Gungubele: 'PIC processes were brazenly breached in Ayo Technology deal'

Deputy Finance Minister Mondli Gungubele is testifying at the commission of PIC inquiry which is looking into allegations including impropriety.

FILE: Deputy Finance Minister Mondli Gungubele. Picture: @TreasuryRSA/Twitter

JOHANNESBURG - Deputy Finance Minister Mondli Gungubele says processes by the Public Investment Corporation (PIC) were brazenly breached in the controversial Ayo Technology Solutions deal.

Gungubele is testifying at the commission of PIC inquiry which is looking into allegations including impropriety.

One of the deals that were red flagged was the PIC’s decision to invest R4.3 billion in Ayo Technology which was considered a high valuation placed on the stock at its listing.

Gungubele says the Ayo transaction completely and blatantly flouted PIC governance and approval processes.

He believes Ayo will serve as an example to employees of the repercussions that come with breaching process.

Former CEO Dan Matjila signed off on the controversial deal and Gungubele has explained to the commission that there was a clear split in the board especially when it came to Matjila’s conduct.

He can't say why some people were pro-Matjila.

At the same time, Gungubele says allegations that he’s implicated in impropriety are completely unfounded.

Gungubele said when he was appointed as chairperson of the PIC board in May last year, he wanted to review how the board had dealt with allegations that Matjila had an improper relationship with Pretty Louw.

Matjila had been introduced to Louw by the then Intelligence Minister David Mahlobo and he helped her secure a loan for her business.

Gungubele said he was perplexed at how the board dealt with the matter, especially since it had been advised to conduct a forensic investigation, but before the findings had been released the board publicly expressed confidence in Matjila.

“In a nutshell, my concerns did not find resonance with the board.”

He said there were clear factions within the board and if a matter concerning Matjila was brought up, he already knew which board members would defend him.

Gungubele hasn’t given the names of these board members but says it will be evident in the minutes of their meetings.


The head of the PIC's internal audit department said a final report into the controversial Ayo transaction shows that several processes were breached when signing off on the deal.

Lufuno Nemagovhani returned to the commission of inquiry on Monday afternoon he had given evidence last month about the investigation into the R4.3 billion investment.

It's just one of the deals that is being scrutinised at the inquiry.

Nemagovhani said he's now concluded his investigation into the Ayo transaction and maintains there was no due diligence: “From the beginning, there were lots of PIC processes and all the key people who were involved throughout the processes, we recommended that action be taken against them.”

Nemagovhani said the deal was signed off before the requisite committee met to approve it.

Acting CEO Matshepo More and formerMatjila were part of the group that breached the pic's payment process.

He says they haven't yet considered the recent testimony of Victor Seanie who came forward last month saying he was unfairly suspended over the Ayo deal because he raised concerns before the deal went through.

(Edited by Mihlali Ntsabo)