Pauli van Wyk <pauli@dailymaverick.co.

za>

Scorpio query: Makwakwa

Pauli van Wyk <pauli@dailymaverick.co.za> Tue, Jan 30, 2018 at 2:03 PM
To: SARSMedia <sarsmedia@sars.gov.za>, Sandile Memela <smemela2@sars.gov.za>

Good day Sars team,

I trust this finds you well.

I have done further research on the FIC accusations against mr Jonas Makwakwa. Kindly return the answers to
my questions to mr Tom Moyane by 14:00 tomorrow, 31 January.

I have seen a letter written by Makwakwa’s lawyer Liezel David, dated 10 August 2016 (reference 0377/2015),
with the subject line “Referral of Financial Intelligence for investigation”.

The letter is addressed to Commissioner Tom Moyane. The purpose of the letter is to get to know more about the
circumstances around the FIC investigation and report.

The letter requests Moyane to solicit some detail from the FIC, including information about the FIC investigators,
whether a warrant was properly issued and about suspicious reports relating to other Sars officials.

David uses section 40(1)(c ) of the FIC Act to bolster her request.

From Moyane's subsequent responses to David and the FIC Director, I’m unsure if he actually understand what
this section means and says. David did not quote section 40 of the FIC Act in her letter, but merely referred to it.

I therefore include it verbatim. Section 40(1)(c) states:

(1) No person is entitled to information held by the Centre, except –

(c) an accountable institution or reporting institution or any other person who may, at the initiative of the Centre or
on written request, be provided with information with transactions reported by such accountable institution,
reporting institution or person, unless the Centre reasonably believes that disclosure to such accountable
institution reporting institution or person of the information requested could –

(i) inhibit the achievement of the Centre’s objectives or the performance of its functions, or the achievement of the
objectives or the performance of the functions of another organ of state; or

(ii) prejudice the rights of any person.

From a reading of the Act it is clear that only the institutions with the power to investigate the relevant suspicious
reports – in this instance the report on Makwakwa and Elskie – may be informed of the FIC’s report. This
excludes the minister of finance as well as the alleged criminals.

It is clear that the director of the FIC is of the same opinion. In a letter dated 19 September 2016 (Ref 0377/2015)
by the director sent to Moyane, he details his concern about the "approach" followed by Sars.

Mr Murray Michell points out that it is a contravention of section 40 of the FIC act to disclose the FIC report or
parts thereof to Makwakwa and Elskie.

Michell is further disturbed by the fact that Moyane is using Sars effectively as a post box for questions by
Makwakwa's lawyers under the guise of some sort of "cooperation and guidance".

Says Michell: "The Financial Intelligence Centre has been providing Sars with financial intelligence since 2003.
Sars' employees are well aware of the access, handling and terms and conditions of the use of such sensitive
information. I must point out that the conduct mentioned above constitutes a serious criminal offence under
section 60 of the FIC Act."

For your convenience, I again quote section 60 of the FIC Act in full:

60 Misuse of information:

(1) Any person who-

(a) discloses confidential information held by or obtained from the Centre otherwise than in accordance with
section 40;
(b) wilfully destroys or in any other way tampers with information kept by the Centre for the purposes of this Act;
or

(c) uses information obtained from the Centre otherwise than in accordance with-
(i) any arrangements or safeguards made or imposed by the Director in terms of section 40 (3); or

(ii) section 40 (6),

is guilty of an offence.

(2) Any person who knows, suspects or ought reasonably to have known or suspected-

(a) that information has been disclosed to the Centre; or

(b) that an investigation is being, or may be, conducted as a result of information that has been or is to
be disclosed to the Centre,

and who directly or indirectly alerts, or brings information to the attention of, another person which will or is likely
to prejudice such an investigation, is guilty of an offence.

My questions to mr Tom Moyane:

1. As quoted by yourself in many letters and documents I had the privilege to read, you are very quick to solicit
legal opinions on matters you might be unsure of. On your own version, it is clear that you contravened section
40 of the FIC Act. Murray also points out that Sars officials who have been working with the FIC know the rules.
Why did you not solicit a legal opinion or consulted one of the knowledgeable Sars employees before you
disclosed the FIC report to Makwakwa and Elskie?
2. From my analysis of Makwakwa’s bank statements, it is clear that your disclosure alerted Makwakwa to the
fact that he is being watched. The mysterious payments immediately stopped. What is your comment?

3. It seems as if, again, you did not solicit a legal opinion or consulted with knowledgeable Sars employees
before you forwarded Makwakwa’s lawyer’s questions to the FIC. It is clear that neither Makwakwa, nor his
lawyer may be aware of the FIC’s report, and may not be assisted in soliciting information from the FIC. The
information requested by Makwakwa’s lawyer were based on technicalities of the sort lawyers would use to
attack the basis of the FIC investigation and report. You assisted an alleged money launderer and fraudster in his
mission to find a basis to attack the FIC on. You were in contravention of the FIC Act and effectively acted as a
post box for Makwakwa in order to help him. What is your comment?

4. Between May 2016 and September 2016 Makwakwa was under suspicion, and you were trying to solicit
information from the FIC about the investigation in order to assist Makwakwa. Yet you allowed Makwakwa to
attend planning meetings with minister Pravin Gordhan, meetings with tax committee chair judge Dennis Davis as
well as meetings with parliamentary committees. Would you describe this as an act of good governance, and
acting in the best interests of Sars?

5. The letter from Michell caused you to attack him and the FIC in public. You told the public that the FIC was
“unhelpful” and refused to cooperate and guide the Sars investigation. The truth was that the FIC refused to
answer questions by the subject of the investigation (Makwakwa), posed through your office. It seems you were
misleading the public on the full extent of your communication with the FIC and the goals thereof. What is your
comment?

6. On World Customs Day on 26 January this year, you were walking on a red carpet when arriving at the
event. I am told that the red carpet is also rolled out for you whenever you visit Sars branches and offices across
the country, or during select ceremonies at the Sars offices in Pretoria. This has never been done for any minister
or any previous Sars commissioner. I am further told from various sources that you insisted on the red carpet. It
has been described by several senior sources across eight departments in Sars as a clear sign of your
“egomania”, and that you are the “laughing stock of Sars”. What is the use of the red carpet, and what is your
comment on this view by your peers and employees?