More digging into 'dodgy' investment

GEORGE NEWS - Municipal Manager Trevor Botha, and any other administrative official who might have been involved in the decision to invest an amount of R350-million at Old Mutual Wealth back in 2017, will undergo a forensic investigation.

In addition, a process will follow to investigate allegations against the involvement of the Portfolio Councillor of Finances, Stag Cronje, in the matter.

This recommendation - an amendment to the original recommendation - was accepted by George Council during a special council meeting on Monday.

Council also took note of the outcome of Chief Financial Officer Keith Jordaan's disciplinary hearing, in which he was found guilty on three of four charges. Jordaan's dismissal was recommended by the presiding officer.

The choice of the financial institution Old Mutual Wealth, where the investments were made, came under scrutiny for "not being on the list" of institutions where municipalities may invest money.

Jordaan evacuated his office last Monday, 8 July. He confirmed that he will indeed take the matter to the CCMA (Commission for Conciliation, Mediation and Arbitration) to lodge a dispute against the finding and sanctions of his disciplinary hearing.

The disciplinary hearing was recommended by the firm FTI Consulting, who conducted a forensic investigation. According to information, the cost of this investigation amounts to over R800 000.

More investigations

The original recommendation on the item reported to Council on Monday stated that the findings and sanctions imposed by the presiding officer against Jordaan must be noted. The recommendation was, however, amended to include the investigation of more individuals who might have been involved in the Old Mutual Wealth investment.

Some of the documents were signed off by the Municipal Manager, Trevor Botha, which could implicate him in the matter.

Portfolio Councillor of Finances, Stag Cronje, also faced the heat since his son, a former agent for Old Mutual Broker Distribution, referred the municipality as a possible client to the financial services provider. In their sworn affidavits, both Cronje and his son vehemently object to allegations made against them, as stipulated in the report by FTI Consulting. A referral fee payable to the broker was the bone of contention.

When asked for comment, Cronje said he welcomes the investigation. "I have, on numerous occasions, asked for an investigation in order to be able to defend myself," said Cronje.

"I have declared my interest in this matter. However, I can't say the same of other councillors, who failed to declare their interests in other matters. This has been picked up by the Auditor General (AG), but it has not been amended in the Annual Report for 2017/2018, as recommended by the AG."

Speaker Gerrit Pretorius said he can't comment on the content of the amended recommendation, since the agenda item was confidential.

Quorum thanks to FF Plus

Opposition parties have asked on various occasions for steps to be taken against Cronje. Their latest request in Council on Monday to Speaker Gerrit Pretorius was that Cronje should leave the meeting, claiming his alleged involvement. Since their request wasn't met, most of the opposition parties left the council chambers. Gert van Niekerk of the Freedom Front Plus stayed behind and so helped the DA to obtain a quorum.

Chief Financial Officer, Keith Jordaan