PIC report recommends that monies must be recovered with interest

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The much-awaited report that President Cyril Ramaphosa has released on the Public Investment Corporation (PIC) has recommended that steps must be taken to recover all monies due to the Corporation with interest.

Justice Lex Mpati headed the Judicial Commission of Inquiry into allegations of impropriety at the PIC which handed the report to President Ramaphosa in December last year. The report says the money should be recovered where personal or other sureties were a precondition to the approval of the investment.

The report has flagged Dr Dan Matjila as someone who stood to be vastly enriched by the transactions involving the PIC. It says such behaviour undercut the objectives of the fund and are in contravention of the PIC’s mandate.

In the audio below, economist at Efficient Group, Dawie Roodt, says pensioners now need a guarantee that their money is safe:

The report stipulates that in relation to a number of the transactions considered, there were contraventions of PIC Policy, processes were not followed, necessary disclosures were not made to the Board and on certain occasions, the Board was misled.

It further says in certain transactions, the Commission found that the Standard Operating Procedure was not followed. The Commission found that a number of individuals unduly benefited from the improprieties identified.

The report highlights that the role of Dr Matjila is concerning in terms of his one-on-one meetings with individuals who stood to be vastly enriched, undercut the objectives of the Isibaya Fund and are in contravention of the PIC’s mandate.

The Commission report has cautioned the PIC against the enrichment of only a few individuals, repeatedly. It says that this was caused by improper due diligence and was in violation of the core mandate of the PIC to make funds available to a broad swath of South Africa’s people in the interests of development.

In respect of the controversial transaction entered into by the PIC with MMI, Matome Maponya Incorporated – the Commission found that the PIC had been overly exposed to one client.

The report says that the Commission finds that the PIC’s decision to make cumulative investments in various transactions with a single individual has resulted in significant exposure to reputational risk and financial losses by the fund.

The Commission recommends that the Board should develop clear policies to guide the involvement of PIC employees and non-executive directors in investee companies.


Below is the statement released by the Presidency on the PIC: