament says that although the Public Protector's remedial action is binding, Mkhwebane's report effectively usurps the powers of the institution.

Judge Dennis Davis, who chaired the Davis Committee of Experts that investigated the Bankorp bailout in 2000, says Mkwhebane's Absa report could have huge implications as it says that all monies misspent by government must be recovered.

Judge Davis says Mkhwebane points to an international treaty signed by South Africa that says that government has an obligation to recoup money that has been shown to be wasteful expenditure.

“If that is the argument the Public Protector is presenting in the report, I suspect it is going to be a very interesting argument that will come before court on a broader argument on government expenditure.”

Davis also says that while he has examined her report very closely, he does not find any fact or reasoning to change his finding that Absa should not pay any money to government.

(Edited by Shimoney Regter)