In another post, we’ve responded to recent claims that public accountability has eroded in the post-apartheid period. Whatever the current problems facing South Africa, we argue that there are no ‘better days’ to hark back to. Here are eight corruption scandals under the apartheid system that remain ‘open secrets’, for which no meaningful action has been taken.

  1. Oil Sales and Swiss Bank Accounts: In 1984, the Progressive Federal Party leader Fredrick van Zyl Slabbert received documents concerning oil sales to South Africa, allegedly reflecting corruption in the oil trade. These were handed to President Botha and the Advocate-General – but nothing came of the investigation. It may have been too hot to handle. See Embargo: Apartheid’s Oil Secrets Revealed [PDF download].
  2. Smit Murders and Secret Accounts: After the 1978 murder of Robert and Jeanne-Cora Smit (he was a former SA IMF representative and NP parliamentary candidate), rumours persisted for decades that he was murdered for stumbling on secret overseas bank accounts which linked to members of the apartheid elite. At the same time allegations persisted, based on investigations by the Rand Daily Mail, that former Minister of Finance Nico Diedrichs may have had links to a secret bank account in Europe.
  3. SADF Secret Funds: About R378 billion (current value) was spent to fund secret defence projects and procure weapons. This happened with very limited oversight from the Auditor-General. Given what we know about the global arms trade it would be fair to assume that this was open to possible systemic abuse by individuals, corporations and financial institutions, but there has never been an opportunity for public scrutiny. This was mentioned in the TRC’s final report.
  4. The Apartheid Bantustans: allowed extraordinary tax breaks for white companies, some of which sidestepped exchange control laws. Concerns of an improper relationship between South African business and the homelands are typified by allegations that Sol Kerzner paid R20million (in current rand value) in bribes and facilitation fees for gaming licences to Transkei Chief George Matanzima. Kerzner argued it was extortion, and all charges were controversially dropped by Transkei attorney general Christo Nel in 1997.
  5. International criminal networks: Vito Palazzolo, charged with links to organised crime in Italy following his recent extradition from Thailand, was made a special representative for the Ciskei. Noseweek has alleged that he was used by intelligence agencies to clean “hot” money to finance arms and nuclear cooperation. Though a NP parliamentarian was convicted in 1990 for having improperly secured residence permits for Palazzolo, in 1993 FW de Klerk’s Cabinet reportedly approved a new residence permit for him, despite the fact that he was wanted by Italian police at the time.
  6. SADF and Ivory: Nearly 100,000 elephants were allegedly slaughtered during the civil war in Angola and Mozambique. This appeared to benefit the leadership of UNITA and possibly a small group of senior SADF officials. The post-1994 Kumbleben Commission of Inquiry found substantial proof of SADF involvement through a front company, but no action was taken.
  7. Apartheid Death Squads: The CCB was allocated about R116 million each year (current value) and members were handed huge wads of cash on trust. The expenditure of approximately R45 million (current value) was found to be improperly authorised with little consequence. (See In The Heart of the Whore: The Story of Apartheid’s Death Squads by Jacques Pauw.)
  8. Exchange Control Amnesty: The 2003 Treasury Exchange Control Amnesty process attempted to address capital flight from the 1980s onward. Nearly 43,000 applications were processed and a total of R68,6 billion was disclosed. Individuals and corporations made a once-off payment for being in violation of exchange control and income tax. However, there is no indication of prosecutions or legal action taken against those who were not transparent about their offshore holdings. Economists have suggested this represented a massive under-reporting of the actual value of illicit capital flight during that period.

See also:  Response to Tony Leon: When politicians dabble in half-truths

Do you have information you wish to share with the OpenSecrets team about these cases or any other issue that we are working on? Please contact us here.

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